Exhibit 99.1

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENT

The unaudited pro forma condensed combined financial information and related footnotes (the “Pro Forma Financial Statement”) have been prepared in accordance with Article 11 of Regulation S-X, Pro Forma Financial Information, which is herein referred to as Article 11. The Pro Forma Financial Statement of Civitas Resources, Inc. and its subsidiaries (“Civitas”) presents the combination of the financial information and the pro forma effects with respect to the following transactions (as used herein, collectively, the “Transactions”), further details of which are included within the footnotes to the Pro Forma Financial Statements:

The Pro Forma Financial Statement has been prepared from the respective historical consolidated financial statements of Civitas for the year ended December 31, 2021, HighPoint for the period from January 1, 2021, through March 31, 2021 (during which time it was a debtor-in-possession), Extraction for the period from January 1, 2021, to October 31, 2021, and Crestone Peak for the period from January 1, 2021, to October 31, 2021, adjusted to give effect to the Transactions. The unaudited pro forma condensed combined balance sheet and supplemental pro forma disclosures about oil and gas producing activities as of December 31, 2021, are not presented, as the Transactions had been completed as of that date. Accordingly, the Transactions are reflected in the Civitas balance sheet and the supplemental disclosures about oil and gas producing activities as of December 31, 2021, as reflected in the Civitas Annual Report on Form 10-K for the year ended December 31, 2021.

The unaudited pro forma condensed combined statement of operations (the “Pro Forma Statement of Operations”) for the year ended December 31, 2021, gives effect to the Transactions as if they had been consummated on January 1, 2021. The Pro Forma Statement of Operations contains certain reclassification adjustments to conform the historical HighPoint, Extraction, and Crestone Peak financial statement presentation to Civitas’ financial statement presentation.

The Pro Forma Financial Statement is presented to reflect the Transactions and does not represent what Civitas’ results of operations would have been had the Transactions occurred on the date noted above, nor do they project the results of operations of the combined company following the effective dates. The Pro Forma Financial Statement is intended to provide information about the continuing impact of the Transactions as if they had been consummated earlier. The transaction accounting adjustments are based on information and certain estimates and assumptions that management believes are reasonable based on currently available information. In the opinion of management, all adjustments necessary to present fairly the Pro Forma Financial Statement have been made.

The Pro Forma Financial Statement does not include the realization of any cost savings from operating efficiencies, synergies or future restructuring activities which might result from the Transactions and also does not include management’s estimates of certain cost savings to be realized as a result of the Transactions. Further, there may be additional charges related to other integration activities resulting from the Transactions, the timing, nature and amount of which management cannot currently identify, and thus, such charges are not reflected in the Pro Forma Financial Statement.

As of the date of this Current Report on Form 8-K, while the fair value estimates for the merger consideration in the Extraction Merger and the Crestone Peak Merger are final, such allocation to the assets acquired and liabilities assumed is preliminary. Civitas is continuing to assess the fair values of certain of the Extraction and Crestone Peak assets acquired and liabilities assumed. In particular, assets and liabilities subject to potential adjustment, in amounts that could be material to the Pro Forma Financial Statement, include, but are not limited to, proved properties, unproved properties, and accounts payable and accrued expenses related to Civitas’ continued assessment over the application of lease contracts and related deductions. Civitas cannot reasonably estimate the impact of such conclusions as there is still a high level of uncertainty regarding the underlying terms and application.

As a result of the foregoing, the transaction accounting adjustments for Extraction and Crestone Peak are preliminary and subject to change as additional information becomes available and additional analysis is performed. The preliminary pro forma adjustments have been made solely for the purpose of providing the Pro Forma Financial Statement presented herein. The assumptions and estimates used to determine the preliminary purchase price allocations and fair value adjustments are described in the notes accompanying the Pro Forma Financial Statement. Any increases or decreases in the fair values of assets acquired and liabilities assumed upon completion of the final valuations will result in adjustments to the Pro Forma Statement of Operations. The final purchase price allocations may be materially different than those reflected in the preliminary purchase price allocations presented herein.

As of the date of this Current Report on Form 8-K, the fair value estimates of the HighPoint assets acquired and liabilities assumed are final as Civitas has completed its detailed valuation analysis.

The Pro Forma Financial Statement should be read in conjunction with:

CIVITAS RESOURCES, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

Year Ended December 31, 2021 

See accompanying “Notes to Unaudited Pro Forma Condensed Combined Financial Statements”

CIVITAS RESOURCES, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
(CONTINUED)

Year Ended December 31, 2021

See accompanying “Notes to Unaudited Pro Forma Condensed Combined Financial Statements”

CIVITAS RESOURCES, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
(CONTINUED) 

Year Ended December 30, 2021

See accompanying “Notes to Unaudited Pro Forma Condensed Combined Financial Statements”

NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENT

NOTE 1 — BASIS OF PRESENTATION

The Civitas, HighPoint, Extraction and Crestone Peak historical financial information has been derived from each respective company’s historical financial statements which are incorporated by reference or included as an exhibit to this Current Report on Form 8-K. Certain of HighPoint’s, Extraction’s and Crestone Peak’s historical amounts have been reclassified to conform to Civitas’ financial statement presentation, as discussed further in Note 3. The Pro Forma Financial Statement should be read in conjunction with each company’s historical financial statements and the notes thereto. The Pro Forma Statement of Operations gives effect to the Transactions as if they had been completed on January 1, 2021.

Each of the HighPoint Merger, the Extraction Merger and the Crestone Peak Merger are described in the accompanying notes to the Pro Forma Financial Statement. In the opinion of Civitas’ management, all material adjustments have been made that are necessary to present fairly the Pro Forma Financial Statement in accordance with Article 11. The Pro Forma Financial Statement does not purport to be indicative of the results of operations of the combined company that would have occurred if the Transactions had occurred on the date indicated, nor are they indicative of Civitas’ future results of operations. In addition, future results may differ significantly from those reflected in the Pro Forma Financial Statement.

NOTE 2 — EXTRACTION AS ADJUSTED

On January 20, 2021, Extraction emerged from Chapter 11 bankruptcy and qualified for fresh start reporting under Accounting Standards Codification 852, Reorganizations (“ASC 852”). As such, a new reporting entity was considered to have been created such that the Extraction results of operations between January 21, 2021 and October 31, 2021 (the “Extraction Successor Period”) are not comparable with the Extraction results of operations between January 1, 2021 and January 20, 2021 (the “Extraction Predecessor Period”). In  order to determine the Extraction As Adjusted amounts, the results of operations for the Extraction Successor from January 21, 2021, through September 30, 2021, have been added to the results of operations for the Extraction Predecessor from January 1, 2021 through January 20, 2021. Further, in order to determine the Extraction As Further Adjusted amounts, the Extraction As Adjusted amounts have been added to the results of operations for the Extraction Successor from October 1, 2021 through October 31, 2021, as reflected in the Pro Forma Statement of Operations for the year ended December 31, 2021.

NOTE 3 — CRESTONE PEAK AS ADJUSTED HISTORICAL FINANCIAL STATEMENT INFORMATION

The historical financial statements of Crestone Peak included as an exhibit to this Current Report on Form 8-K include the historical statement of operations of Crestone Peak for the nine months ended September 30, 2021. Given the Crestone Peak Merger was not completed until November 1, 2021, for pro forma purposes herein in order to determine the Crestone Peak As Adjusted amounts, Crestone Peak’s results of operations for the nine months ended September 30, 2021, have been added to Crestone Peak’s results of operations for the period from October 1, 2021, through October 31, 2021, as reflected in the Pro Forma Statement of Operations for the year ended December 31, 2021.

NOTE 4 — RECLASSIFICATION ADJUSTMENTS

The Pro Forma Financial Statement has been adjusted to reflect reclassifications of HighPoint’s, Extraction’s, and Crestone Peak’s historical financial statements to conform to Civitas’s financial statement presentation.

NOTE 5 — HIGHPOINT ACQUISITION ACCOUNTING AND PRO FORMA ADJUSTMENTS

As previously discussed, on April 1, 2021, Civitas completed its acquisition of HighPoint, pursuant to the terms of HighPoint’s Prepackaged Plan. The Prepackaged Plan implemented the HighPoint Merger and related restructuring transactions in accordance with the HighPoint Merger agreement.

Pursuant to the Prepackaged Plan and the HighPoint Merger agreement, on the HighPoint Effective Date, HighPoint Merger Sub merged with and into HighPoint, with HighPoint continuing as the surviving corporation as a wholly owned subsidiary of Civitas. On the HighPoint Effective Date, each eligible share of HighPoint common stock, par value $0.001 per share (“HighPoint Common Stock”) issued and outstanding immediately prior to the HighPoint Effective Date was automatically converted into the right to receive 0.11464 shares of Civitas common stock, par value $0.01 per share (“Civitas Common Stock”), with cash paid in lieu of fractional shares, resulting in the issuance of 487,952 shares of Civitas Common Stock to former HighPoint stockholders.

Concurrently with the HighPoint Merger and pursuant to the Prepackaged Plan, in exchange for the $625.0 million in aggregate principal amount outstanding of 7.0% Senior Notes due 2022 of HighPoint Operating Corporation (“HighPoint OpCo”) and 8.75% Senior Notes due 2025 of HighPoint OpCo (collectively, the “HighPoint Senior Notes”), Civitas issued to all holders of HighPoint Senior Notes an aggregate of (i) 9,314,214 shares of Civitas Common Stock and (ii) $100.0 million aggregate principal amount of 7.5% Senior Notes due 2026 of Civitas (“Civitas Senior Notes”).

HighPoint Acquisition Accounting

Civitas was the accounting acquirer to the HighPoint Merger which has been accounted for under the acquisition method of accounting for business combinations in accordance with ASC 805, Business Combinations (“ASC 805”). The allocation of the purchase price with respect to the HighPoint Merger was previously finalized within the measurement period based on the closing date of the acquisition of April 1, 2021.

The following tables present the merger consideration and purchase price allocation of the assets acquired and the liabilities assumed in the HighPoint Merger:

⁽¹⁾ Based on the number of shares of HighPoint common stock issued and outstanding as of April 1, 2021 as converted at the exchange ratio of 0.11464.

⁽²⁾ Based on the closing stock price of Civitas Common Stock on April 1, 2021.

HighPoint Pro Forma Adjustments

The Pro Forma Financial Statement has been adjusted to give effect to the HighPoint Merger as follows:

NOTE 6 — EXTRACTION PRELIMINARY ACQUISITION ACCOUNTING AND PRO FORMA ADJUSTMENTS

Pursuant to the Extraction Merger Agreement, on the Extraction Effective Date, (i) Merger Sub merged with and into Extraction, with Extraction continuing its existence as the surviving corporation as a wholly owned subsidiary of Civitas following the Extraction Merger, (ii) each share of common stock, par value $0.01 per share, of Extraction (the “Extraction Common Stock”) issued and outstanding as of immediately prior to the Extraction Effective Date was converted into the right to receive 1.1711 shares of Civitas Common Stock for each share of Extraction Common Stock (the “Extraction Exchange Ratio”), with cash paid in lieu of the issuance of fractional shares, if any, and (iii) each holder of Extraction Common Stock received a total dividend equalization payment, as part of the Extraction Merger purchase consideration, of approximately 0.017225678 shares of Civitas Common Stock per share of Extraction Common Stock related to dividends paid to Civitas’ stockholders on June 30, 2021 and September 30, 2021, with cash paid in lieu of the issuance of fractional shares, if any.

Additionally, pursuant to the Extraction Merger Agreement, on the Extraction Effective Date, each award of restricted stock units (including those subject to performance-based vesting conditions) issued pursuant to Extraction’s 2021 Long Term Incentive Plan (the “Extraction Equity Plan”) that was outstanding immediately prior to the Extraction Effective Date and that by its terms did not settle by reason of the occurrence of the closing of the Extraction Merger (each, an “Extraction RSU Award”) was assumed by Civitas and converted into a number of restricted stock units with respect to shares (rounded to the nearest number of whole shares) of Civitas Common Stock (such restricted stock unit, a “Converted RSU”) equal to the product of the number of Extraction Common Stock subject to the Extraction RSU Award immediately prior to the Extraction Effective Date multiplied by the Extraction Exchange Ratio, effective as of the Extraction Effective Date.

As of the Extraction Effective Date, each Converted RSU continued to be governed by the same terms and conditions (including vesting and forfeiture) that were applicable to the corresponding Extraction RSU Award immediately prior to the Extraction Effective Date. However, any Extraction RSU Award subject to performance-based vesting conditions continued to be measured pursuant to the same terms and conditions of the underlying Extraction RSU Award in effect as of immediately prior to the Extraction Effective Date.

Further, effective as of immediately prior to the Extraction Effective Date, each award of deferred stock units granted under the Extraction Equity Plan and held by a member of the Extraction board who was not a designee of Extraction for appointment to Civitas’ Board as of the Extraction Effective Date immediately vested in full. As such, any Civitas Common Stock issued in exchange for the corresponding Extraction Common Stock issued and outstanding related to these deferred stock unit grants were included in the Extraction Merger purchase consideration.

Additionally, on the Extraction Effective Date, in accordance with the terms of (i) the Extraction Tranche A warrants to purchase Extraction Common Stock, issued pursuant to that certain Warrant Agreement by and between Extraction and American Stock Transfer & Trust Company, LLC, as warrant agent (“AST”), dated as of January 20, 2021 (the “Tranche A Warrants”), and (ii) the Extraction Tranche B warrants to purchase Extraction Common Stock, issued pursuant to that certain Warrant Agreement by and between Extraction and AST, as warrant agent, dated as of January 20, 2021 (the “Tranche B Warrants,” and, together with the Tranche A Warrants, the “Extraction Warrants”), that were issued and outstanding immediately prior to the Extraction Effective Date, were cancelled and Civitas executed a replacement warrant agreement for the Tranche A Warrants and a replacement warrant agreement for the Tranche B Warrants and issued to each holder of the Extraction Warrants a replacement warrant (each, a “Replacement Warrant”) that is exercisable for a number of shares of Civitas Common Stock equal to the number of shares of Civitas Common Stock that would have been issued or paid to a holder of the number of shares of Extraction Common Stock into which such Extraction Warrant was exercisable immediately prior to the Extraction Effective Date. Each Replacement Warrant has an exercise price as set forth in the applicable Replacement Warrant Agreement, subject to adjustment as set forth therein. As part of the Extraction Merger purchase consideration, 3.4 million Tranche A and 1.7 million Tranche B Replacement Warrants were issued.

As previously discussed in Note 2 to the Pro Forma Financial Statement, Extraction previously emerged from Chapter 11 bankruptcy on January 20, 2021. As such, for purposes of the Pro Forma Financial Statement, “Extraction Successor” refers to Extraction from January 21, 2021 through October 31, 2021, and “Extraction Predecessor” refers to Extraction from January 1 to January 20, 2021.

Extraction Preliminary Acquisition Accounting

Civitas has determined it is the accounting acquirer to the Extraction Merger which will be accounted for under the acquisition method of accounting for business combinations in accordance with ASC 805. The allocation of the purchase price with respect to the Extraction Merger is based upon management’s estimates of and assumptions related to the fair values of assets acquired and liabilities assumed as of November 1, 2021, using currently available information. The final purchase price allocation and the resulting effect on Civitas’ results of operations may differ significantly from the pro forma amounts included herein, which are based on preliminary estimates and assumptions. Civitas expects to finalize the purchase price allocation as soon as practicable subsequent to the Extraction Effective Date, which will not extend beyond the one-year measurement period provided under ASC 805.

The following tables present the merger consideration and preliminary purchase price allocation of the assets acquired and the liabilities assumed in the Extraction Merger:

⁽¹⁾ Based on the number of shares of Extraction Common Stock issued and outstanding as of November 1, 2021 and the conversion ratio of 1.1711 per share of Civitas Common Stock.

⁽²⁾ Based on the closing stock price of Civitas Common Stock on November 1, 2021.

Extraction Pro Forma Adjustments

The Pro Forma Financial Statement has been adjusted to give effect to the Extraction Merger as follows:

NOTE 7 — CRESTONE PEAK PRELIMINARY ACQUISITION ACCOUNTING AND PRO FORMA ADJUSTMENTS

Pursuant to the Crestone Peak Merger Agreement, at the Crestone Peak Effective Date, (i) Merger Sub 1 merged with and into Crestone Peak (the “Merger Sub 1 Merger”), with Crestone Peak continuing its existence as the surviving corporation as a wholly owned subsidiary of Civitas following the Merger Sub 1 Merger (the “Crestone Surviving Corporation”), and (ii) subsequently, the Crestone Surviving Corporation merged with and into Merger Sub 2 (the “Merger Sub 2 Merger”) and together with the Merger Sub 1 Merger, the (“Crestone Peak Merger”), with Merger Sub 2 continuing its existence as the surviving entity as a wholly owned subsidiary of Civitas (the “Crestone Surviving Entity”).

Pursuant to the Crestone Peak Merger Agreement, at the effective time of the Merger Sub 1 Merger (the “Merger Sub 1 Effective Date”), the shares of Crestone Peak common stock, par value $0.01 per share (“Crestone Peak Common Stock”) (excluding shares of Crestone Peak Common Stock held by Crestone Peak as treasury shares or by Civitas or Merger Sub 1 immediately prior to the Merger Sub 1 Effective Date), issued and outstanding as of immediately prior to the Merger Sub 1 Effective Date were converted into the right to collectively receive 22.5 million shares of Civitas Common Stock (the “Crestone Peak merger consideration”). In addition, at the effective time of the Merger Sub 2 Merger (the “Merger Sub 2 Effective Date”), each share of common stock of the Crestone Surviving Corporation issued and outstanding as of immediately prior to the Merger Sub 2 Effective Date was automatically cancelled and each unit of Merger Sub 2 issued and outstanding immediately prior to the Merger Sub 2 Effective Date remained issued and outstanding and represents the only outstanding units of the Crestone Surviving Entity immediately following the Merger Sub 2 Merger.

Crestone Peak Preliminary Acquisition Accounting

Civitas has determined it is the accounting acquirer to the Crestone Peak Merger which will be accounted for under the acquisition method of accounting for business combinations in accordance with ASC 805. The allocation of the purchase price with respect to the Crestone Peak Merger is based upon management’s estimates of and assumptions related to the fair values of assets to be acquired and liabilities to be assumed as of November 1, 2021, using currently available information. The final purchase price allocation and the resulting effect on Civitas’ results of operations may differ significantly from the pro forma amounts included herein. Civitas expects to finalize the purchase price allocation as soon as practicable subsequent to the Crestone Peak Merger which will not extend beyond the one-year measurement period provided under ASC 805.

The following tables present the merger consideration and preliminary purchase price allocation of the assets acquired and the liabilities assumed in the Crestone Peak Merger:

Crestone Peak Pro Forma Adjustments

The Pro Forma Financial Statement has been adjusted to give effect to the Crestone Peak Merger as follows: