Mr. Marshall Abbott reports

ARROW ANNOUNCES IC-3, IC-4HZ, AND IC-5HZ WELL RESULTS

Arrow Exploration Corp. has provided an update on operational activity at the Icaco field on the Tapir block in the Llanos basin of Colombia, where Arrow holds a 50-per-cent beneficial interest.

Icaco-3 well

The Icaco-3 well (IC-3) was spudded on July 2, 2026, and reached target depth on July 9, 2026. The IC-3 well was drilled, on time and under budget, to a total measured depth of 7,710 TMD feet (total measured depth), or 7,622 TVD feet (true vertical depth), and encountered multiple hydrocarbon-bearing intervals.

Log analysis shows 18 feet of net pay in the Carbonera C7 formation, 12 feet of net pay in the Gacheta formation and 20 feet of net pay in the Ubaque formation, for a total net pay of 50 feet TVD.

The well is currently producing from the Gacheta formation at a restricted rate, 19/128ths0inch choke and 38-hertz pump frequency, of approximately 250 barrels of oil per day gross (125 bopd net). The oil quality is 25.3 degrees API and there is a water cut of lower than 1 per cent.

Management considers the Gacheta production a very important feature in the Icaco discovery not only to prove reserves but also to determine the optimum way to develop the formation and maximize recovery from future wells. The results of the IC-3 production test will be reflected in reserves additions for Arrow at the next reserve report update.

Icaco-4 horizontal well

The Icaco 4 horizontal well (IC-HZ4) was spudded on June 13, 2026, and reached target depth on June 25, 2026. The IC-HZ4 well was drilled, on time and under budget to a total measured depth of 12,617 feet TMD, or 7,297 feet TVD, and encountered multiple hydrocarbon-bearing intervals.

Arrow put IC-HZ4, a short horizontal well, on production on July 2, 2026, in the Ubaque formation. The pay zone is a clean sandstone exhibiting an average porosity of 23 per cent with high resistivities. An electric submersible pump (ESP) has been inserted in the well after perforating. During the cleanup period, the well reached a maximum rate of 799 bopd gross (399 bopd net) before settling into the current stable production rate of 150 bopd gross (75 bopd net).

Although logs are showing extended areas with high oil saturation along the horizontal section, management believes that, during the completion operation, ICD (inflow control device) valves were placed too close to a water-bearing zone, causing the water to overtake and reduce the oil production in the well. Management is looking at alternatives to maximize oil production efficiency in this well.

The IC-HZ4 well also encountered approximately 23 feet of net oil pay TVD in the C7 formation and 10 feet of net oil pay TVD in the Gacheta formation.

Icaco-5 horizontal well

The Icaco 5 horizontal well (IC-HZ5) was spudded on July 16, 2026, and reached target depth on July 27, 2026. The IC-HZ5 well was drilled, on time and under budget, to a total measured depth of 11,914 feet TMD, or 7,274 feet TVD, and encountered multiple hydrocarbon-bearing intervals.

Arrow put IC-HZ5, a short horizontal well, on production on Aug. 3, 2026, in the Ubaque formation. The pay zone is a clean sandstone exhibiting an average porosity of 23 per cent with high resistivities. An ESP has been inserted in the well after perforating. The well is still cleaning up and is producing at a current rate of 1,270 bopd gross (635 bopd net).

The IC-HZ5 well also encountered approximately 20 feet of net oil pay (true vertical depth) in the C7 formation.

Flow test results

The ultimate flow rate will be determined in the first few weeks of production.

Initial production results are not necessarily indicative of long-term performance or ultimate recovery.

Forward drilling plans

Five additional cellars have been built at Icaco to continue the drilling program. IC-6 will be a vertical well with the Carbonera C7, Gacheta and Ubaque targets.

Production

Including production from the IC-3, IC-HZ4 and IC-HZ5 wells, total gross corporate production is over 5,000 barrels of oil equivalent per day. Currently, the CN-HZ12 well is off-line whilst the workover work to restore production is under way. The well was producing approximately 330 bopd gross (165 bopd net) when it was shut in. Arrow has continued to shut in the Pepper gas field due to low natural gas prices in Alberta, which was producing approximately 130 boe/d when it was shut in. The company believes that AECO gas prices will improve in the third and fourth quarters of 2026 once the region moves into the winter months. At that time the Pepper field is expected to be brought back on production.

Cash balance

As of Aug. 1, 2026, the company's estimated cash balance is $27.5-million (U.S.). The company continues to have no debt.

Tapir extension

Arrow and its partner in the Tapir block continue to be encouraged with the dialogue with the Colombian authorities regarding the extension of the Tapir block. Arrow believes that all conditions required for the extension to be granted have been met and management remains very confident that the extension will be granted. The company will continue to update the market on developments as they occur. Colombia elected a new president, Abelardo De La Espriella, in June. The transition to the new president will take place in August. Mr. De La Espriella has discussed Colombia needing more oil and gas development, and Arrow is looking forward to being a part of the president's vision.

Marshall Abbott, chief executive officer of Arrow, commented: "The success of the Icaco-3 well indicates that the Gacheta formation is able to produce commercial rates. The Icaco-4 and Icaco-5 horizontal wells had very short horizontal sections to prove the Ubaque's ability to produce from a horizontal well. Future projects at Icaco are expected to include both horizontal and vertical development wells targeting the Ubaque, Gacheta and C7. These results underline the significant hydrocarbon density that exists in the Llanos basin and more exclusively in the Tapir block.

"Strong netbacks and successful horizontal wells support payout occurring in months. This adds significant value and materially improves our positive balance sheet. We look forward to updating our shareholders on the progress at Icaco over the coming months."

About Arrow Exploration Corp.

Arrow Exploration (operating in Colombia through a branch of its 100-per-cent-owned subsidiary Carrao Energy SA) is a publicly traded company with a portfolio of premier Colombian oil assets that are underexploited and underexplored and offer high potential growth. The company's business plan is to expand oil production from some of Colombia's most active basins, including the Llanos, Middle Magdalena Valley (MMV) and Putumayo basins. The asset base is predominantly operated with high working interests, and the Brent-linked light oil pricing exposure combines with low royalties to yield attractive potential operating margins. By way of a private commercial contract with the recognized interest holder before Ecopetrol SA, Arrow is entitled to receive 50 per cent of the production from the Tapir block. The formal assignment to the company is subject to Ecopetrol's consent. Arrow's seasoned team is led by a hands-on executive team supported by an experienced board. Arrow is listed on the AIM (Alternative Investment Market) of the London Stock Exchange and on TSX Venture Exchange under the symbol AXL.

Qualified person statement

The technical information contained in this announcement has been reviewed and approved by Grant Carnie, senior non-executive director of Arrow Exploration. Mr. Carnie was formerly a member of the Canadian Society of Petroleum Geologists, holds a BSc in geology from the University of Alberta, and has over 35 years of experience in the oil and gas industry.

We seek Safe Harbor.