Azerbaijan’s state oil and gas company SOCAR has struck a deal with Comstock to acquire some of its assets in the Haynesville shale and an infrastructure subsidiary. The price tag of the deal is $1.65 billion.
The purchase includes a 20% stake in Comstock’s legacy Haynesville assets, a 15% stake in Western Haynesville, and 15% of Comstock’s majority interest in gas infrastructure subsidiary Pinnacle Gas Services.
The deal comes amid widely shared expectations of extended growth in global demand for natural gas and U.S. growth specifically, amid the Big Tech rush to build data centers and expand in artificial intelligence.
These expectations may now need a bit of a tweak following the Democrats’ victory in the midterm elections, with some of the candidates riding on a landslide after campaigning to rein in data center proliferation. Opposition to data centers has bloomed in all the states where data centers abound, with the chief worry of the opponents being data centers’ energy consumption and the risk of higher electricity bills for everyone as a result of that consumption.
“Data centers were on the ballot, and they got trounced,” Brendan Steinhauser, a former Republican strategist and the chief executive of Alliance for Secure AI, told NBC News. “The moratoria were very popular, data centers were very unpopular, and it was clear across different states and different communities.”
The outlook for natural gas demand, however, is likely to remain rather robust even if data center construction in the United States slows down. Although emission cuts have dropped out of the spotlight recently, elbowed out by war-driven fears of oil and gas shortages, next week’s COP31 is likely to bring the topic up for discussion again. Gas is widely considered to be the simplest alternative to coal generation, providing baseload power supply at much lower pollution and CO2 emission rates.
By Charles Kennedy for Oilprice.com
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