SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)
|
6 Months Ended |
Jun. 30, 2026 |
|---|
| Accounting Policies [Abstract] |
|
| Schedule of Other Current Assets |
Other current assets at June 30, 2026 and December 31, 2025 consisted of the following:
|
|
|
|
|
|
|
|
|
|
|
As of |
|
|
|
June 30,
2026 |
|
|
December 31,
2025 |
|
|
|
(In thousands) |
|
Prepaid drilling costs |
|
$ |
34,943 |
|
|
$ |
53,134 |
|
Prepaid expenses |
|
|
19,461 |
|
|
|
5,684 |
|
Income tax receivable |
|
|
3,024 |
|
|
|
3,024 |
|
Production tax refunds receivable |
|
|
2,307 |
|
|
|
5,827 |
|
Other |
|
|
69 |
|
|
|
7,588 |
|
|
|
$ |
59,804 |
|
|
$ |
75,257 |
|
|
| Capitalized Exploratory Well Costs |
The changes in capitalized exploratory well costs are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
|
(In thousands) |
|
Beginning capitalized exploratory well costs |
|
$ |
232,390 |
|
|
$ |
168,330 |
|
|
$ |
210,127 |
|
|
$ |
68,223 |
|
Additions to exploratory well costs pending the determination of proved reserves |
|
|
174,359 |
|
|
|
130,997 |
|
|
|
349,134 |
|
|
|
231,104 |
|
Determined to have found proved reserves |
|
|
(137,198 |
) |
|
|
(147,354 |
) |
|
|
(289,710 |
) |
|
|
(147,354 |
) |
Ending capitalized exploratory well costs |
|
$ |
269,551 |
|
|
$ |
151,973 |
|
|
$ |
269,551 |
|
|
$ |
151,973 |
|
|
| Summary of Balances of Other Property and Equipment and Accumulated Depreciation |
The following table presents the balance of other property and equipment and accumulated depreciation as of June 30, 2026 and December 31, 2025:
|
|
|
|
|
|
|
|
|
|
|
As of |
|
|
|
June 30,
2026 |
|
|
December 31,
2025 |
|
|
|
(in thousands) |
|
Midstream assets |
|
$ |
454,482 |
|
|
$ |
363,855 |
|
Accumulated depreciation |
|
|
(7,708 |
) |
|
|
(4,914 |
) |
Net midstream assets |
|
|
446,774 |
|
|
|
358,941 |
|
|
|
|
|
|
|
|
Other property and equipment |
|
|
22,913 |
|
|
|
22,801 |
|
Accumulated depreciation |
|
|
(2,737 |
) |
|
|
(1,982 |
) |
Net other property and equipment |
|
|
20,176 |
|
|
|
20,819 |
|
|
|
|
|
|
|
|
Total |
|
$ |
466,950 |
|
|
$ |
379,760 |
|
|
| Summary of Lease Cost Recognized |
Lease costs recognized during the three months and six months ended June 30, 2026 and 2025 were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
|
(In thousands) |
|
Operating lease cost included in general and administrative expense |
|
$ |
426 |
|
|
$ |
426 |
|
|
$ |
845 |
|
|
$ |
851 |
|
Operating lease cost included in lease operating expense |
|
|
574 |
|
|
|
527 |
|
|
|
1,179 |
|
|
|
1,043 |
|
Operating lease cost included in natural gas and oil properties |
|
|
12,147 |
|
|
|
12,364 |
|
|
|
24,295 |
|
|
|
23,664 |
|
Variable lease cost (drilling rig costs included in natural gas and oil properties) |
|
|
3,351 |
|
|
|
877 |
|
|
|
15,650 |
|
|
|
2,598 |
|
Short-term lease cost (drilling rig costs included in natural gas and oil properties) |
|
|
13,244 |
|
|
|
9,212 |
|
|
|
25,392 |
|
|
|
14,599 |
|
|
|
$ |
29,742 |
|
|
$ |
23,406 |
|
|
$ |
67,361 |
|
|
$ |
42,755 |
|
|
| Summary of Liabilities Under Contracts That Contain Operating Leases |
As of June 30, 2026, expected future payments related to contracts that contain operating leases were as follows:
|
|
|
|
|
|
|
(In thousands) |
|
July 1 to December 31, 2026 |
|
$ |
25,078 |
|
2027 |
|
|
29,338 |
|
2028 |
|
|
14,641 |
|
2029 |
|
|
7,488 |
|
2030 |
|
|
4 |
|
Total lease payments |
|
|
76,549 |
|
Imputed interest |
|
|
(5,381 |
) |
Total lease liability |
|
$ |
71,168 |
|
|
| Summary of Accrued Costs |
Accrued costs at June 30, 2026 and December 31, 2025 consisted of the following:
|
|
|
|
|
|
|
|
|
|
|
As of |
|
|
|
June 30,
2026 |
|
|
December 31,
2025 |
|
|
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accrued interest payable |
|
$ |
63,404 |
|
|
$ |
64,042 |
|
Accrued drilling costs |
|
|
52,326 |
|
|
|
36,148 |
|
Accrued transportation costs |
|
|
31,155 |
|
|
|
28,304 |
|
Accrued ad valorem and other taxes |
|
|
12,600 |
|
|
|
4,000 |
|
Accrued employee compensation |
|
|
5,877 |
|
|
|
14,926 |
|
Accrued lease operating expenses |
|
|
2,891 |
|
|
|
3,744 |
|
Other |
|
|
2,934 |
|
|
|
2,084 |
|
|
|
$ |
171,187 |
|
|
$ |
153,248 |
|
|
| Summary of Changes in Total Estimated Asset Retirement Obligation Liability |
The following table summarizes the changes in Comstock's total estimated liability for such obligations during the periods presented:
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30, |
|
|
|
2026 |
|
|
2025 |
|
|
|
(In thousands) |
|
Reserve for future abandonment costs at beginning of period |
|
$ |
20,787 |
|
|
$ |
33,996 |
|
New wells and facilities placed on production |
|
|
83 |
|
|
|
51 |
|
Liabilities settled |
|
|
(29 |
) |
|
|
(34 |
) |
Accretion expense |
|
|
603 |
|
|
|
995 |
|
Reserve for future abandonment costs at end of period |
|
$ |
21,444 |
|
|
$ |
35,008 |
|
|
| Schedule of Natural Gas Price Derivative |
The Company had the following natural gas price derivative financial instruments at June 30, 2026:
|
|
|
|
|
|
|
|
|
Future Production Period |
|
|
Six Months Ending
December 31, 2026 |
|
Year Ending
December 31, 2027 |
|
Total |
Natural Gas Price Swap Contracts: |
|
|
|
|
|
|
Volume (MMBtu) |
|
58,880,000 |
|
— |
|
58,880,000 |
Average Price per MMBtu |
|
$3.51 |
|
$— |
|
$3.51 |
Natural Gas Price Collar Contracts: |
|
|
|
|
|
|
Volume (MMBtu) |
|
84,640,000 |
|
146,000,000 |
|
230,640,000 |
Average Price per MMBtu: |
|
|
|
|
|
|
Average Ceiling |
|
$4.35 |
|
$4.44 |
|
$4.41 |
Average Floor |
|
$3.50 |
|
$3.50 |
|
$3.50 |
|
| Schedule of Derivative Instruments |
The classification of derivative financial instruments of assets or liabilities, consists of the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of |
|
Type |
|
Consolidated Balance Sheet Location |
|
June 30,
2026 |
|
|
December 31,
2025 |
|
|
|
|
|
(In thousands) |
|
Asset Derivative Financial Instruments: |
|
|
|
|
|
|
Natural gas price derivatives |
|
Derivative Financial Instruments – current |
|
$ |
53,156 |
|
|
$ |
19,206 |
|
Natural gas price derivatives |
|
Derivative Financial Instruments – long-term |
|
$ |
22,230 |
|
|
$ |
— |
|
Liability Derivative Financial Instruments: |
|
|
|
|
|
|
Natural gas price derivatives |
|
Derivative Financial Instruments – current |
|
$ |
— |
|
|
$ |
27,636 |
|
|
| Schedule of Gains and Losses from Derivative Contracts |
Gains and losses related to cash settlements and changes in the fair value recognized on the Company's derivative contracts recognized in the consolidated statement of operations were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
Gain (loss) on Derivatives Recognized in Earnings |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
|
(In thousands) |
|
Natural gas price derivatives |
|
$ |
44,365 |
|
|
$ |
235,847 |
|
|
$ |
46,761 |
|
|
$ |
(94,492 |
) |
|
|
$ |
44,365 |
|
|
$ |
235,847 |
|
|
$ |
46,761 |
|
|
$ |
(94,492 |
) |
|
| Consolidated Income Tax Benefit |
The following is an analysis of the consolidated income tax provision (benefit):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
|
(In thousands) |
|
Current - Federal |
|
$ |
— |
|
|
$ |
(1,710 |
) |
|
$ |
— |
|
|
$ |
(1,710 |
) |
Current - State |
|
|
— |
|
|
|
36 |
|
|
|
— |
|
|
|
36 |
|
Deferred - Federal |
|
|
(742 |
) |
|
|
66,010 |
|
|
|
18,082 |
|
|
|
80 |
|
Deferred - State |
|
|
(2,095 |
) |
|
|
77,151 |
|
|
|
(8,929 |
) |
|
|
(195 |
) |
|
|
$ |
(2,837 |
) |
|
$ |
141,487 |
|
|
$ |
9,153 |
|
|
$ |
(1,789 |
) |
|
| Difference Between Federal Statutory Rate and Effective Tax Rate |
The difference between the federal statutory rate of 21% and the effective tax rate is due to the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
Tax at statutory rate |
|
|
21.0 |
% |
|
|
21.0 |
% |
|
|
21.0 |
% |
|
|
21.0 |
% |
Tax effect of: |
|
|
|
|
|
|
|
|
|
|
|
|
Research and development and other income tax credits |
|
|
(20.8 |
) |
|
|
(1.0 |
) |
|
|
(5.9 |
) |
|
|
(20.3 |
) |
State income taxes, net of federal benefit |
|
|
(23.8 |
) |
|
|
28.4 |
|
|
|
(5.3 |
) |
|
|
(1.2 |
) |
Valuation allowance on deferred tax assets |
|
|
— |
|
|
|
— |
|
|
|
(3.1 |
) |
|
|
0.8 |
|
Noncontrolling interest |
|
|
(9.1 |
) |
|
|
10.4 |
|
|
|
(2.1 |
) |
|
|
(3.4 |
) |
Nondeductible stock-based compensation |
|
|
9.3 |
|
|
|
(6.6 |
) |
|
|
2.1 |
|
|
|
(7.0 |
) |
Other |
|
|
0.1 |
|
|
|
(0.2 |
) |
|
|
— |
|
|
|
(3.1 |
) |
Effective tax rate |
|
|
(23.3 |
)% |
|
|
52.0 |
% |
|
|
6.7 |
% |
|
|
(13.2 |
)% |
|
| Summary of Carrying Amounts and Fair Values of Financial Instruments |
The following presents the carrying amounts and the fair values of the Company's financial instruments as of June 30, 2026 and December 31, 2025:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of |
|
|
|
June 30, 2026 |
|
|
December 31, 2025 |
|
|
|
Carrying Value |
|
|
Fair Value |
|
|
Carrying Value |
|
|
Fair Value |
|
|
|
(In thousands) |
|
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
Commodity-based derivatives (1) |
|
$ |
75,386 |
|
|
$ |
75,386 |
|
|
$ |
19,206 |
|
|
$ |
19,206 |
|
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
Commodity-based derivatives (1) |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
27,636 |
|
|
$ |
27,636 |
|
Bank credit facilities (2) |
|
$ |
545,000 |
|
|
$ |
545,000 |
|
|
$ |
260,000 |
|
|
$ |
260,000 |
|
6.75% senior notes due 2029 (3) |
|
$ |
1,610,099 |
|
|
$ |
1,592,962 |
|
|
$ |
1,607,880 |
|
|
$ |
1,603,582 |
|
5.875% senior notes due 2030 (3) |
|
$ |
965,000 |
|
|
$ |
904,688 |
|
|
$ |
965,000 |
|
|
$ |
931,225 |
|
(1)The Company's commodity-based derivatives are classified as Level 2 and measured at fair value using third party pricing services and other active markets or broker quotes that are readily available in the public markets. (2)The carrying value of the Company's floating rate debt outstanding approximates fair value. (3)The fair value of the Company's fixed rate debt was based on quoted prices as of June 30, 2026 and December 31, 2025, respectively, a Level 1 measurement.
|
| Weighted Average Shares of Unvested Restricted Stock |
Weighted average shares of unvested restricted stock outstanding were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30, |
|
|
Six Months Ended
June 30, |
|
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
|
|
(In thousands) |
|
Unvested restricted stock |
|
|
2,057 |
|
|
|
2,342 |
|
|
|
2,151 |
|
|
|
2,330 |
|
|
| Common Stock and Convertible Stock Dilutive in Weighted average unearned PSUs outstanding |
Weighted average unearned PSUs outstanding were as follows:
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
|
|
2026 |
|
2025 |
|
2026 |
|
2025 |
|
|
(In thousands, except per unit amounts) |
Weighted average PSUs |
|
2,099 |
|
1,411 |
|
2,064 |
|
1,351 |
Weighted average grant date fair value per unit |
|
$23.43 |
|
$19.46 |
|
$23.43 |
|
$19.46 |
|
| Schedule of Basic and Diluted Income Per Share |
Basic and diluted income per share for the three months and six months ended June 30, 2026 and 2025 were determined as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, |
|
|
|
2026 |
|
|
2025 |
|
|
|
Income |
|
|
Shares |
|
|
Per Share |
|
|
Income |
|
|
Shares |
|
|
Per Share |
|
|
|
(In thousands, except per share amounts) |
|
Net income available to the Company |
|
$ |
8,766 |
|
|
|
|
|
|
|
|
$ |
130,728 |
|
|
|
|
|
|
|
Income allocable to unvested restricted stock |
|
|
(61 |
) |
|
|
|
|
|
|
|
|
(1,045 |
) |
|
|
|
|
|
|
Basic income available to the Company |
|
$ |
8,705 |
|
|
|
291,612 |
|
|
$ |
0.03 |
|
|
$ |
129,683 |
|
|
|
290,604 |
|
|
$ |
0.45 |
|
Effect of Dilutive Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restricted stock |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
1,045 |
|
|
|
1,364 |
|
|
|
|
Performance stock units |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
2,279 |
|
|
|
|
Diluted income available to the Company |
|
$ |
8,705 |
|
|
|
291,612 |
|
|
$ |
0.03 |
|
|
$ |
130,728 |
|
|
|
294,247 |
|
|
$ |
0.44 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, |
|
|
|
2026 |
|
|
2025 |
|
|
|
Income |
|
|
Shares |
|
|
Per Share |
|
|
Income |
|
|
Shares |
|
|
Per Share |
|
|
|
(In thousands, except per share amounts) |
|
Net income available to the Company |
|
$ |
116,216 |
|
|
|
|
|
|
|
|
$ |
15,335 |
|
|
|
|
|
|
|
Income allocable to unvested restricted stock |
|
|
(852 |
) |
|
|
|
|
|
|
|
|
(122 |
) |
|
|
|
|
|
|
Basic income available to the Company |
|
$ |
115,364 |
|
|
|
291,465 |
|
|
$ |
0.40 |
|
|
$ |
15,213 |
|
|
|
290,455 |
|
|
$ |
0.05 |
|
Effect of Dilutive Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restricted stock |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
122 |
|
|
|
1,350 |
|
|
|
|
Performance stock units |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
2,221 |
|
|
|
|
Diluted income available to the Company |
|
$ |
115,364 |
|
|
|
291,465 |
|
|
$ |
0.40 |
|
|
$ |
15,335 |
|
|
|
294,026 |
|
|
$ |
0.05 |
|
|
| Cash Payments Made for Interest and Income Taxes |
Cash payments made for interest and income taxes and other non-cash investing activities for the six months ended June 30, 2026 and 2025, respectively, were as follows:
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30, |
|
|
|
2026 |
|
|
2025 |
|
|
|
(In thousands) |
|
Cash payments for: |
|
|
|
|
|
|
Interest payments |
|
$ |
102,541 |
|
|
$ |
104,733 |
|
Income tax payments (refunds) |
|
$ |
— |
|
|
$ |
(31,000 |
) |
Non-cash investing activities include: |
|
|
|
|
|
|
Increase (decrease) in accrued capital expenditures |
|
$ |
16,178 |
|
|
$ |
(2,575 |
) |
Liabilities assumed in exchange for right-of-use lease assets |
|
$ |
453 |
|
|
$ |
36,244 |
|
|