Arrow Exploration Corp CSTPF

From Joe

[EagleHasLanded]

Arrow has a number of buyers (marketers) who make offers to buy both our C7 and Ubaque crude at Carrizales Norte and RCE.  The list of buyers that we have had contracts with in the past include Frontera, Trafiguar, BP, PMI, Invesegg, and others.  We are continually trying to find the best prices and buyer for our crude.
 
Currently our Ubaque crude is being sold at Brent, less the Vasconia differential (approximately $3.50/bbl currently), less a $9/bbl logistics fee.  The logistics fee is a quality differential (from Vasconia) and transportation charge rolled into one discounted price.  The marketer picks up our crude from our tanks in their oil trucks and is responsible for all trucking fees.
 
The current Ubaque contact is not with Frontera but with a different marketer.  The Ubaque crude is 13 degree API.  It is not being used as a diluent.  It is going directly into the pipeline, perhaps after being mixed with a lighter crude to increase its value.
 
One of the options we are looking into is preparing our own mixing plant on the CN or RCE pad.  The objective would be to mix our own C7 and Ubaque oil to try to maximize our revenue.  With greater production this option may be economic.
 
There does not seem to be a limit to the amount of crude that we are able to sell.  Colombia and the Llanos basin in particular, have a very developled crude marketing business.  Remember that some fields in the Llanos basin is in decline, and marketers are quite happy to use our crude to make up for other operators declines.
 
I hope that answers your question.
 
Thanks
Joe

[EagleHasLanded]

Your understanding is not entirely correct.  In Canada we have over $75 million in pools and losses.  The Canadian pools do not reduce Colombia taxes. Arrow is taxable this year in Colombia.  At the beginning of the year we did have losses and pools of approximately $10 million and we are spending over $30 million in Colombia which will also create tax shield.   The RCE and

[EagleHasLanded]

RCE-6 is drilling as scheduled.     The remainder of 2023 is development wells.  We are planning to have our first exploration well drilled in Q1 2024.   Hope that helps.   Thanks Joe

[EagleHasLanded]

  As you know the 3D has picked up quite a few prospects and they are all different.  For example, at Mateguafa Attic the main target will be C7, however it is very likely that there will be multi zone potential.  Baquino looks to be very similar to CN, we would expect the C7, Ubaque and perhaps the Gacheta to be in place.   The cost of drilling each prospect will also be

[EagleHasLanded]

The number of warrants currently outstanding are 2,831,073.   All warrants will expire at the end of November.   Thanks, Joe Note! Outstanding warrants may already been exercised and may be sold as shares

[EagleHasLanded]

The rig is being built up at Oso Pardo right now.  It is still expected that both wells should be drilled and on production by the end of the year.   Thanks Joe

[EagleHasLanded]

In Colombia there is a moratorium on fracking.  The Petro government is also pushing through new anti-fracking legislation that will make fracking in Colombia illegal.  This may change in the future with new governments; however, we are not pursuing any unconventional plays in Colombia at this time.   Currently, we do not have plans to test zones other than the Umir with the two

[EagleHasLanded]

There are 375,000 warrants remaining.  These were part of the Canadian financing that closed November 22, 2021.  It was done at the same price as the UK listing and enabled the Canadian shareholders to hold their position.  These warrants will expire on November 22, 2023 (in one month).   I believe the warrant overhang issue is firmly behind us now.   Each Oso

[EagleHasLanded]

some additional from Joe:   Horizontal wells would work at CN because you have a thick, continuous sand.   Oso Pardo is a different play where we have many thin sands that are individually perforated.  The sands also “move” or change depth at Oso Pardo which would make steering a HZ well more difficult.   I hope that is helpful.   Thanks Joe

[EagleHasLanded]

Q: Now that all the October warrants have been exercised we only have 375k November warrants left. As management, Tim Leslie and Canacol all seem to be holding their full allocations, what is your view on the relentless 50k to 100k daily sales? This has been going on for a number of weeks now and would seem to be the main reason the SP is struggling along in the high teens (UK Pence) in a high oil

[EagleHasLanded]

The Oso Pardo well spud on October 27th.   Thanks Joe

[EagleHasLanded]

RCE-6 is on schedule and we hope to have communication out to investors in the near future.   Thanks Joe

[EagleHasLanded]

  The rig is still at the RCE-6 site and we are in the completion process.  RCE-7 will spud once RCE-6 is on production and the rig has move to the RCE-7 site.   Thanks Joe

[EagleHasLanded]

We should have a press release out on RCE-6 this week.   Thanks Joe

[EagleHasLanded]

Sorry I did not get back to you sooner. Very busy week here with our Q3 release out next week. RCE recovery factor for 2P is 36% Oso Pardo recover factor for 2P is 26% I spoke to Gage and Marshall about your question regarding management investing in Arrow. We believe that management already has a considerable amount invested in Arrow in both cash and time. Our holdings are public knowledge, and

[EagleHasLanded]

The plan is to release company production numbers with upcoming well results.  We normally do not release with quarterly results.   Q3 was another good quarter with almost double the oil production, revenue and cash flow from operations compared to the same period from last year.   Thanks Joe

[EagleHasLanded]

Part of the answer is timing.  We need to prepare a new pad to get the best results from the horizontal wells.  The new pad requires regulatory approvals, environmental studies, etc.  We hope to have a new pad ready for mid-March 2024.   Our plan is to drill 3 initial horizontal wells and review results.  If we are comfortable that the horizontal wells are the best

[EagleHasLanded]

I spoke with our geologist on your question.   The infill vertical wells at CN we have a very high chance of economic success.  90% and above. The step out vertical wells at CM we also have a high chance of economic success 80% - 90%.   Horizontal wells have never been drilled into this reservoir before.  Despite this, the reservoir thickness and characteristics seem perfect

[EagleHasLanded]

Question for Joe: Do you think this will affect Oso Pardo extension? Or is an extension not a new license?   https://forbes.co/2023/12/12/economia-y-finanzas/colombia-y-la-transicion-energetica-los-riesgos-de-ir-en-contra-de-la-tendencia-global Answer: Petro has not changed his message since he was elected in Sept 2021.  No new exploration blocks are being offered for bids by

[EagleHasLanded]

  Actually, we do not have names for the HZ wells yet.  In the budget I am calling them CNHZ-1, etc.  I will work on that.   Right now I have the first HZ well budgeted to spud near the beginning of April 2024.  We are constructing the pad and road to the HZ location right now.   Thanks for your continued interest and support this year.   Joe

[lutefish]

No more updates this year  ?????

[EagleHasLanded]

Joe said at the end of the year so hopefully next week 

[lutefish]

 News from 3 --.4 wells   imminent . ! ! !  Next week ? Should Be Good ! !

[lutefish]

Arrow in the UK is UP . Come on  Canada . Drill RESULTS  Imminent !!!

[lutefish]

 Re News Release xpected . End of the year has now become Beginning of the year ?

[lutefish]

 Why the procrastination   ?        News release is long overdue . 

[EagleHasLanded]

Regarding OP wells: We expect the stimulations to take place in Q1.   Thanks Joe

[EagleHasLanded]

Marshall, Gage and I have just returned from some meetings and presentations in Bogota last week.    Morsa 1, Oso Pardo 1 and Oso Pardo 2 came on production in between July 2013 and August 2014 and reached average IP rates of 360 bbls/d.  Together they have produced 561,650 bbls of oil since they began production.   Hope that helps. Joe

[EagleHasLanded]

I asked Joe to elaborate on their recent meetings in Colombia: We met with partners (Petrolco and Emerald), Peers (other oil and gas companies on A&D opportunities), Government regulators (ANH, Ecopetrol), Directors, Investors and Malcolm Graham-Wood.  We met with suppliers (HZ well experts, rig, tubulars, directional).  Legal and Tax.  Of course the Arrow Team in Colombia.

[EagleHasLanded]

Reserve report is being worked on.  I hope to have reserves updated by mid March.   Thanks Joe

[EagleHasLanded]

We met with the new ANH President when we were in Bogota last month.  This is the 3rd ANH President in the last two years.   He is very supportive and said he would help us with the process.  The ANH wants the process to move forward because the extension will create jobs for the community in the Oso Pardo area.   The hold up continues to be ConocoPhillips.  So far

[deet]

Extension approval on what? Can you please elaborate? I'm new here.

[EagleHasLanded]

The Oso Pardo extension 

[deet]

Can you tell us what that is??

[EagleHasLanded]

Read the presentation, Oso Pardo is a oil field in the Santa Isabella block in Magdalena valley. two wells currently producing, if the company gets an extension, up to 20 more wells will be drilled. Each well can produce 400 bod. Dyor

[EagleHasLanded]

Marshall’s comment is correct.  We do see declines due to water cut increases.  Once the wells get to a higher water cut they do seem to flatten out and stabilize.  We believe the horizontal wells will assist with this process and still have higher oil production even with high water cuts.   The HZ wells are still on track.  We hope to have the first one on production in

[EagleHasLanded]

Marshall and I are very familiar with polymer floods from a previous venture we were involved in.    At Tapir we are working with a natural water drive which we believe is doing a very good job of sweeping the oil.  We believe the horizontal wells are what is required for maximum economic recovery at Carrizales Norte.   Thanks for your interest.   Joe

[deet]

Getting clobbered again today even though oil continues to skyrocket. I don't get it.

[666999]

Look at the chart, then look at share nr., then compare Axl mkt cap to other producers with same boe/d , folks took profit, chart shows that pullback was on the table,