SOCAR has agreed to pay $1.65 billion in cash for working interests in Comstock Resources, Inc.'s Haynesville gas assets, under a letter of intent the two companies signed and announced Sept. 1, 2026. The Azerbaijan state oil company, or a wholly owned subsidiary, would acquire non-operated stakes across Comstock's upstream and midstream Haynesville holdings, with the interest in the Western Haynesville shrinking once SOCAR hits a set return target.

The package SOCAR would acquire:

  • A 20% non-operated working interest in Comstock's Legacy Haynesville upstream assets
  • A 15% non-operated working interest in Comstock's Western Haynesville upstream assets, reducing to 7.5% after five years and once SOCAR reaches a 15% return on that investment
  • 15% of Comstock's 73% ownership stake in Pinnacle Gas Services LLC, the midstream unit that gathers and treats gas for the Western Haynesville

The letter of intent binds both sides to negotiate a definitive purchase and sale agreement, which they are targeting to sign by Oct. 31, 2026, with a closing by year end. Both dates depend on how the negotiations go, and closing still needs government and other third-party approvals. The transaction carries an effective date of July 1, 2026.

Beyond the asset sale, the two companies set up a strategic partnership. SOCAR gets the right to participate in future opportunities Comstock generates in the Legacy and Western Haynesville at the same percentages it is buying now, and SOCAR will offer Comstock access to international gas customers through its marketing operations.

Debt reduction

Comstock plans to put the sale proceeds toward paying down debt. On a pro forma basis, net debt falls from $3.1 billion to $1.5 billion as of June 30, 2026.

Comstock keeps operatorship

Comstock remains the operator of all the upstream assets in the deal and keeps managing and controlling Pinnacle Gas Services. A separate development and ownership agreement, part of the transaction, will govern future development and SOCAR's right to participate pro rata in future leasing and acquisitions within an agreed area of mutual interest.

The Western Haynesville acreage at the center of the deal covers 545,000 net acres. Comstock says the acreage is positioned to serve growing LNG, power generation and data center demand along the Gulf Coast, including the Texas Power Generation Hub in Anderson County, Texas.

$450 million drilling venture with Jerry Jones

Separately, Comstock entered a Haynesville shale drilling venture with Jerry Jones, the company's majority stockholder. Starting Sept. 1, 2026, a partnership owned by the Jones family will fund 85% of the drilling and completion costs for 18 Western Haynesville wells and 80% of the costs for nine Legacy Haynesville wells, which Comstock will drill and complete over the next twelve months at an expected cost of about $450 million. Once the Jones partnership reaches a 15% return on that investment, half the interest in the wells reverts to Comstock.

M. Jay Allison, Comstock's chairman and chief executive, called SOCAR a "reputable international strategic partner" that will help the company cut debt and fund development of the Western Haynesville while Comstock keeps control of the assets. Rovshan Najaf, SOCAR's president, said the deal creates a "strong foundation" for expanding the two companies' cooperation.

Wells Fargo advised Comstock on the deal and O'Melveny & Myers LLP served as its legal counsel. J.P. Morgan Securities LLC advised SOCAR, with Baker Botts LLP as its legal counsel.