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Aroway Energy Inc.

TICKER: ARW:TSX.V; ARWJF:OTCQX

Aroway Energy Inc. is a Canadian junior oil-focused production and exploration company participating in oil development and exploration prospects in Alberta and Saskatchewan, Canada. Through a joint venture partnership in the Peace River Arch of Northern, Alberta, Aroway and its partner have assembled a land package of 110 sections (70,400 acres) with 3-D seismic coverage over almost all of its lands. All targets are in close proximity to tie-in, gathering and infrastructure owned by Aroway's partner. Aroway also has 100%-operated working interest on a 3-D seismically defined exploration property in Central Alberta and a highly economic heavy oil producing property in Western Saskatchewan.


The information provided below is from analysts, newsletters and other contributors. Please contact the company and visit its website before making an investment decision.

Expert Comments:

The Energy Report Interview with Peter Epstein (8/14/14) "Aroway Energy Inc. has a heavy oil property in Saskatchewan, a light oil property in central Alberta and owns land in the Kerrobert area of west-central Saskatchewan. This story fascinates me because the company is 4–6 weeks away from drilling its Kerrobert area. Back in April, this stock was trading at CA$0.28, today it's at about CA$0.25. Yet the company is three months closer to potentially finding a blockbuster field. Located just 5–6 miles away, a private company called Caltex Resources is producing a reported cumulative 4,000 barrels/day from dozens of wells. If Aroway hits in late August, the stock could double or triple in subsequent months." More >

James West, Midas Letter (4/11/14) "Aroway Energy Inc. has all the ingredients for a dramatic rise in production and revenue. For risk-tolerant investors seeking exposure to conventional and enhanced oil and gas plays in the Western Canadian Sedimentary Basin, Aroway is attractively priced."

Devin Shire, Seeking Alpha (3/6/14) "One small company that I think today is worthy of further investigation is Canadian oil producer, Aroway Energy Inc. It ticks several boxes that I find appealing: high level of insider ownership, 22%, (interests are aligned with shareholders'); a very clean balance sheet (only $1.4M in debt); focused on very profitable oil and not natural gas (90% oil); involved in plays with well costs that are appropriate for a junior producer; the valuation is very compelling (trading at 2.2x cash flow) and a high-impact new asset that the market isn't aware of."

The Energy Report Interview with Bob Moriarty (10/1/13) Bob Moriarty: I follow the Canadian firm Aroway Energy Inc. very closely.

TER: Aroway Energy just increased its reserve estimate by 246%, but there was no correlated increase in its stock price.

BM: Exactly. The company is producing more and it has good management, yet the stock price has been cut in half. It has nothing to do with the merits of the company. It has everything to do with irrational behavior on the part of investors. I'm not concerned over the long term. More >

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Mike Perinotti, Seeking Alpha (6/17/13) "In October 2012, Aroway Energy Inc. announced a 526% production increase reaching 146,269 boe compared to 23,351 boe for the same period in 2012. The company also reported revenues of $12,018,074, which was a 1,112% increase from 2011. . .that's amazing production and progression for a company trading around $0.25. . .enough to have me watching this company very closely."

The Energy Report Interview with Bob Moriarty (4/30/13) Bob Moriarty: If you are in Canada, you are in great shape. Canada has a lot of oil. I like a company called Aroway Energy Inc. It is cheaper now than it has been in the last three years—$0.30/share. It is producing over 1,000 barrels of oil equivalent per day.

TER: It just came out with a new reserve estimate on West Hazel. Was it what you expected?

BM: It's a really good number. The problem is trying to figure out what it is worth. Aroway has made money. It is cash flow positive. It has good management that does what it says it will do. With the market and the juniors getting creamed so badly over the past two weeks, Aroway stock has lost about one-third of its value. I expect Aroway to be $0.60–1.00 in three to six months. The current price is simply irrational. Canada remains one of the best environments for investment. The Canadian banks are a lot saner than banks elsewhere. Taxation is not totally out of control. More >

James Brumley, SmallCap Network (3/13/13) "The folks running Aroway Energy Inc. have gotten very, very good at drilling for oil, because they know that each well counts. . .unlike many of its peers, the company is highly selective about the properties it buys and the wells it digs. . .Aroway first and foremost considers the return on its investment. . .the company sticks with the high-odds, low-cost wells, and the discipline is paying off in spades; it's barely two years old, is operationally profitable, and only pays production costs of about $10/barrel of oil at the four sites it's focusing on right now—that's an operating expense some other oil names can only dream about."

James Brumley, SmallCap Network (3/8/13) "Somehow, several major oil names have let key oil well prospects slip through their fingers in northern Alberta, yielding them to a junior explorer named Aroway Energy Inc. . .by carefully choosing which properties to buy and which to pass, Aroway has pieced together an oil well network that's producing 650 bpd, with more wells in development. . .the company owns land in all the right places in northern Alberta. Most of its sites are in the backyards of bigger oil names operating in Canada, like Canadian Natural Resources Ltd., Bonavista Energy Corp. and Birchcliff Energy Ltd.; an acquisition would be logistically simple for most of those companies."

The Energy Report Interview with James West (2/26/13) "I love Aroway Energy Inc. because it is developing oil and gas assets in Central Alberta as well as in Saskatchewan. It has a program in place whereby in mid-2013, it plans to be producing over 2,000 bpd, and 90% is oil. It is building its production infrastructure more or less internally from cash flow, and it is in a position where it is going to be growing that domestic production in a safe jurisdiction, Canada. I think Aroway is probably one of the best-case examples of lower-risk exposure, with an experienced management team that can access the capital and that has a record of successful drilling. It recently announced its year-end production. It exited 2012 with over 1 Mboe/d, of which 90% is oil. It also has another 100 boe/d behind pipe. That's up from the 2011 exit of around 650–700 boe/d. It is also getting ready to drill a lot of wells in Saskatchewan on its West Hazel property and is expecting to double its current production of about 300 bpd oil from there. It is well on track for reaching its target." More >

Bob Moriarty, 321 Energy (2/19/13) "Aroway Energy Inc.'s current cash flow is just under $1M/month; by the time it starts drilling, after breakup those numbers should grow to over $1.5M/month and the new drilling should add about $75,000/month per well. . .if the company folded its doors and sold every well it has today in the open market, it would be worth $48M or $0.78 a share. . .blue sky is worth something, especially when a company is increasing production at a 50–100% per year rate. I think the stock is capable of $1.50 without breaking a sweat—for damned sure $0.46 is cheap."

Jay Taylor, Hotline (2/8/13) "I was delighted to see little Aroway Energy Inc. pop up considerably this past week. It’s up more than 27% so far this year. The company continues to perform in accordance with guidance and it is my understanding that exploration is going well. It has raised a small amount of capital because management is wisely averse to borrowing money to carry out risky exploration wells. I expect this little company to continue growth with very modest shareholder dilution."

James West, Midas Letter (1/7/13) "Aroway Energy Ltd.'s two wells will target the Ellerslie formation. . .they are in a very prospective oil fairway with an offsetting pool having produced in excess of 1.39 MMbbl of light 38-degree API oil. . .the company's projections show Aroway Energy producing over 2 Kboe/d by the end of Q2/13, which, if successful, makes it rather undervalued at these levels relative to peers."

Jay Taylor, Gold, Energy & Tech Stocks (12/20/12) "If you are looking for a safe little oil and gas play in a safe jurisdiction with steady but considerable growth prospects, Aroway Energy Inc. looks like a very good bet."

Oil and Gas Investor (12/12/12) "Aroway Energy Inc. has commenced drilling on its 100% owned and operated Kirkpatrick Lake property in Central Alberta. The company will be drilling two Ellerslie oil prospects that have been selected from 3-D seismic data interpretation and are in a very prospective oil fairway with an offsetting pool that has produced in excess of 1.39 MMbbl of light 38 ° API oil. . .Aroway believes there may be three additional wells to be drilled upon the success of the initial test wells."

The Energy Report Interview with James West (11/15/12) "As that story starts to resolve itself, I think Aroway Energy Inc. will start to see more of a lift in its share price. These days, if you don't produce 1,000 bbl/d, you're not even on the radar. So the company is technically already over that hurdle because it will exit 2012 with 1,200 bbl/d." More >

Hotline (10/26/12) "Aroway Energy Inc. is growing rapidly, albeit from a small base; it is profitable, however, and growth is open ended from traditional oil and gas production in the politically safe province of Alberta, Canada. Infrastructure and access to existing pipelines in this northern Alberta location are key to getting bullish about this story. . .the good news here is that growth is from organic cash flows with minimal share dilution."

The Energy Report Interview with Bob Moriarty (9/18/12) "Aroway Energy Inc. has done very well, and done everything it said it would do in terms of adding resources, but the market clobbered it because it was skewed to natural gas. It's a good company, it's well run, it's increasing its production 50% per year. It went up to $0.90+ but then back down. I was buying Aroway at $0.30/share. I don't think you could go wrong where it is now, $0.55–0.60/share, either." More >

The Gold Report Interview with Arie Papernick (9/5/12) "One of the companies that we follow in the energy space is Aroway Energy Inc., located in Alberta's Peace River Arch. It's a well-managed, fast-growing company. It has a joint venture with a private company with significant infrastructure, which has lowered Aroway's operating costs. Aroway has expanded its land package significantly over the past year with positions near five majors. Current production is 650 boe/d, and 90% of that is oil. Management plans to double that production by the end of the year to 1,200 boe/d. They have a great track record and are exceeding their production targets; it's refreshing to see a team setting goals and meeting them." More >

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