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UPDATE 1-Desert Peak Minerals, Falcon Minerals to combine in $1.9 bln deal

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(Adds details from release, background)

Jan 12 (Reuters) - Desert Peak Minerals, an owner of mineral rights and royalties, said on Wednesday it would merge with rival Falcon Minerals to go public in a deal valuing the combined company at $1.9 billion.

The merger comes at a time when oil prices have climbed to multi-year highs, spurred by a rebound in fuel demand and supply disruptions. Brent crude was trading at around $84 a barrel on Wednesday.

Desert Peak, set up by energy-focused hedge fund Kimmeridge Energy Partners, buys and manages oil and gas minerals and royalty interests in the Permian basin of Texas and New Mexico.

Holders of mineral rights, like Desert Peak and Falcon, generally lease the properties to oil and gas producers for drilling and daily activities, in turn receiving a share of the income, or royalty, generated from the sale of the resources.

Desert Peak and Falcon will together own more than 139,000 net royalty acres in the Permian basin with expected production of around 13,500 to 14,500 barrels of oil equivalent per day in the first half of this year.

Desert Peak, which had filed for an initial public offering last year but reportedly postponed the plan in November, will own 73% of the combined company and Falcon will own the rest.

The deal is expected to add to Falcon's cash flow on a per share basis in 2022.

(Reporting by Rithika Krishna in Bengaluru; Editing by Aditya Soni)