(Reuters) - WPX Energy Inc WPX.N said on Monday it would buy privately held Felix Energy in a $2.5 billion deal, as the Permian basin operator looks to add oil-rich acreage in the Delaware region of the prolific shale field, sending its shares up more than 9%.

FILE PHOTO: A WPX Energy natural gas drilling rig in Parachute, Colorado, December 10, 2014. REUTERS/Jim Urquhart/File Photo

The Permian basin of Texas and New Mexico is at the heart of the shale boom that has helped the United States become the world’s biggest crude oil producer.

The deal gives WPX access to Felix’s about 1,500 gross undeveloped locations in the eastern part of the Delaware basin, with projected production of about 60,000 barrels of oil equivalent per day (boe/d).

“The transaction we’ve announced this morning checks all the boxes for us,” WPX Chief Executive Officer Richard Muncrief said on a conference call.

The company said it expects to spend in the range of $1.68 billion to $1.80 billion as pro forma development capital for 2020, once the deal closes.

Overall, the deal “looks favorable for WPX at first blush”, Piper Jaffray analysts said, as the company is increasing Delaware scale at an attractive valuation and gradually pivoting away from the Williston basin, which was poised to exhaust inventory in the coming years at the current pace of activity.

The deal is expected to close early in the second quarter of 2020 and consists of $900 million in cash and $1.6 billion in WPX stock.

WPX said it would add two members to its board from EnCap Investments LP, the private equity company that founded Felix.

The company said it has obtained committed financing from Barclays for the deal and has access to a $1.5 billion revolving credit facility.

This acquisition of a large private equity funded E&P by a public company is reminiscent of the Permian land rush in 2016-2017, when public companies were rapidly building up inventory, said Enverus analyst Andrew Dittmar.

WPX also expects pro forma production of more than 240,000 boe/d at about 64% oil, after the deal closes.

Barclays and Tudor, Pickering, Holt & Co are financial advisers to WPX and Weil, Gotshal & Manges LLP the legal adviser, while Jefferies LLC is the financial adviser to Felix and Vinson & Elkins LLP the legal adviser.