Houston: SOCAR and US-based Comstock Resources, Inc. have signed a Letter of Intent aimed at establishing a strategic partnership, SOCAR said, APA-Economics reports.
According to Azeri-Press News Agency, under the document, SOCAR will acquire a 20% working interest in Comstock’s Legacy Haynesville upstream assets, a 15% working interest in its Western Haynesville upstream assets, as well as 15% of Comstock’s 73% ownership interest in Pinnacle Gas Services LLC. SOCAR’s 15% working interest in the Western Haynesville assets is expected to be reduced to 7.5%, subject to the relevant terms, once a 15% return on investment in those assets is achieved.
The total value of the transaction, subject to customary purchase price adjustments, is $1.65 billion. SOCAR is planning appropriate measures to finance the transaction. The parties are targeting the agreement and signing of a definitive purchase and sale agreement no later than October 31, 2026, as well as completion of the transaction by December 31, 2026, following the fulfillment of the relevant conditions, including obtaining necessary government and third-party approvals.
As part of the strategic partnership, SOCAR is expected to participate, in proportion to its respective working interests, in future new opportunities developed by Comstock in Legacy Haynesville and Western Haynesville. In addition, the parties will cooperate to expand opportunities for Comstock’s natural gas to access international markets.
SOCAR President Rovshan Najaf expressed optimism about the partnership, highlighting the combined experience and capabilities of SOCAR and Comstock as a solid foundation for expanding strategic cooperation. M. Jay Allison, Chairman and CEO of Comstock, emphasized the strategic advantages of the partnership, noting that it would accelerate value creation for investors, reduce debt burden, and fund planned development while allowing Comstock to retain operational control over its assets.
It should be noted that Comstock will remain the operator of all upstream assets and will continue to manage and exercise operational control over Pinnacle Gas Services LLC. SOCAR’s proportional participation in future development programs, as well as in new leases and acquisitions within the area of mutual interest, will be governed by separate agreements within the framework of the final transaction.