Arrow Exploration (AIM:AXL) announced the acquisition of a producing oil property in Thorsby, Central Alberta, for C$12.15 million (approximately $8.9 million), paid from existing cash reserves.
The AIM and TSXV-listed company operates a portfolio of assets across Colombian hydrocarbon basins and this deal now adds its first Canadian asset.
The Thorsby property produces 550 barrels of oil equivalent per day (boepd) with a 15% decline rate and generated approximately C$2.0 million of operating income over the last 12 months.
The asset spans 9,501 net acres and includes all associated infrastructure, with management identifying 22 drilling locations in the lower Cretaceous Sparky reservoir, each expected to cost around C$2.2 million per well.
Chief executive Marshall Abbott said the wells "have high initial production (300 BOPD) rates with low declines and pay out very quickly"
A third-party reserve report dated 31 December 2025 puts proved reserves (1P) at 4.973 million barrels of oil equivalent (boe) and proved plus probable reserves (2P) at 7.537 million boe, with pre-tax net present values of C$38 million and C$71 million respectively.
Abbott added that the geology mirrors Arrow's Colombian operations, both featuring three-way structural traps against a sealing barrier, offering well-by-well internal rates of return exceeding 500%.
The company said it remains debt-free following the acquisition.
Arrow is assuming decommissioning liabilities of C$8.7 million as part of the deal.
News Intelligence what this means for the company
Arrow Exploration has deployed C$12.15 million (~$8.9 million) in cash to acquire its first Canadian asset—a producing Alberta property generating 550 boepd with 22 identified drilling locations—reducing its cash position from the $27.5 million reported as of 1 August 2026 to approximately $18.6 million. The deal is accretive on paper (proved reserves valued at C$38 million pre-tax NPV, annual operating income of C$2 million), but commits material capital to a new geography and requires execution on 22 wells at C$2.2 million each to realize the upside.
The acquisition diversifies Arrow beyond Colombia and adds near-term cash generation, but shifts focus and capital allocation away from the Colombian portfolio that has been the company's core. At $8.9 million deployed against a $27.5 million cash base, the company retains dry powder and remains debt-free. A new 22-well programme would potentially require either cash generation from the property itself or external funding to execute fully.
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