EXCLUSIVE-Crescent Energy nears deal for US shale peer Vital Energy, sources say

By Shariq Khan and David French

NEW YORK, Aug 22 (Reuters) - Crescent Energy CRGY.N is in advanced talks to acquire smaller peer Vital Energy VTLE.N, people familiar with the matter said on Friday, in a deal that would give the energy producer an extensive position in the Permian Basin.

Terms of the combination could not be learned, but a transaction could be announced as soon as next week, said the sources, who cautioned a deal could still fall apart at the last minute and spoke on condition of anonymity to discuss private deliberations.

Crescent Energy has a market value of around $2.5 billion, while Vital Energy is worth around $600 million. Vital also carries around $2.3 billion of long-term debt.

Vital did not immediately respond to a request for comment. Crescent declined to comment.

Vital Energy's shares rose over 7% to $16.92 per share in extended trading after the Reuters report. Crescent Energy fell about 1% to $9.85 per share.

Crescent Energy is focused on exploration and production from older wells, which do not have the growth potential of traditional new shale wells but which provide consistent levels of oil and gas output and steady returns.

Its existing footprint primarily consists of the Eagle Ford basin in south Texas and the Uinta basin in Utah. In January, the company completed a near $1 billion acquisition of privately-held Ridgemar Energy's assets in the Eagle Ford.

Vital Energy has around 267,000 net acres in the Permian Basin, with net production of 137,900 barrels of oil equivalent per day, according to its website.

Mergers and acquisitions activity in the U.S. shale space tailed off in the second quarter of the year as volatility across energy and equity markets spooked sentiment. However, economies of scale still help to make the argument for consolidation.