Arrow Exploration Corp. (AXL) , a Colombia-focused hydrocarbon explorer, announced its interim results for the three and nine months ended September 30, 2023.
In Q3 2023, highlights included a nearly doubled total oil and natural gas revenue of $13.9 million compared to the same period in 2022, resulting in a net income of $7.1 million and adjusted EBITDA of $9.8 million, both more than doubling from 2022 figures. The corporate production saw a 68% rise to 2,518 boe/d, with realised corporate oil operating netbacks at $52.67/bbl.
The post-period end activities comprised successful drilling endeavors such as Rio Cravo Este-6 (RCE-6) and Oso Pardo-3 (OP-3), alongside ongoing or upcoming projects like RCE-7 testing, OP-4 drilling, and warrant-based cash inflow, boosting the company's cash position to $18.5 million by November 1, 2023.
Looking ahead, Arrow has plans to drill additional wells at Rio Cravo Este (RCE) and the Oso Pardo Block, with a detailed development blueprint for Carrizales Norte (CN) consisting of 21 wells, mostly focusing on the Ubaque formation to optimise reservoir exploitation. Looking ahead to 2024, the company aims for a $40 million capital program, emphasising Carrizales Norte's expansion, including three horizontal wells, alongside low-risk exploration wells at the Mateguafa Attic and Baquiano prospects, entirely self-funded by operational cash flow and reserves.
View from Vox
A strong set of results from Arrow across the board, which has delivered its strongest quarter to date. The company is executing its business plan well, expanding oil production from some of Colombia's most active basins, including the Llanos, Middle Magdalena Valley (MMV) and Putumayo Basin. Its 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.
Looking forward, the continued strong production rates from existing tied-in wells along with encouraging results from new wells will help Arrow to deliver impressive figures into 2024 and beyond.
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