Arrow Exploration Share Discussion Threads

[rockyride] 14/9/2024 15:41

HAT - absolutely STUNNING post, thank you.

[here and there] 14/9/2024 14:35

The model has worked for him so far so why change it? He's made v good money over the years. I have met with Marshall many times, he loves the business, he is also very technical, he really understands every technical aspect of the business.
The board all earnt 'sweat equity' the first year or two, took their wages in stock and have upped their earnings and options as the company has delivered. They are all making good coin and are v incentivised over getting the sale of the company done at the best possible price.

They have these technical meetings every morning involving all the main guys in colombia and Calgary, they go over the detail of everything, plans change often according to circumstance. Because it is a small cap company and the boss is technical and involved day in day out, they can be flexible and move quickly.

The new presentation is really interesting, plans and priorities always change from quarter to quarter. We've seen that repeatedly. The drilling inventory is vast.

They have a real first world problem at the moment. The balance between maintaining and growing production, and exploration drilling to grow reserves and producing reserves quickly (herein lies the value and premium valuations a sale will command), keeping the cash in the bank nice and high to provide a cushion against any problems, and increasing costs by taking on a second and even third rig. They are running hard, how much harder can they run? I'm pretty sure we will see a second rig in Q1 2025 though the recent wobble in the oil price might delay that decision a wee bit until they get better clarity on the oil price direction of travel.

The whole team are in town this week, I look forward to seeing a few pesentations both virtually and in person. Any questions you have I will try and get answered. There will be the proactive presentation on Thursday and Malcy will be doing one of his interviews.

For those nervous about the oil price, remember the the net backs are still fabulous at $70 oil. I think they are profitable all the way down to $40 oil.

Some other news. The lorry strike that was affecting some of the bigger producers is over. Government struck a deal with the unions. Luckily Arrow was completely unaffected by the strike, no production was curtailed.

hxxps://www.aljazeera.com/amp/news/2024/9/6/road-blocks-lifted-as-colombia-reaches-deal-with-striking-truckers

It's not often you get to invest in a properly run company with great assets in a great jurisdiction. Doubling revenues every year and growing the reserves apace. This is a mighty rare thing. I've been here from the beginning (IPO) and will be here until the end. That's how you make the most returns in quality growth companies

[pastybap] 14/9/2024 10:32

One question I would have regarding MA, and maybe someone could ask at some point. He has successfully built and sold 8 companies. Why does he still use public markets to do this, while maintaining fairly small stakes? If it had been me, I would have reinvested and compounded those gains within a privately owned O&G company worth hundreds of millions if not billions.

[mount teide] 14/9/2024 10:07

Over a 2-3 year investment outlook, high quality research should, on the balance of probabilities, strongly suggest that by any objective standard the investment risk/reward at 27.5p is considerably better than when the company came to AIM three years ago at 6.25p.......as at that time, Arrow's huge, primely located Tapir Block in Colombia's most important O&G basin, while having significant potential, had just a handful of legacy exploration wells drilled on it and some aged 2D seismic of very modest quality.

So, many who supported the Arrow IPO will most likely have done so on the basis of CEO Marshall's long track record of astutely buying, growing and selling each of his 8 previous O&G companies for a highly material capital gain......a remarkable achievement when considering it required delivering growth at every stage of the commodity market cycle.

AIMHO/DYOR

[royalalbert] 13/9/2024 20:42

Anyone new to this share and reading that presentation would think this is cheap I'll buy some (as long as they do their due diligence).

2025 bring it on.

[dunns_river_falls] 13/9/2024 13:38

At 1st glance, I see more details on C7 drilling locations
New production profile graph for Hz1 - looks useful
Slide 17 shows potential new HZ locations to the north of existing HZ wells
New slide - pg 24. Shows potential location of 4 new HZ drills running SW to NE?
Slide 31 - shows more RCE potential drill locations
Slide 32 - interesting new data on prospect inventory and rankings. 40 potential drills ranked.

[king suarez] 13/9/2024 12:58

There is an updated presentation out:



I have just been totting up the numbers from page 31 for forthcoming drills. If all the leads and developments come good as per those numbers it equates to an additional 23.4k bopd and $565m NPV10 at a drill cost of $78.15m :)

2025 is going to be quite exciting if there is the potential for HZ developments at some of the other prospects as modelled - fingers crossed!

[dunns_river_falls] 13/9/2024 11:38

Agree with 40p as a reasonable target by year end. Net rev for Q4 could be in the region of $23m. Based on the current miserly DCF rating of circa 1.4, that would be around 40p.
However if we can bridge the gap to peers who trade on a P/DCF of 2.5, we could see upside to 61p. So my guess would be a range 35p - 45p by year end. 50p would be a lovely xmas gift! Year end cash in bank - I think $20m will be possible.
I have been pretty aggressive with my forecasts for HZ well decline rates until we know more, but I think a year end exit rate of 6,600 BOPD if they can get that 7th HZ on stream in time. Perhaps as high as 7,500 if the AICD's are beneficial + if other production is brought back online. We will see!

[upwego] 13/9/2024 11:02

I`m thinking 40p minimum year end. BWTFDIK :)

[78steve] 13/9/2024 09:56

We all thought this was going to be at mid 30s by now not mid 20s even so if we end up mid 30s by eoy that would be good result from where we are now imo.

[chessman2] 13/9/2024 09:54

Without doubt, the share price will be a lot higher as we will be closer to 10,000 BOPD which means the predators in the area will be watching us more closely.

[rockyride] 13/9/2024 09:04

Unlike most other companies, in the main we only have 2 moving parts, POO & BOEPD. So with POO forecast to return above $80 and 3 more Horizontal wells to come within the next 2 months or so, it will be very interesting to see what the share price is at on 31/12/24.

[pastybap] 13/9/2024 08:45

As much as I like him and his running of the company, when it comes to his interviews, I like to include what I call the MA discount factor to any of his numbers!

[upwego] 13/9/2024 08:23

On the time of the announcement he mentions cash was about $12m cash, and in this interview he mentions they are well North of that, so I would imagine on the next well by the time we get the results we should have £13m cash or could even be close to £14m with no debt, drilling to increase production, and increasing the FCF..

I really like this drilling campaign and the assets.

[beaks44] 12/9/2024 12:14

Yes, if it takes same as last well from spud to production we are looking at next friday 20th. They have a presentation event on 19th. Exciting times!

[chessman2] 12/9/2024 09:47

RR, yes I also think the BOD has recognised the bottom so I put my hand down the back of the sofa to find even more cash to increase my shedload.

I also agree that it bodes well for HZ5. Not long to wait for such news.

[upwego] 12/9/2024 09:31

cracking price at the minute think the bottoms been hit.

Bring on the next HZ well :)

[rockyride] 12/9/2024 08:38

And FWIW I guess the BOD see the current share price as somewhere close to the bottom as they issued the options this morning. Also bodes well for how HZ5 is going. I'm fully locked and loaded but I suspect the current price is a good entry level or for top-ups.

[oakville] 12/9/2024 08:37

I thought the share price was going too well, always rely on a bit of greed to put the brakes on. Bought another 20k shares to average down slightly.

[king suarez] 12/9/2024 08:33

I hope they make at least 50p a share profit on those options :)

[royalalbert] 12/9/2024 07:39

On the positive side less than 1m options left to give out (10% issued shares).

IMHO.

[pastybap] 12/9/2024 07:34

I dont mind market price options as a reward for management performance. The sceptic in me does notice how wonderful the timing is for the recipients though!

[rockyride] 12/9/2024 07:34

I'm a fan of rewarding personnel well in successful companies but I also like to see them showing some commitment as well. These options vest at today's pice of 26.8p (47.5c / 1.77 fx) but why can't these people along with MA put their hands in they pockets and buy some at todays price as well.There are no targets / milestones / hurdle prices linked to these incentives which is also very poor IMHO. They should have production growth hurdle prices linked to the plan or some other challenging target.Making money out of this incentive plan is akin to shooting fish in a barrel - and barring World War 3 or some other major disaster - these lucky people simply can't fail to make money out of this.My final point is that's they never end up buying them anyway when they exercise them on a cashless basis. So when they vest they take away 26.8p from the price at that time, they dont buy the shares and simply pocket the difference in the 2 prices.PS - great how they always spy their chances on reasonable size dips too. These folk are likely to be showing a paper profit from the next RNS until their vesting dates.

[tag57] 12/9/2024 07:29

Joe is obviously a tough one to motivate!

[che7win] 12/9/2024 07:12

Joe Mcfarlane got 1.2m on April 30th, barely 4 months ago.