Crescent Energy Company CRGY has announced the acquisition of Ridgemar Energy's Eagle Ford assets in Texas. The company stated that the cash-and-stock deal is valued at $905 million. Per the terms of the deal, Crescent Energy may have to pay an additional $170 million, subject to future oil prices. The deal is anticipated to be closed in the first quarter of 2025.

The acquisition should further expand CRGY’s footprint in the Eagle Ford basin, one of the most prolific basins in the United States. Crescent Energy has achieved operational synergies following the integration of SilverBow Resources into its portfolio. The company acquired SilverBow Resources for approximately $2.1 billion earlier this year. Following the success of its prior acquisition, the company is eager to add Ridgemar Energy’s assets to its portfolio to expand and strengthen its presence in the Eagle Ford Basin.

Ridgemar Energy, backed by private equity firm Carnelian Energy Capital, is one of the largest private oil-producing companies operating in the Eagle Ford. The company produces approximately 20,000 barrels of oil equivalent per day.

The U.S. energy sector has experienced an ongoing wave of consolidation, with companies utilizing their resources to expand their oil and gas reserves. This trend has resulted in deals worth more than $250 billion in 2023. This trend has also benefited private equity firms backing energy companies as they can profitably sell off their investments due to the increased demand from companies looking to boost their reserves and grow their inventory.

CRGY’s Zacks Rank and Key Picks

Currently, CRGY carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the energy sector are Smart Sand, Inc. SND, FuelCell Energy FCEL and Nine Energy Service NINE, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Smart Sand is a low-cost producer of high-quality Northern White frac sand, an ideal proppant for hydraulic fracturing and various industrial applications. The company provides proppant and other logistics services for several companies in the oil and gas industry. With sustained oil and gas market demand, SND is expected to see growing demand for its services, providing a positive outlook.

FuelCell Energy is a clean energy company offering low-carbon energy solutions. It produces power using flexible fuel sources such as biogas, natural gas and hydrogen. The company designs fuel cells that generate electricity through an electrochemical process that combines fuel with air, reducing carbon emissions and minimizing the environmental impact of power generation. As such, FCEL is anticipated to play a crucial role in the energy transition by enabling industries and communities to shift from traditional fossil fuels to low-carbon alternatives.

Nine Energy Service provides onshore completion and production services for unconventional oil and gas resource development. The company operates across key prolific basins in the United States, including the Permian, Eagle Ford, MidCon, Barnett, Bakken, Rockies, Marcellus and Utica, as well as throughout Canada. With a sustained demand for oil and gas in the future, the need for NINE’s services is anticipated to increase, which should position the company for growth in the long run.

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