Arrow Exploration Corp (TSX-V:AXL, AIM:AXL, OTC:CSTPF) has announced the results of its 2022 year-end reserves evaluation by Boury Global Energy Consultants Ltd which saw proved (1P) reserves increase by 11% to 3.37 million barrels of oil equivalent (boe), driven principally through uplift at Tapir (Rio Cravo), Colombia.
In a statement, Marshall Abbott, CEO of Arrow, commented: "Arrow delivered an increase in volumes and pre-tax values across 1P, 2P and 3P reserves in 2022. We are pleased with the results of the BouryGEC reserves evaluation, which reinforces the significant value of our Colombian and Canadian assets.”
"The BouryGEC 2022 report of course does not account for the current drilling campaign at Rio Cravo Este, where, given the encouraging results to date, we might expect further reclassifications and increase in reserves. Additionally, with the imminent drilling of the Carrizales Norte wells, we would expect to continue growing reserves in the near future,” he added.
READ: Arrow Exploration updates on drilling activity at Rio Cravo Este on the Tapir Block in the Llanos Basin of Colombia
Other 2022 year-end reserves evaluation highlights:
- Net present value before tax, discounted at 10% (NPV-10), is $57.9 million ($17.15/boe) for 1P reserves.
- Proved plus Probable (2P) reserves increased by 4% to 7.69 million boe;
- NPV-10 is $127.3 million ($16.56/boe) for 2P reserves.
- Proved plus Probable plus Possible (3P) reserve increased by 1% to 11.68 million boe
- NPV-10 is $205.8 million ($17.57/boe) for 3P reserves.
Before-tax NPV-10 values have increased by 97% for 1P and by 51% for 2P, over year-end 2021, due to reserves growth and an increase in the oil price forecast used by BouryGEC at year-end 2022.
2022 Proved Developed Producing (PDP) reserves increased by 27% to 1.31 million boe supported by the improved performance of the new drilling in the Rio Cravo Field. PDP reserves represent 39% of 1P reserves, reflecting an attractive ratio of base production to low-risk drilling targets.
Before tax NPV-10 per share was US$0.14/share, US$0.39/share, and US$0.63/share for 1P, 2P, and 3P reserve categories, respectively, with BouryGEC post-tax NPVs impacted by changes in Colombian tax regime in the year but before other corporate tax shelters.
Arrow Exploration - operating in Colombia via a branch of its 100% owned subsidiary Carrao Energy SA - has a portfolio of premier Colombian oil assets that are under-exploited, under-explored and offer high potential growth.
The company's business plan is 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. Arrow's seasoned team is led by a hands-on executive team supported by an experienced board.
Contact the author at jon.hopkins@proactiveinvestors.com