Arrow Exploration Corp (TSX-V:AXL, AIM:AXL, OTC:CSTPF) has reported its interim, unaudited third-quarter financials which showed the company had strong revenue and production thanks to its core assets in Colombia — the Tapir Block and the Oso Pardo Field – which provide the company with low-cost production and an inventory of low-risk exploration opportunities.
For the period ended September 30, 2021, the Calgary, Alberta-based high-growth operator with a portfolio of assets across key Colombian hydrocarbon basins, reported average production of 575 barrels of oil equivalent per day (boe/d), an increase of 244 boe/d, or 74%, compared to 2Q 2021 average corporate production of 331 boe/d.
“The increase in production quarter-over-quarter was largely attributable to a full quarter of production following the re-start of the company’s Oso Pardo field in late-2Q 2021, and its share of increased production from Ombu (Capella), both located in Colombia,” said Arrow in a statement. It also chalked up higher production to an increase in its share of natural gas production from certain Canadian assets.
READ: Arrow Exploration starts trading on the London Stock Exchange’s AIM market
During the quarter, the company successfully executed on several initiatives to continue increasing its production and cash flow, including re-starting production from the Oso Pardo-1 and Oso Pardo-2 wells, located adjacent to the Morsa-1 well, and adding current combined production of approximately 18 bbls/d.
It is also executing on field activities associated with the planned tie-in of behind-pipe natural gas from the 3-26 Well located at West Pepper, Alberta.
Arrow Exploration reported total natural gas and crude oil revenue, net of royalties of US$1,684,609 for the quarter, compared to US$207,934 for the same period a year earlier.
Meanwhile, the company reported total natural gas and crude oil revenue, net of royalties of US$3,473,661 for the nine months ended September 30, 2021.
Arrow saw an increase in operating netbacks during the quarter to $30.73 per boe, compared to $22.37/boe in Q2 2021. The increase in operating netbacks on a sequential quarterly basis was chalked up to higher Brent crude and AECO natural gas prices, which resulted in higher revenues per barrel of oil equivalent sold, and lower operating expenses linked to the company’s production, which decreased to $16.54/boe during the quarter from $24.58/boe in 2Q 2021.
The company said it did not incur material capital expenditures during the quarter. At the end of 3Q 2021, Arrow had a positive working capital position of $0.8 million, and a cash position of $5.5 million.
On October 20, 2021, the company announced that it had conditionally raised approximately GBP8.8 million (C$15 million), through a placing and subscription for new shares with investors, Canacol Energy Ltd (TSX:CNE)., and executive management, in conjunction with admission of the company’s common shares to trade on AIM. Arrow’s shares continue to also trade on the TSX Venture Exchange.
The company also said it has successfully raised C$395,375 on a non-brokered private placement basis through the issuance of 3,765,476 new shares. Investors will receive one warrant for every two new common shares subscribed, exercisable for 24 months from the closing date. Arrow intends to use the funds raised from the non-brokered private placement to drill two wells at Rio Cravo Este, and in drilling the Carrizales Norte-1 exploration well.
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