HNR Acquisition completed its business combination with Pogo Resources and its subsidiaries.
Pogo is a New Mexico-based oil company. With offices in Dallas, TX and Hobbs, NM, Pogo’s management comprises industry experts with operational experience at both major oil and gas companies and smaller, entrepreneurial ventures. Pogo’s assets include interests in the Grayburg-Jackson oil field in the Permian Basin in Eddy County, New Mexico.
The Grayburg-Jackson oil field is on the Northwest Shelf of the Permian Basin. According to the United States Geological Survey, the Northwest Shelf contains the largest recoverable reserves among all the unconventional basins in the United States. Pogo’s holdings comprise 13,700 contiguous leasehold acres, 343 producing wells and 207 injection wells for a total of 550 wells.
Current production is approximately 1,400 barrels of oil and oil equivalent per day. Management expects to increase daily production to nearly 4,000 barrels of oil and oil equivalent in the next three years.
HNR in August cut the purchase price for Pogo to $63 million in cash plus 2 million shares of a new class of Class B stock, which have no economic rights (voting only) and 2 million units in a newly-formed subsidiary, HNRA Upstream, which are exchangeable for 2 million shares of the company’s newly-created Class A stock.
At deal announcement in January, original terms called for a purchase price of $100 million in cash (of which $15 million could be in a promissory note), plus $20 million in stock.
Following the shareholder vote, HBR entered into additional agreements with Meteora, including an agreement to reverse the redemption of up to the lesser of 600,000 shares, as well as an exchange agreement with certain holders of promissory notes at an interest rate of 15% per year.
The common stock of the merged company will trade on the NYSE American under the SPAC’s ticker symbol HNRA. Read more.
