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Deals - Acquisition, Mergers, Divestitures | Top Story

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

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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