HighPeak Energy and Pure Acquisition Corp. completed their business combination on Aug. 24, forming an  independent E&P company focused in the Permian Basin.

Pure, a blank check company formed in November 2017, had agreed to the business combination in May following a scuttled three-way merger agreement between the companies and private-equity-backed Grenadier Energy Partners II.

Previously, Pure and HighPeak, which share board members and are both led by industry veteran Jack D. Hightower, had agreed to acquire Grenadier, backed by EnCap Investments LP and Kayne Anderson Capital Advisors. However, the crash in oil prices earlier this year forced a renegotiation of terms and the transaction was terminated, according to a filing with the U.S. Securities and Exchange Commission.

The combined company, set to trade as HighPeak Energy Inc., will hold a 51,000-net-acre position in the northern Midland Basin primarily in Howard County, Texas. Current net production is about 2,600 boe/d from legacy horizontal wells that have recently been brought back online after voluntary production curtailments made in response to the global pandemic, according to a company release on Aug. 24.

In a statement, Michael L. Hollis, HighPeak Energy’s president, said: “With oil prices stabilizing at $40 or more per barrel for about the last two months and the closing of the business combination, we expect to begin increasing our production throughout the remainder of the year and to begin drilling with a one-rig program.”

HighPeak Energy expects to increase production to a range of 10,000 to 12,000 boe/d by first-quarter 2021.

“We are excited to have completed the business combination and begin building production and cash flow with our development program,” Hightower said in the Aug. 24 release. “Our initial focus will be bringing our 15 horizontal wells online this year and drilling an additional six wells by year-end.”

HighPeak Energy raised $102 million of equity through the money from Pure’s trust holders and a concurrent private placement. 

Consideration for business combination included approximately 75 million shares of HighPeak Energy’s common stock, par value $0.0001 per share. Additionally, as merger consideration, the public stockholders of Pure received shares and warrants of HighPeak stock plus contingent value rights.

The company’s common stock and warrants began trading on the Nasdaq Global Market on Aug. 24.