Arrow Exploration Corp. · TSXV:AXL
Arrow Exploration — Investor Presentation (March 2023)
35 slides from Arrow Exploration's investor presentation, Mar 8, 2023
Slide 1: Growing & Socially-Responsible Colombia-Focused Energy Company
ARROW EXPLORATION Growing & Socially-Responsible Colombia-Focused Energy Company AIM|TSXV : AXL March 2023 Corporate Presentation Unless stated otherwise, all dollar figures refer to US dollars ARROW EXPLORATION CORP. (TSXV | AIM : AXL)
Slide 2: Disclaimer
Disclaimer IMPORTANT INFORMATION The content of information contained in this presentation (the “Presentation”) has not been approved by an authorised person within the meaning of the Financial Services and Markets Act 2000 (“FSMA”). Reliance upon this Presentation for the purpose of engaging in any
Slide 3: Arrow Exploration
Arrow Exploration Growing & Socially-Responsible Colombia-Focused Energy Company 550 $150 2 → 6 7.9 million opportunity rich Columbian 3,000 additional low- risk wells by H1 Mmboe 2P reserves – Q2 2P reserves – Q2 basins boe/d within 18 2023 review review months Seasoned Pursuing Compelling executiv
Slide 4: Corporate Snapshot
Corporate Snapshot RCS-1 on East Pepper on RCE-2 on production production production Completion of AIM West Pepper P listing/financing well on Operational e production update n Interim results c announcement e Institutional 33.4% Share Ownership Market at January 1, 2023 Retail 22.0% Canacol 19.5% $
Slide 5: 2023 Board Approved Budget
2023 Board Approved Budget Funded through cash balance and operations cash flow. No external funding sources required. 10 well drilling program • 3 C7 wells at RCE, each expected to add 300-500 bbls/d net to Arrow. • 3 wells at Carrizales Norte, each expected to add 300-500 bbls/d net to Arrow. • 2
Slide 6: Seasoned Executive Team and Board
Seasoned Executive Team and Board 190+ years 8 companies TSX / TSX-V / AIM 15+ Combined management experience Founded → grown → sold Public company expertise O&G jurisdictions worked in P. Gage Jull Marshall Abbott Grant Carnie Anthony Zaidi Ravi Sharma Executive Chair CEO & Director Senior NED (I)
Slide 7: Committed to ESG Best Practices
Committed to ESG Best Practices Environment Committed to limiting our impact on the climate, air, land and water by adhering to the highest standards of industry operating practices; support principles included in the UN’s Sustainable Development Goals. Community Involvement Develop community partne
Slide 8: ESG In Action
ESG In Action Community Program: Aguachica (Communities of Loma de Corredor and La Ye Village) In 2022, the Tapir operations have spent more than $3 million with local companies and over $450,000 on social and environmental projects. Water improvement Aqueduct improvement La Ye Village School Constr
Slide 9: Colombian Oil & Gas Industry
Colombian Oil & Gas Industry Key Takeaways Attractive Great Brent Oil Fiscal Terms Infrastructure Pricing Government very Abundant supportive of the oil infrastructure with Excellent pricing and gas industry spare pipeline based on Brent less (40%+ country’s capacity and no Vasconia Differential exp
Slide 10: Attractive Fiscal Terms
Attractive Fiscal Terms Still top decile fiscal regime worldwide. 80.0% 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% USA (Texas) Colombia Argentina Brazil Bolivia Canada (Alberta) Peru Mexico Royalty Tax PAGE 9
Slide 11: Asset Overview
Asset Overview Current Production Operator Asset Country Basin W.I. Capacity(3) Colombia Sedimentary Basins (boe/d, net) Middle (1) Magdalena 1. Tapir Colombia Llanos 50% 1,500 Arrow(2) Valley 2 Core Assets 2. Oso Pardo Colombia MMV 100% 145 Arrow Bogota 1 LLanos Arrow & 3. Alberta Canada WCSB 100%
Slide 12: 2022 Mid-End Reserves
2022 Mid-End Reserves 06-30-2022 Price Deck Year $/bbl Brent 2022 110.00 $223,626 11,759 2023 94.00 2024 85.00 2025 81.00 2026 82.62 2027 84.27 2028 85.96 2029 87.68 7,863 $150,428 2030 89.43 2031 91.22 2032 93.04 2032+ +2% per year 3,568 $77,705 1P (Mboe) 2P (Mboe) 3P (Mboe) 1P (NPV10%) 2P (NPV10%)
Slide 13: Colombian Oil Portfolio: Llanos Basin
Colombian Oil Portfolio Llanos Basin ARROW EXPLORATION CORP. (TSXV | AIM : AXL)
Slide 14: Llanos Basin
Llanos Basin The ‘Park Avenue’ of Colombia’s Oil Industry – Safe, Secure and Highly-Desirable The Tapir Block in the Llanos is surrounded by some of the largest producers in Colombia • Parex: 51,143 boe/d • Frontera: 41,586 boe/d • GeoPark: 35,465 boe/d • Gran Tierra: 29,493boe/d • Perenco: 21,000 b
Slide 15: Tapir Block: Proximate Field Production
Tapir Block: Proximate Field Production 38.5 MMbbls Produced1 RUNNING ROOM Leads identified to date have the potential to be 2,000 – 3,000 bbls/d each Mateguafa Updip Mateguafa-4 Well Mateguafa-3 Well Mateguafa-1 Well Mateguafa-2A Well Mateguafa Oeste Capullo Corozos Sardinas 13.7 MMbbls Cum. Produc
Slide 16: Tapir 3D Seismic in Progress - Q1 2023
Tapir 3D Seismic in Progress - Q1 2023 PAGE 15
Slide 17: Tapir Block: Features and Opportunities
Tapir Block: Features and Opportunities 1 Key Characteristics … 2 … Drive Opportunities Excellent subsurface fundamentals Multiple prospects plus additional follow-up wells on success Multiple high-quality reservoir targets Type-wells can deliver initial production (IP) of over 1,000 bbls/d Multiple
Slide 18: Tapir Block (50% W.I.)
Current & Future Production Tapir Block Potential Production (net to Arrow) Tapir Block (50% W.I.)* Type well IP forecast (per zone):360 bbls/d, net Overview Payback*: 3 months CF (Yr1)*: $8.8M, net • RCE 2021 year-end 3P reserves of 3.8 MMbbls (gross) / 1.9 MMbbls (net to Arrow’s W.I.) Well cost: $
Slide 19: Rio Cravo Este Development Concept
Rio Cravo Este Development Concept PAGE 18
Slide 20: Carrizales Norte Development Concept
Carrizales Norte Development Concept PAGE 19
Slide 21: Colombian Oil Portfolio: MMV Basin
Colombian Oil Portfolio MMV Basin ARROW EXPLORATION CORP. (TSXV | AIM : AXL)
Slide 22: Oso Pardo Field (100% W.I.)
Current Production Oso Pardo Field (100% W.I.) Overview Oso Pardo Site Photos • Discovered in 2013 by Canacol; discovery well (Oso Pardo-1) had an IP of 200 bbls/d from stacked sands of the Umir formation • 2 appraisal wells drilled in 2014; 150 ft proven oil column to Lowest Known Oil (LKO) • Accor
Slide 23: Oso Pardo Extension (100% W.I.)
Future Opportunity Not Factored Into Production Forecast Oso Pardo Extension (100% W.I.) Existing block does not require a bid process Overview Oso Pardo Extension Potential Production Profile* • Gaffney, Cline & Associates reserve study* snapshot: GCA Cases Oil EUR/well (Mbbl) Capex ($M) Pre-Tax NP
Slide 24: Oso Pardo Development Concept
Oso Pardo Development Concept PAGE 23
Slide 25: Western Canada Gas: Montney
Western Canada Gas Montney ARROW EXPLORATION CORP. (TSXV | AIM : AXL)
Slide 26: Why Western Canada?
Why Western Canada? 1.8 Optionality 447 TCF marketable Tcf of Gas West Pepper tied-in at 1,100 boe/d IP Efficient payout on Arrow’s on realizing value from Initially-in-Place Arrow’s gas in the total in Arrow’s East Pepper well wells Montney play Montney lands tied-in assets Benefits Diversifies fro
Slide 27: Canadian Montney Assets
Current & Future Production Canadian Montney Assets Overview • Low-risk, low-cost, behind-pipe natural gas discovery; production in a rising gas price environment in Alberta, Canada • Arrow tied-in the 3-26 West Pepper Montney well in December 2021 at a cost of $1.3 million, adding initial productio
Slide 28: Near Time Catalyst
Near Time Catalyst Complete In Progress Future Drill up to 4-5 Rio Drill the high- Successful 3D on the Tapir impact Carrizales Drill 2 Gacheta Oso Pardo Pivot into low-risk Cravo Este wells Accretive M&A financing and Norte prospect wells Extension exploration drilling on Tapir Block, Block listing
Slide 29: Appendix
Appendix ARROW EXPLORATION CORP. (TSXV | AIM : AXL)
Slide 30: Continued Success with Rio Cravo Este-3
Continued Success with Rio Cravo Este-3 • The RCE-3 appraisal well spud on Feb 8th and was placed on production Feb 28th Forecast Net Pay API Zone Production Rate • The well encountered a total of 58 feet net oil (47 feet (ft TVD) Gravity (bbl/d) * TVD) within the Carbonera C7 and Gacheta C formatio
Slide 31: Rio Cravo Este-2 Appraisal Success
Rio Cravo Este-2 Appraisal Success Adding Material Production and Reserves Forecast RCE-2 spud on April 2, on production May 23 Net Pay Test Rate API • Zone Production Rate (ft TVD) (bbl/d) * Gravity • Well was drilled closer to fault and formation tops are (bbl/d) * 15 to 40 feet higher than RCE-1
Slide 32: Rio Cravo Sur-1 Appraisal Success
Rio Cravo Sur-1 Appraisal Success New Producing Zones Encountered Forecast RCS-1 spud on May 23 and on production as of June Net Pay Test Rate API • Zone Production Rate (ft TVD) (bbl/d) * Gravity 29, 2022 (bbl/d) * • The well was drilled 1.3 km south of existing wells and Carbonera C7A 14 N/A N/A N
Slide 33: Carrizales Norte Prospect (50% W.I.)
Future Production Carrizales Norte Prospect (50% W.I.*) Overview Carrizales Norte Potential Production (net to Arrow) • Carrizales Field: 1,600 • Discovered by C&C Energia in 2007 with the Carrizales-1 well – led to $500 million sale of C&C. • 24 wells drilled to date; as of December 2019, the field
Slide 34: Ombu Block (10% W.I.)
Non-Operated Production Ombu Block (10% W.I.) Overview • 10% working interest in the Ombu Block which contains the Capella discovery, the largest oil discovery in Colombia in the past 20+ years • Emerald Energy (Sinochem) is the operator • 2020 Year-End Arrow 2P reserves of 4.0 MMbbls of 8–11degree
Slide 35: Corporate Information
550, 333 – 11th Ave SW Calgary Alberta T2R 1L9 Marshall Abbott CEO T: 1 (403) 651 5995 E: [email protected] Corporate Information Joe McFarlane CFO T: 1 (403) 818 1033 E: [email protected] Auditors: Ernst & Young Legal Counsel: Gowling WLG (Canada) LLP NOMAD: Canaccord Genuity
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