Pure compact U (1) lattice gauge theory exhibits a phase transition at gauge coupling g ∼ O(1) separating a familiar weak coupling Coulomb phase, having free massless photons, from a strong coupling phase. However, the phase transition was found to be of first order, ruling out any nontrivial theory resulting from a continuum limit from the strong coupling side. In this work, a compact U (1) lattice gauge theory is studied with addition of a dimension-two mass counterterm and a higher derivative (HD) term that ensures a unique vacuum and produces a covariant gauge-fixing term in the naive continuum limit. For a reasonably large coefficient of the HD term, now there exists a continuous transition from a regular ordered phase to a spatially modulated ordered phase. For weak gauge couplings, a continuum limit from the regular ordered phase results in a familiar theory consisting of free massless photons. For strong gauge couplings with g ≥ O(1), this transition changes from first order to continuous as the coefficient of the HD term is increased, resulting in tricritical points which appear to be a candidate in this theory for a possible nontrivial continuum limit.