Arrow Exploration Corp (TSX-V:AXL, AIM:AXL, OTC:CSTPF) has provided an update on the drilling activity at Rio Cravo Este (RCE) oil field on the Tapir Block in the Llanos Basin of Colombia, noting that the RCE-4 well was spud on March 1, 2023, and reached total depth on March 8, 2023.
In a statement, Marshall Abbott, CEO of Arrow commented: "RCE-4 was drilled quicker than any other well on the Rio Cravo structure to date. The team's growing experience with the play is resulting in more efficient operations and lower costs. The log results of RCE-4 are in line with our expectations for the well. This is the fifth well drilled by Arrow on the Tapir block and it has confirmed the continuity of oil-bearing intervals seen in adjacent wells.
"We're currently completing the C7 zone, targeting to be on stream in late March. This will increase Arrow's production and reserves. Arrow will bring RCE-4 on slowly and increase production to best manage the oil reservoir. Once RCE-5 is drilled, the rig will mobilize to drill the three planned wells on the Carrizales Norte Structure 20 km away.”
READ: Arrow Exploration says it is ‘encouraged' by initial production at RCE-3 well
He added: "The results of the RCE-3 and RCE-4 wells, together with our confidence in the outcome of the RCE-5 well and our upcoming program at Carrizales Norte, provide us with confidence that we will achieve the stated objective of achieving a production rate of 3,000 boe/d within 18 months of its AIM listing (completed in October 2021). The next few months will be an exciting and busy time for Arrow, and we look forward to providing further updates on our progress."
The company said the RCE-4 well was drilled to a total measured depth of 8,546 feet (8,053 feet true vertical depth) and encountered six hydrocarbon bearing intervals totaling 45 net feet of oil pay (measured depth).
Arrow said it is expected that the RCE-4 well will begin production in late March 2023. The rig will then be moved to the RCE-5 location with the intention that RCE-5 will spud within a few days of RCE-4 being brought on production.
The following hydrocarbon-bearing intervals were identified at RCE-4:
- Carbonera C7: 25 feet net oil pay over two intervals
- Lower Gacheta: 20 feet net oil pay over four intervals
Interval thicknesses are not necessarily indicative of long-term performance or ultimate recovery.
Arrow also said the RCE-3 well continues to flow naturally at 650 BOPD gross with no pressure drop and zero water cut. It anticipates activating the submersible pump to increase production on a measured conservative basis to achieve a balance between maximum production and ultimate recoverable reserves. The same incremental approach will be applied to RCE-4 and RCE-5.
Capella Field and board update
Arrow Exploration also noted that meetings have progressed between the Columbian government, protesters and operator regarding the Capella field in the Ombu block.
The government has agreed to some of the demands of the protesters and is reviewing other requests. Protesters have been leaving the area.
The Capella field continues to be shut in and is currently protected by the Colombia military.
Arrow said it hopes for a safe and quick resolution and return to operations.
The company also said that, following the resignation from the board of Maria Charash to pursue other opportunities, it plans to add a new independent board member once a suitable candidate has been identified.
Arrow Exploration - operating in Colombia via a branch of its 100% owned subsidiary Carrao Energy SA - has a business plan to expand oil production from some of Colombia's most active basins, including the Llanos, Middle Magdalena Valley (MMV) and Putumayo Basin.
The asset base is predominantly operated with high working interests, and the Brent-linked light oil pricing exposure combines with low royalties to yield attractive potential operating margins.
Arrow's 50% interest in the Tapir Block is contingent on the assignment by Ecopetrol SA of such interest to Arrow.
Contact the author at jon.hopkins@proactiveinvestors.com