Stifel's notes from visit with Comstock

[dan_s]

Comstock Resources Inc. (CRK) – DW

Comstock Resources is an independent natural gas producer with operations focused on the development of the Haynesville Shale in North
Louisiana and East Texas. The company is one of the largest producers in the Haynesville, and the only publicly traded Haynesville pure
play with direct access to the Gulf Coast markets and LNG corridor. At Comstock, we met with Jay Allison (Chairman and Chief Executive
Officer), Roland Burns (President and Chief Financial Officer), Daniel Harrison (Chief Operating Officer), and Ronald Mill (Vice President of
Finance and Investor Relations).

In our view, the key takeaways from the meeting were:

Western Haynesville has the potential to be a game changer for Comstock. During our meeting, management discussed the
continued optimism and trajectory for its Western Haynesville assets. While Comstock has not disclosed a map of its acreage position, the
company plans to complete its leasing program by year-end 2023 and disclose its position at that time with a map that demonstrates the
play has been meaningfully de-risked. As evidenced by Figure 1 and messaged by Comstock, management continues to be encouraged
by the prolific nature of the trend. Regarding line of sight, management outlined a potential 2024 development plan that would include a
three-rig program with an average of two wells per pad to enhance capital efficiency. Further, the company intends to target lateral lengths
of +9,000’ lateral lengths with 50% of the wells targeting the Haynesville formation. Of final importance, well performance indicates that
the Haynesville bench is roughly 20% more productive than the Bossier.

Expect increased efficiencies in the Western Haynesville. While the Western Haynesville is one of the more challenging onshore
unconventional plays in the Lower 48 from a depth and temperature perspective, Comstock is advancing its understanding of how to drive
capital efficiencies to further improve the trend’s returns. Importantly, management noted that the geology of the sub-play is less complex
than parts of legacy Haynesville (particularly Shelby Trough) and that it has captured significant seismic data to drive a differentiated
understanding of faulting within the area. Additionally, management has tuned the Baker Hughes motors to better handle the higher
temperature of the deeper wells in the Western Haynesville, which are as deep as 19,000’ when targeting the Haynesville formation.
This efficiency, among others, has been able to help CRK drive down costs within the sub-basin and decrease drilling times by roughly
~24%, from 85 to 65 days per well.

Management is leaning forward on Midstream given their belief in the trend. In addition to de-risking the subsurface, Comstock
is increasingly looking forward to addressing its Midstream needs with aspirations to build a Midstream segment similar to MTDR.
Management notes the company could utilize funding from a private backer to build out 1-2 Bcfpd of gross capacity and retain the option
to buy it back after the financial partner gets its return. Initially, Comstock considered partnering with a Midstream operator to assist in
the buildout of the midstream infrastructure but ultimately concluded that the firm could build the position twice as fast and much more
efficiently by leveraging its own team. Although there was no indication of a start date, management expects the project to commence
in short order.

Other notable items and quotes:
• Assuming continued success in the Western Haynesville, management believes half of its 3P inventory could be Western Haynesville.
• The company wants to have a well in each corner of the Western Haynesville trend by year-end 2024. Once de-risked, management
will likely add a fourth rig in 2025.