Arrow Energy Ltd.

Arrow Energy Ltd.

October 30, 2006 15:18 ET

Arrow Energy Ltd.: Acquisition of 200 BOE/d

CALGARY, ALBERTA--(CCNMatthews - Oct. 30, 2006) -

(Not for distribution to United States news wire services or for dissemination in the United States)

Arrow Energy Ltd. (TSX VENTURE:AOF) ("Arrow") is pleased to announce the acquisition from Tirmoil Energy Ltd. ("Tirmoil") of approximately 200 BOE/d of production (approximately 90% light sweet crude oil), a significant sweet crude oil pipeline and approximately 132 Mboe of proved + probable reserves in the Peavine/Springburn Area of Alberta. As of Friday, October 27, 2006, Tirmoil agreed that it would immediately transfer all of its oil and gas properties and operations to Arrow in consideration of Arrow's assumption of Tirmoil's debt with the Alberta Treasury Branches of approximately $1.0 million and the grant of a 12.5% working interest in all "on settlement" production to The Peavine Metis Settlement. In addition, Tirmoil has transferred to Arrow a significant RIGHT OF FIRST REFUSAL AGREEMENT to acquire all of the assets of Husky Oil Operations Ltd. not covered by pre-existing ROFRs in Husky's "Slave/Seal Lake Area" (Twps. 81-86, Rges. 10-16 W5). This agreement is subject to Husky disposing of any/or all of these assets.

The Peavine Metis Settlement is the 100% sole owner of the shares of Tirmoil. The necessary legal and accounting work is being done to finalize the transaction. The common shares of Arrow acquired by Tirmoil pursuant to the takeover transaction that closed on September 1, 2006, will be transferred to The Peavine Metis Settlement concurrently with the closing of the acquisition, as it is intended to wind-up Tirmoil. 3,173,729 of the Arrow common shares acquired by Tirmoil have been transferred directly to individual beneficial owners of the shares for whom they were being held in trust, at no further consideration.

Chris Tesarski, President of Arrow, said "this acquisition is very timely for Arrow and fits nicely into our future strategies, it will virtually double Arrow's production. Because of the close business relationship between The Peavine Metis Settlement and Arrow, Arrow expects that it will have significant future opportunities to increase its on settlement production."

Arrow Energy Ltd. is a junior oil and gas company listed on the TSX Venture Exchange having active production and exploration operations in Northern and Central Alberta.

Certain statements contained in this press release may be considered as "forward looking". Such "forward looking" statements are subject to risks and uncertainties that could cause actual results to differ materially from estimated or implied results.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Arrow Energy Ltd.
    Chris Tesarski
    (403) 538-2110
    Arrow Energy Ltd.
    Suite 3000, 150 - 6th Avenue S.W.
    Calgary, Alberta T2P 3Y7
    (403) 538-2121 (FAX)