The pace of consolidation in U.S. oil and gas continues to accelerate — and this week, Denver-based Civitas Resources reportedly entered advanced talks to merge with SM Energy, a longtime Midland Basin operator. According to multiple reports, the companies are exploring a merger of equals that would create a combined entity valued around $14 billion, including debt.

Civitas Resources (NYSE: CIVI) gained 2.2% this week after Bloomberg reported the company is exploring a potential sale. The Denver-based independent oil & gas producer, with operations in both Texas and Colorado, is said to be working with advisers to evaluate deals with similarly sized or larger peers. While no final decision has been made, the news highlights growing consolidation momentum across the U.S. shale patch.

Civitas Permian Operating, LLC has cleared another milestone in its West Texas growth strategy. The company recently secured approval for a new air permit covering its NICE MARMOT facility in Reeves County, Texas (Project #398014). The permit, issued September 10, 2025, reflects Civitas’ continued investment in the Permian Basin and supports future oil and gas production from the lease.

Civitas Resources (NYSE:CIVI) continues to prove that disciplined execution and innovation can deliver results even in a volatile oil price environment. As one of the largest independent producers in the DJ and Permian basins, CIVI has sharpened its focus on cost efficiencies, optimized drilling, and AI-driven performance improvements.

Approximately 60% of total investments are planned to be allocated to the Permian basin, with the remainder to the DJ basin. Civitas expects to drill and complete 130 to 150 gross wells in the Permian basin and 90 to 110 gross wells in the DJ basin. The majority of activity in the DJ basin will be focused in the Watkins area, which is benefiting from higher well productivity.