Oil and Gas Co.'s Net Cash Expected to Triple by 2024
Research Report

Arrow Exploration Corp. (AXL:TSX.V; AXL:LSE) has released reports for its 4Q22 results.

Stephane Foucaud of Auctus Advisors reports that the company has performed within expectations.

Arrow managed to lower operating costs compared to the same quarter in 2021 and ended the year with a cash balance of US$13 million.

Foucaud notes that the company was able to recoup losses, writing, "Impairment losses of ~US$9 million were reversed, mostly due to higher commodity prices having a positive impact on the value of the reserves at Capella."

Upcoming Catalysts

Foucaud reports company expectations for 2023.

In the May 2, 2023, research report, Foucaud notes that Arrow is slowly ramping up drilling efforts at new and existing wells:

The company continues to expect to drill at least ten wells in 2023 (of which three have already been drilled). Arrow is currently moving its drilling rig to the Carrizales Norte field, where the first well will spud shortly.

Two further wells will be drilled on the field. At least two Gacheta wells will then be drilled on the Rio Cravo Este field. Two wells at Oso Pardo will also be drilled.

Meanwhile, in the Llanos Basin, one of the largest 3D seismic surveys in years has been completed at West Tapir. Results are promising, and Arrow expects to be able to drill there for the next one to two years.

It is predicted that Arrow will continue to produce approximately 5,000 barrels of oil per day by the end of this year, leading Foucaud to reiterate the target price of £0.45 per share.

Structure and Predictions

Foucaud noted, "We forecast that the company will hold >US$20 mm in net cash at YE23 and ~US$60 mm at YE24 under our Brent price assumptions. This represents ~100% of the current market cap."

This research report shares recent rating and target price information as well as current market data on the company:

• Price: £0.18
• Price Target: £0.45
• Market Cap: US$66 million

Arrow currently has 307 million diluted shares.

Important Disclosures:

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Disclosures for Auctus Advisors, Arrow Exploration, May 2, 2023

Arrow Exploration Corp. (“Arrow” or the “Company”) is a corporate client of Auctus Advisors LLP (“Auctus”). Auctus receives, and has received in the past 12 months, compensation for providing corporate broking and/or investment banking services to the Company, including the publication and dissemination of marketing material from time to time. MiFID II Disclosures This document, being paid for by a corporate issuer, is believed by Auctus to be an ‘acceptable minor non-monetary benefit’ as set out in Article 12 (3) of the Commission Delegated Act C(2016) 2031 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. It is produced solely in support of our corporate broking and corporate finance business. Auctus does not offer a secondary execution service in the UK. This note is a marketing communication and NOT independent research. As such, it has not been prepared in accordance with legal requirements designed to promote the independence of investment research and this note is NOT subject to the prohibition on dealing ahead of the dissemination of investment research. Author The research analyst who prepared this research report was Stephane Foucaud, a partner of Auctus. Not an offer to buy or sell Under no circumstances is this note to be construed to be an offer to buy or sell or deal in any security and/or derivative instruments. It is not an initiation or an inducement to engage in investment activity under section 21 of the Financial Services and Markets Act 2000.

Note prepared in good faith and in reliance on publicly available information Comments made in this note have been arrived at in good faith and are based, at least in part, on current public information that Auctus considers reliable, but which it does not represent to be accurate or complete, and it should not be relied on as such. The information, opinions, forecasts and estimates contained in this document are current as of the date of this document and are subject to change without prior notification. No representation or warranty either actual or implied is made as to the accuracy, precision, completeness or correctness of the statements, opinions and judgements contained in this document. Auctus’ and related interests The persons who produced this note may be partners, employees and/or associates of Auctus.

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