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Comstock Secures $1.65 Billion Socar Partnership, $450M Haynesville Drilling Venture

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Comstock Resources (CRK) said on Tuesday that it had entered into a $1.65 billion strategic partnership with the State Oil Company of the Azerbaijan Republic and a separate $450 million Haynesville drilling venture with Jerry Jones.

Under the proposed Socar deal, the Azerbaijan state oil company would acquire working interests in Comstock's Legacy and Western Haynesville assets for $1.65 billion in cash.

Socar would receive a non-operated interest representing 20% of Comstock's Legacy Haynesville stake and 15% of its Western Haynesville stake, which would fall to 7.5% after five years, with a 15% return.

The agreement also covers 15% of Comstock's 73% stake in Pinnacle Gas Services, which provides midstream services in the Western Haynesville, with the transaction effective July 1, 2026.

Comstock and Socar aim to sign a definitive purchase agreement by Oct. 31, 2026, and close the transaction by year-end, subject to negotiations, customary conditions and required approvals.

The partnership would also give Socar matching participation rights in future Legacy and Western Haynesville opportunities, while Socar would provide Comstock with opportunities to market natural gas to international customers.

"This partnership introduces a reputable international strategic partner to help accelerate value creation for our investors, while allowing us to materially reduce debt and fully fund the planned development of our Western Haynesville acreage," said Jay Allison, Chairman and Chief Executive Officer of Comstock.

The Socar deal will reduce Comstock's net debt to $1.5 billion from $3.1 billion as of June 30, 2026, strengthening liquidity and supporting development in the Western Haynesville.

Under the drilling venture deal with Jerry Jones, a Jones family partnership will fund 85% of drilling and completion costs for 18 Western Haynesville wells and 80% for nine Legacy wells.

The venture will cover wells that Comstock plans to drill and complete over the next 12 months, with total spending expected to be about $450 million.

The drilling venture starts Sept. 1, 2026, and 50% of the well interests will revert to Comstock after the venture achieves a 15% return on investment.

The venture will support development across Comstock's 545,000 net acres in the Western Haynesville, provide gas volumes to Pinnacle Gas Services, and strengthen the company's balance sheet.

"We are also excited about the investment Jerry Jones is making in our Haynesville drilling program which will strengthen our balance sheet and allow us to continue to create value in our vast Western Haynesville assets," Allison said.

Price: $15.84, Change: $+1.41, Percent Change: +9.77%

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