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S&P: SOCAR to provide Comstock with access to international gas markets

04 September 2026 12:30 (UTC +04:00)

The partnership with SOCAR will create new opportunities for US-based Comstock Resources to sell its natural gas to international customers, APA-Economics reports, citing S&P Global Ratings’ assessment of Comstock Resources’ planned transaction with SOCAR.

S&P noted that SOCAR also provides Comstock Resources with opportunities in the liquefied natural gas (LNG) sector. This could enable the company to expand its international sales channels and develop its trading platform and downstream marketing capabilities.

According to the agency’s assessment, the transaction with SOCAR will also help Comstock Resources offset the free cash flow deficit accumulated since the beginning of the year and improve its financial metrics in the near term.

S&P expects Comstock Resources to use part of the net proceeds from the transaction to reduce borrowings under its credit facility. The company may also repurchase some or all of its 2029 bonds, which become callable in March 2027, and use the proceeds for general corporate purposes, including the development of its 545,000 net acres in Western Haynesville.

At the same time, Comstock Resources will remain the operator of all assets included in the transaction. The company will also retain a controlling stake in Pinnacle Gas Services, with its ownership interest standing at 62% following the transaction.

S&P also positively assessed Comstock Resources’ joint drilling venture with its largest shareholder, Jerry Jones, in the Haynesville shale. Under the project, a partnership owned by the Jones family will fund 80-85% of the costs of drilling and completing 27 wells over the next 12 months. The total cost of the project is expected to be approximately $450 million.

The agency believes that the project will help finance production in Legacy Haynesville, continue the development of the company’s extensive acreage in Western Haynesville, and provide additional gas volumes for Pinnacle Gas Services. At the same time, it will strengthen Comstock Resources’ balance sheet by reducing the company’s upfront capital expenditures.

Although S&P assessed the transaction with SOCAR as credit positive, it left Comstock Resources’ “B” issuer credit rating and “stable” outlook unchanged. The agency attributed this to the fact that the transaction has not yet been definitively signed and that the company’s credit metrics remain highly dependent on natural gas prices.