Arrow Exploration (TSX-V:AXL) has acquired a 100% working interest in an oil-producing property in Thorsby, central Canada, for C$12.15 million ($12.36 million).
The asset produces 550 barrels of oil equivalent per day and generated C$2 million of operating income in the past 12 months.
The property also holds proved reserves of 4.97 million barrels of oil equivalent (boe) and proved plus probable reserves of 7.54 million boe across 9,501 net acres.
A third-party reserve report dated 31 December 2025 values the proven (1P) reserves at C$38 million and proved plus probable reserves (2P) at 71 million on a pre-tax net present value basis, discounted at 10%.
Current production comprises 27% oil and liquids, while the reserve base contains approximately 55% oil and liquids.
As part of the transaction, Arrow assumes C$8.7 million in decommissioning liabilities.
CEO Marshall Abbott says the Thorsby acquisition represents a “low-risk, exceptional return inventory suite of development drilling opportunities”.
“The development focus is on the Cretaceous Sparky formation as a proven reservoir where management has years of geologic fluency,” Abbott says.
The lower Cretaceous Sparky reservoir averages 15m of net pay at a 9% cut-off and reaches up to 25m thick in places. Management has identified 22 drilling locations targeting the Sparky formation.
Abbott says the company plans to drill two-mile lateral horizontal wells costing approximately C$2.2 million each, with three wells per pad. The Sparky wells typically achieve initial production rates of 300 barrels of oil per day.
“Management believes that the Thorsby acquisition complements the Colombian operations very well,” Abbott says.
“This also represents very similar reserve capture and adds significant cash flow and IRRs [internal rates of return] that exceed 500% on a well-by-well basis.”
The Alberta Energy Regulator estimates 55 million stock tank barrels of original oil in place with 3% recovery to date. Arrow believes significant secondary recovery potential exists.
Arrow Exploration is a junior oil and gas company with assets in Colombia through its 100%-owned subsidiary Carrao Energy.
Write to Paula Fabe at Mining.com.au
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