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Crescent Energy Said to be in Advance Talks to Acquire Pure Play Permian, Vital Energy

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   |    Friday,August 22,2025

Crescent Energy (CRGY) is rumored to be circling Vital Energy (VTLE). If talks advance, the pitch practically writes itself: buy a Permian-pure operator that just tightened its cost structure, sits on ~11+ years of inventory, and is guiding to meaningful 2H-25 free cash flow while paying down debt. Vital’s recent deck shows a leaner machine—lower LOE/G&A, long-lateral designs (Horseshoe, J-Hook) that cut breakevens, and ~95% of 2H-25 oil hedged around ~$69 WTI. That’s the kind of steadier cash profile a consolidator likes when stitching assets across Midland and Delaware.

Assets & inventory

  • Total net acres: ~267,300 Permian (companywide summary).

  • By basin (Asset Overview):
    – Delaware: ~81,200 net acres; ~305 gross locations; avg lateral ~11,600’; completable ft ~3.55MM; breakeven ~$55 WTI; ~65% of FY-25 capital.
    – Midland: ~186,100 net acres; ~615 gross locations; avg lateral ~13,400’; completable ft ~8.23MM; breakeven ~$52 WTI; ~35% of FY-25 capital.

  • Inventory depth: ~920 locations (>11 years at current pace), with substantial growth in sub-$50 breakeven footage vs. 2023. 

  • Designs that extend inventory: Horseshoe (Midland) & J-Hook (Delaware) enabling longer laterals and lower breakevens; illustrative comparisons provided.

 

Vital Energy: latest snapshot (2Q25 & 2025 outlook)

  • 2Q25 production: 137.9 MBOE/d; oil: 62.1 MBO/d. Capex: $257MM. Adj. FCF: $36MM. Consolidated EBITDAX: $338MM. (slide “2Q-25 Highlights,” 

  • FY-25 reaffirmed: oil 63.3–65.3 MBO/d; total 136.5–139.5 MBOE/d; capex $850–$900MM; Adj. FCF ≈ $305MM at strip used.

  • Costs trending down: LOE/G&A outlook improved vs. prior run-rate after contract resets, route consolidation, and power/fuel changes.

  • Hedges: ~95% of expected 2H-25 oil hedged ~ $69 WTI; detailed volumes through FY-27 in table.

  • Balance sheet: targeting ~$310MM net-debt reduction in 2025; no term maturities until 2029. (p.9)

Detailed reserves (from YE-2024 10-K figures

  • Total proved reserves: ~455 MMBOE at YE-24 (up ~12% YoY). PD ~70% / PUD ~30%.
    – Commodity mix (PD): oil 37%, NGL 32%, gas 31%.
    – Commodity mix (PUD): oil 47%, NGL 28%, gas 25%.

  • PV-10 (non-GAAP): $4.51B at SEC price deck (oil $75.48/bbl; gas $2.13/mcf); sensitivity table at $60/$70/$80 oil shown. 

  • Base PDP decline expectations: oil ~42% in FY-25 trending to ~14% by FY-29; total MBOE/d declines similarly.

Why this could fit CRGY’s playbook (story angle)

A buyer gets: (1) basin-balanced Permian scale across Midland/Delaware with ~267k net acres and ~920 gross locations; (2) $4.5B PV-10 proved base (YE-24) leaning 70% PD; (3) 2025 free-cash generation supported by hedges, improving capital efficiency, and a visible TIL cadence; and (4) a management team methodically cutting unit costs. 

Fold that into a broader platform, and the combined machine could high-grade capital toward the lowest breakeven packages (Horseshoe/J-Hook), accelerate deleveraging, and harvest synergy in marketing, midstream, and overhead. That’s the thesis—now it comes down to price, structure, and who captures the inventory uplift.

 




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