HighPeak Energy, Inc.

What they do

HighPeak explores for, develops and produces crude oil, NGL and natural gas primarily in Howard and Borden Counties, Texas, with smaller positions in Scurry and Mitchell Counties. As of December 31, 2025, it held two generally contiguous leasehold positions of approximately 154,472 gross (142,560 net) acres, about 72% held by production, at an average working interest of approximately 92%. The company operates approximately 98% of its net acreage and focuses horizontal development on the Wolfcamp A, Lower Spraberry and Middle Spraberry formations. It employed fifty full-time employees as of December 31, 2025.

Revenue drivers

• Crude oil sales — The primary revenue source; second quarter 2026 crude oil sales were $260.4 million and sales volumes were approximately 64% crude oil.
• Natural gas liquids (NGL) — NGL contributed to a production mix that was approximately 83% liquids in the second quarter of 2026, with an average realized price of $24.14 per Bbl.
• Natural gas — Natural gas is produced alongside oil; second quarter 2026 average realized natural gas prices were negative $1.50 per Mcf before derivatives and negative $0.61 per Mcf including derivatives.

Recent performance

Second quarter 2026 sales volumes averaged 45.3 MBoe/d, approximately 64% crude oil and 83% liquids. Net income was $82.3 million, or $0.59 per diluted share, and EBITDAX was $147.6 million, or $1.06 per diluted share. Average realized prices were $98.82 per Bbl of crude oil, $24.14 per Bbl of NGL and negative $1.50 per Mcf of natural gas, for an overall realized price of $66.11 per Boe before derivatives. Total capital expenditures excluding acquisitions were $107.5 million for the quarter, and cash costs were $17.02 per Boe.

Strategy

Management reported first-half 2026 production 7% above the midpoint of guidance and operating expenses 13% below the midpoint of guidance, which it attributed to operational efficiency, cost control and base production optimization. The company ran one drilling rig and one frac crew in the second quarter, drilled 8 gross (7.7 net) horizontal wells, completed 16 gross (16.0 net) wells and turned 8 gross (8.0 net) wells in line. It uses multi-well pad development to reduce cycle times and capture infrastructure and facility economies of scale. Management states it remains committed to disciplined capital allocation and further balance sheet improvement.

Risks

• Commodity price volatility — Crude oil, NGL and natural gas prices are volatile, and sustained declines could impair HighPeak's financial condition and its ability to meet capital expenditure obligations.
• Reserve estimate uncertainty — Reserve estimates rely on assumptions that may prove inaccurate, and material inaccuracies would affect the quantities and present value of reserves.
• Capital and financing needs — Development projects and acquisitions require substantial capital expenditures, and HighPeak may be unable to obtain capital or financing on satisfactory terms.
• Debt agreement restrictions — Restrictions in the Term Loan Credit Agreement and Senior Credit Facility Agreement, and any future debt agreements, could limit growth.

Outlook

Management said it remains committed to disciplined capital allocation and creating durable long-term value as it executes its plan through the remainder of the year. It cited higher production, lower costs and favorable commodity pricing as translating into stronger free cash flow generation and further balance sheet improvement. As of June 30, 2026, the company had 21 gross (20.4 net) horizontal wells in progress, including 16 gross (15.6 net) wells in various stages of completion.