Comstock plans to cut debt with $1.65 billion Haynesville stake sale to Azerbaijan's SOCAR

Under the deal, SOCAR will gain a 20% interest in Comstock's Legacy Haynesville assets and a 15% stake in subsidiary Pinnacle Gas Services. Azerbaijan's state-owned oil and gas company will also get a 15% interest in Comstock's Western Haynesville assets, which will shrink to 7.5% after five years and once SOCAR earns a 15% return on its investment.

The companies aim to have a definitive agreement by October 31.

Comstock said the partnership will give SOCAR the opportunity to participate in future Legacy and Western Haynesville projects at the same percentages as its acquired interests, while SOCAR will provide Comstock avenues to market its natural gas to international customers.

The U.S. gas producer will retain operatorship of the upstream assets and continue to manage and control Pinnacle Gas Services.

Separately, Comstock said it has entered into a drilling venture with its majority shareholder Jerry Jones. Under the deal, a partnership owned by the Jones family will fund 80% to 85% of drilling and completion costs for 27 Haynesville wells over the next 12 months.

The venture is expected to cost about $450 million, Comstock said.