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Highlights

  • Arrow began drilling its first horizontal well in Alberta Llanos, with production expected in June.
  • A second rig is being mobilized for development drilling at the RCE and Carrizales Norte fields.
  • Entered a two-year crude prepayment deal providing up to GBX 20 million in financing and exclusive marketing rights to a third-party energy company.

Arrow Exploration Corp. (LSE:AXL) is a Calgary-based oil and gas company operating in Colombia through its wholly owned subsidiary Carrao Energy S.A. The company holds assets in the Llanos, Middle Magdalena Valley, and Putumayo basins.

The company has released its unaudited financial statements and management discussion and analysis for the three months ended 31 March 2025. The company reported progress on its Colombian operations, including the spudding of its first horizontal well in the Alberta Llanos field and preparations for additional development drilling across its portfolio.

Arrow commenced drilling operations on the AB HZ4 well in the Tapir Block, its first horizontal well in the Alberta Llanos field. Production from the well is expected to begin in June, followed by a second horizontal well on the same pad. Two vertical wells, CN HZ10 and CN11, were brought into production during the quarter.

To support its 2025 drilling program, Arrow has secured a second rig that will initially be deployed to the Rio Cravo Este (RCE) field. Up to four development wells are planned at RCE before the rig moves to the Carrizales Norte pad for further drilling. The first RCE well is anticipated to spud in early June.

The company reported Q1 2025 average production of 4,085 barrels of oil equivalent per day (boe/d), comprised of 3,770 barrels per day (bbl/d) of crude oil and 1,851 thousand cubic feet per day (Mcf/d) of natural gas, along with minor volumes of natural gas liquids. This represents a 50% increase from Q1 2024 levels but a 14% decline compared to Q4 2024.

Water handling capacity is being expanded to address increased water production. AB2 has been converted into a water disposal well and is expected to become operational in late Q2, while CN5 is targeted for conversion and operation in Q3. Additional infrastructure upgrades are underway to enable higher pump rates on curtailed wells and support further drilling.

Arrow also completed a 90 km² 3D seismic survey in the southeastern portion of the Tapir Block. The processed data will support prospect identification for the 2026 drilling program.

During the quarter, Arrow entered into a two-year crude prepayment agreement with an integrated energy major. The agreement includes up to US$20 million in prepaid crude sales in year one, reducing to GBX 15 million in year two. The energy company will become the exclusive marketer of Arrow's Colombian oil production under the terms of the agreement. This financing will contribute to the company’s planned 2025 capital expenditure program of approximately GBX 50 million, of which GBX 11.4 million was spent in Q1.

As of 1 May 2025, Arrow reported cash balances of GBX4 million.

On a YTD basis, Arrow Exploration Corp. shares have decreased approximately 32.61%.