Aroway Energy Inc. (TSX: V.ARW, Stock Forum) is a Western Canadian junior oil focused production and exploration company participating in oil development & exploration prospects in Alberta and Saskatchewan, Canada.
Aroway started out as a non-operated oil and gas exploration and production company. Late in 2012 Aroway announced certain acquisition that now sees Aroway operating as well. Can you discuss this and the reasoning behind Aroway taking on Operatorship as well and how it affects the original direction and relationship with Aroway’s current Joint Venture Partner?
When we started Aroway, we were very fortunate to have a full operating partner in place that has a very good reputation in the oil patch and we were also blessed to have some early success. However, when a Company begins to grow and starts to build good cash flow from operations, you always want to control your own destiny. Because our partner is a private Company, they have the luxury to operate in a different style and pace than a public Company. Private Companies can take their time as they do not have to report to the public markets and retail shareholders and are not held under the same public microscope as a listed Company. Public Companies are expected to continue to grow and create excitement for its shareholders through its operations while under the public microscope. Aroway was 100% dependent on our partner, which worked out well when we started Aroway, and continues to work well, but as a management team we thought it would be best for Aroway’s growth to seek some of its own properties and capitalize on the opportunities that we have been presented based on our contacts and experience in the oil patch. We have since made two great acquisitions that have proven to be very rewarding for Aroway in both opportunity and success. The acquisitions have allowed us to remain active exploiting our new properties and adding production and cash flow, while at the same time we work alongside our partner to build an exciting program for 2013.
What has been the delay in getting the current year end production out to the market?
Usually most delays reflect some sort of bad news; however this is not the case in our situation. We have been feverishly trying to get our last drilled well from 2012 on production having made the necessary filing to the ERCB (Energy Resources Conservation Board). Without being able to divulge too much information, I can tell you that we have gone back and forth with the ERCB with respect to how the well should be produced. Like any regulatory body, the ERCB did not respond immediately but they have been very good in getting back to us in a timely manner. I am therefore confident that we will have the well on production in short order and be in a position to announce our 2012 corporate production.
Why should a new investor be interested in Aroway Energy Inc. today?
Both current and new investors should be interested in Aroway today as we are looking to 2013 to continue to grow at an even faster pace. We will continue to drill on our existing properties and leverage our strong balance sheet and cash flow by being more aggressive in the opportunistic acquisition market which we feel is beginning to peak. We are growing Aroway with a very strategic process in mind and we have a diversified asset base with lots of exploration upside in our large land base in the Peace River arch complimented with stable production in our West Hazel property in Saskatchewan. Furthermore, our other recently purchased Alberta properties have a very real potential to become a new core area for the Company. Current and new shareholders should take comfort in knowing that we are looking to almost double our production exiting 2012, and would like to continue that aggressive growth pattern through 2013.
Why should Aroway’s current investors stay invested in Aroway?
We have proven over the past two years that we meet our goals and will continue to meet our goals going forward. The milestones that we set to achieve are well thought out each year taking into account what we think is possible from our properties and what we think is happening and going to happen in the marketplace. We strive to meet our targets every year and thus far have been successful in meeting those targets; going forward we will continue to demand more and more from our team so our shareholders benefit in the end.
What do you see as some of the major catalyst for Aroway in 2013?
Our 2013 mandate is to continue to grow Company production, cash flow and opportunity. By opportunity, I mean continue to add to our existing high quality assets, which provide lots of running room through our conventional drilling model. We also believe there will be more production acquisition opportunities in the market with similar internal rates of return and upside like our West Hazel acquisition. We will also be looking to move up to a full TSX listing in early 2013.
What are some of the goals for 2013?
As I mentioned previously we are working to build on our existing production and cash flow. We are not ready to give any guidance yet at this point but we will be looking to repeat the type of production increases we have shown over the past two years. Beyond that we will be looking to graduate to a full TSX listing.
Disclosure: Aroway Energy is a Stockhouse client.