Arrow Exploration Corp. (AIM: AXL): Good flow rate at M-11. Very strong performance at Mateguafa Attic Hz wells
• The M‑11 well has been brought online from the C7 formation, which contains 18 ft of net pay, at 784 bbl/d (392 bbl/d net) with a 26% water cut. The well also intersected ~30 ft of net oil pay in the C9, which will be brought into production at a later stage.• Net production from the M‑7 and M‑9 horizontal wells has increased materially, rising from 625 bbl/d and 425 bbl/d to 1,008 bbl/d and 693 bbl/d, respectively, following pump‑speed optimisation. This performance is encouraging ahead of the next horizontal well, M‑12.
• Horizontal wells at Mateguafa Attic are producing from the C9 formation, which is thicker than the C7. The operator plans to open the C9 at M‑10 and M‑11, enabling commingled C7+C9 production, which could further enhance rates.
• Positive drilling and production results at Mateguafa Attic have derisked two additional drilling locations, for which new cellars will need to be constructed.
• A new CPR is expected mid‑year, incorporating the recent drilling and performance at Mateguafa Attic.
• Corporate production is ~5,475 bbl/d, up from 5,325 bbl/d last week.
• We reiterate our target price of £0.45/sh. The next key catalyst is the Icaco exploration well, which carries an unrisked NAV of £0.13/sh.
Icaco
Following M‑12, the drilling rig will mobilise to the Icaco prospect, where we carry 3.7 mmbbl of net prospective resources. Arrow has already constructed five drilling cellars, enabling an immediate continuation of the programme in the event of success.
Valuation
On 1 March, Arrow held US$6.4 mm in cash. Our Core NAV is £0.32 per share with a ReNAV of £0.44 per share, reflecting US$70/bbl for Brent from 2Q27.
Front Range Resources is engaged in oil and natural gas exploration and production focusing on horizontal multi-stage frac development in Montney, Bluesky, Wilrich and Falher formations in the Deep Basin area of west central Alberta.
Auctus Advisors is a specialist Equity Capital Markets and Advisory business with a focus in the Energy Sector.
The partners have complementary skill sets, with decades of experience across Equity Capital Markets, Investment Banking and the Energy industry. We have worked at Société Générale, Canaccord Capital, BMO Capital Markets and Schlumberger. Most recently we have worked together for many years at GMP FirstEnergy.
Auctus has been set up at the beginning of a new decade in which we see significant opportunities in the Energy space. Globally, demand for energy is at record levels and continues to grow. Conversely, investment in traditional energy sources has been severely constrained. We believe this imbalance creates opportunities for both companies and investors.
Auctus provides Corporate Broking, Equity Research and Investment Banking services.
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