Producing property with upside potential
Arrow Exploration Corp, the high-growth operator with a portfolio of assets across key Colombian hydrocarbon basins, has announced a property acquisition in Alberta, Canada.
Highlights
- Acquisition of 100% working interest in 550 boepd oil producing property in Thorsby, Central Alberta Canada
- Highly cash generative asset having generated $2.0 million CAD of operating income1 in last 12 months
- $12.15 million CAD (approximately $8.9 million USD) purchase price funded directly from on-hand cash reserves
- Significant 1P reserve base of 4.973 million boe, 2P of 7.537 million boe and prospective opportunities across 9,501 net acres of land
- Management plans to deploy development program across lower Cretaceous Sparky reservoir, having identified 22 low-cost, quick payout drilling locations on the property
- Current production is approximately 27% oil and liquids. 1P and 2P volumes approximately 55% oil and liquids.
Thorsby Property Acquisition
Arrow is pleased to announce it has acquired an oil producing property in the Thorsby area of Central Alberta Canada. The acquisition is a 100% working interest purchased from a private company. The Thorsby asset has current production of 550 boepd, with low decline rates of 15%, and a third-party reserve report estimating 4.973 million boe of total proved reserves (1P) and 7.537 million boe of total proved plus probable reserves (2P).
The acquisition price is $12.15 million CAD (approximately $8.9 million USD) and is being funded from Arrow's cash reserves. In the last 12 months the property has generated approximately $2.0 million CAD of operating income(1). The third-party reserve report, with an effective date of 31 December 2025, has pre-tax NPV 10 for the 1P and 2P reserves of $38 million CAD ($27 million USD) and $71 million CAD ($51 million USD) respectively. Arrow is assuming decommissioning liabilities of $8.7 million CAD ($6.3 million USD).
Thorsby is 9,501 net acres of 100% working interest land approximately 200km north of Calgary. All lands and associated infrastructure have been acquired as part of the transaction. Alberta Energy Regulator applies 55 million stock tank barrels original oil in place with a 3% recovery to date. Arrow believes there is significant original oil in place with secondary recovery potential to arrest declines and boost recovery factor.
The lower Cretaceous Sparky reservoir is up to 25m in places with a 15-meter net pay average at a 9% cutoff. Management has identified 22 upside drilling locations on the property.
(1) Revenue less royalties less operating costs and workovers
Marshall Abbott, CEO of Arrow commented:
'The Thorsby acquisition represents a low-risk, exceptional return inventory suite of development drilling opportunities. The development focus is on the Cretaceous Sparky Formation as a proven reservoir where management has years of geologic fluency. It gives the Company a significant increase in reserves, a low-risk development program with 22 initial drilling locations, while the Company remains debt free and financially healthy.'
'The 2-mile lateral horizontal wells that Arrow plans to drill at Thorsby are expected to cost approximately $2.2 million CAD . Each well pad is planned to contain 3 wells. The Thorsby area has year-round access and is close to abundant infrastructure.'
'The Sparky wells have high initial production (300 BOPD) rates with low declines and pay out very quickly. The Sparky reservoir has a history of reacting positively to secondary recovery, such as water flood.'
'Management believes that the Thorsby acquisition complements the Colombian operations very well. Geologically the play type and trapping mechanisms are very similar. That is 3-way structure juxtaposed against a sealing barrier. This also represents very similar reserve capture and adds significant cash flow and IRRs that exceed 500% on a well-by-well basis. Thorsby also represents additional drilling inventory that is complementary to Colombian inventory. This provides significant optionality in pursuing highest value add prospects.'
'The dedicated Arrow team remains committed to pursuing additional high return opportunities in both jurisdictions.'
Source: Arrow Energy
