Comstock Resources Stock Jumps on $1.65B Asset Sale to SOCAR, New Drilling Venture

Comstock Resources (NYSE:CRK) shares rose 5% on Tuesday after the company announced two major strategic transactions: a $1.65 billion asset sale to the State Oil Company of the Azerbaijan Republic (SOCAR) and a separate $450 million drilling joint venture.

Details of the Transactions

Comstock has signed a letter of intent with SOCAR for the sale of minority interests in its Haynesville shale assets. According to the announcement, the deal includes:

• A 20% non-operated working interest in Comstock’s Legacy Haynesville upstream assets.
• A 15% interest in its Western Haynesville upstream assets, which will decrease to 7.5% after SOCAR achieves a 15% return on its investment.
• A 15% share of Comstock’s 73% ownership in Pinnacle Gas Services LLC.

The parties aim to sign a definitive agreement by October 31, 2026, with the transaction expected to close by the end of that year. Comstock will retain operational control of all the assets.

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Separately, Comstock entered into a Haynesville drilling venture with a partnership owned by the Jones family, the company's majority stockholder. The partnership will fund the drilling and completion costs for 27 wells over the next year, estimated at $450 million. After the partnership achieves a 15% return, 50% of its interest in the wells will revert to Comstock.

Strategic and Financial Impact

The primary use of the $1.65 billion in cash proceeds from the SOCAR sale will be to significantly deleverage Comstock's balance sheet. The company stated it intends to use the funds to reduce its total indebtedness, projecting a drop in net debt from $3.1 billion to $1.5 billion as of June 30, 2026.

For investors, this move signals a major step toward strengthening the company's financial position. The drilling venture, meanwhile, provides a capital-efficient path to develop its key Western Haynesville acreage, accelerating production without adding to Comstock's own capital expenditures.