Arrow Energy Ltd.

Arrow Energy Ltd.

November 08, 2006 14:38 ET

Arrow Energy Ltd.: Potential Drilling & Completions Activity

CALGARY, ALBERTA--(CCNMatthews - Nov. 8, 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 its participation with Husky Oil Operations Limited in two projects in the Peavine/Seal Lake Area. Arrow and Husky's participation in the projects is pursuant to the Exploration and ROFR Agreement signed between the two companies on October 20th, 2006.

The first project is pursuant to the Farmout & Pooling Agreements effective November 1st, 2006 which contemplate that Arrow will pay 100% of the completion and tie-in costs of bringing on production of the 11-2-79-16 W5 and/or 3-11-79-16 W5 wells to earn a 50% Working Interest in the wells. Husky will pay all costs to "re-test" these wells which will determine whether Arrow will bring on one or both of the wells. Previous production tests show 1-1.5 MMcf/d (1 million cubic feet of gas per day) of Bluesky gas potential in each of the two wells.

The second project is pursuant to an agreement effective Friday, October 27, 2006, wherein Tirmoil Energy Ltd. ("Tirmoil") agreed that it would immediately transfer all of its oil and gas properties and operations to Arrow. Arrow and Husky have entered into a Farmout & Participation Agreement with regard to the drilling of a Slave Point oil well on The Peavine Metis Settlement on Sec. 19, 79-16 W5. Arrow owns 100% of the mineral rights. Husky will pay 60% of costs to earn a 50% interest prior to a 25% casing point election to the Metis Settlements General Council. The drilling program is subject to the granting of a continuation of the Lease by the AEUB.

Should these programs be successful Arrow estimates an increase in production of approximately net 150-200 BOE/d. This would bring Arrow's daily production levels to approximately 5-600 BOE/d by the end of Q1 2007. It also increases Arrow's profile as an operator in the area because Arrow will assume operation of all the wells upon completion.

BoEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

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.

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)