Comstock Resources spent most of its Q3 2026 call on how it will pay for its Western Haynesville development. Two deals announced at the end of August shift much of that cost onto partners. On September 1, a partnership owned by Jerry Jones agreed to fund about $450 million to drill 27 wells, 18 of them in the Western Haynesville, which CEO Jay Allison said lets Comstock generate free cash flow in Q4. On November 4, Comstock signed the final agreement to sell Azerbaijan's state oil company, SOCAR, a minority stake in its Haynesville assets and its Pinnacle Gas Services midstream for $1.65 billion, enough to roughly cut its debt in half. SOCAR's LNG trading arm offers a possible route to overseas buyers, though CFO Roland Burns said the terms will take "probably the next year or so" to work out. Production rose 8% from Q2 to about 1,330 MMcf/d, inside guidance, and Comstock guided Q4 to 1,375-1,500 MMcf/d. It didn't restate full-year guidance, but that pace would land 2026 near the bottom of its earlier 1,250-1,400 MMcf/d range.
Costs, particularly in the Western Haynesville, which were the sticking point last quarter, continued to rise (see chart below). COO Dan Harrison blamed larger fracs, shorter laterals and 8-10% inflation since Q2, and said that stripping those out, costs "have been pretty flat." He expects a higher-pressure rig arriving this month to cut drilling days, and a new wider-bore design to be used for "the majority" of future wells. Burns asked for "a little patience," arguing costs will fall as laterals get longer, as they did in the legacy Haynesville.
Source: Comstock Resources
Last quarter, management said it would want "stronger prices" before keeping its nine-rig pace into 2027. Prices haven't obliged, but the partners may have changed that decision. Burns said Comstock will likely keep its fifth Western Haynesville rig busy on extra wells "now that we have support of other partners", and Allison said the SOCAR deal leaves Comstock "a strong balance sheet as we enter 2027." The partners have bought Comstock time in the Western Haynesville, but not lower costs, and that remains the number to watch.
