What the changes say
- Concentration of properties in the Rockies and federal waters offshore Southern California heightens regional operational risks.
- Customer concentration increased, highlighted by the Phillips 66 Los Angeles refinery closure impacting sales volume.
What changed since the prior 10-K
New
- NewRisks Related to Our Business
Our properties are concentrated in a limited number of geographic locations and adverse developments, including potential difficulties in the marketing of oil, in such operating areas could adversely affect our business, financial condition, results of operations and cash flows
Following divestitures by December 31, 2025, properties are concentrated in the Rockies and federal waters offshore Southern California, increasing vulnerability to regional disruptions.
- NewRisks Related to Our Business
Additionally, if we are unable to utilize CO2 for EOR purposes consistent with the Section 45Q Credit requirements, or the CO2 that we purchase leaks from our EOR wells, we will have an indemnity obligation to our CO2 supplier, which will eliminate the savings to which we would otherwise be entitled
Failure to meet Section 45Q Credit requirements or CO2 leaks from EOR wells at Bairoil triggers indemnity obligations to the CO2 supplier, eliminating price savings.
Dropped
- DroppedRisks Related to Our Business
If commodity prices decline for a prolonged period, a significant portion of our development projects may become uneconomic and result in write downs of the value of our oil and natural gas properties, which may adversely affect our financial condition and our ability to fund our operations
Risk of development project write downs from prolonged commodity price declines.
- DroppedRisks Related to Our Business
Adverse developments in our operating areas could adversely affect our business, financial condition, results of operations and cash flows
- DroppedRisks Related to Our Business
We are exposed to trade credit risk in the event of nonperformance by our vendors and other counterparties in the ordinary course of our business activities
- DroppedRisks Related to Our Business
We have limited control over the activities on properties we do not operate
- DroppedRisks Related to Our Business
See “Item 1. Business — Environmental, Occupational Health and Safety Matters and Regulations” and “— Other Regulation of the Oil and Natural Gas Industry” for a description of the more significant laws and regulations that affect us
- DroppedRisks Related to Our Business
Federal and state legislative and regulatory initiatives relating to hydraulic fracturing could result in increased costs and additional operating restrictions or delays and adversely affect our production
- DroppedRisks Related to Our Business
We may be subject to increased permitting obligations and regulatory scrutiny as a result of the Incident
- DroppedRisks Related to the Mergers
The Mergers are subject to closing conditions and may not be completed, the Merger Agreement may be terminated in accordance with its terms, and we may be required to pay a termination fee or reimburse expenses upon termination
- DroppedRisks Related to the Mergers
The consideration payable under the Merger Agreement is fixed and will not be adjusted based on our performance
- DroppedRisks Related to the Mergers
We will be subject to business uncertainties and contractual restrictions, including the risk of litigation, while the Mergers are pending that may cause disruption and may make it more difficult to maintain relationships with employees, suppliers or customers
- DroppedRisks Related to the Mergers
Until the completion of the Mergers or the termination of the Merger Agreement in accordance with its terms, we are prohibited from entering into certain transactions and taking certain actions that might otherwise be beneficial to us and our stockholders
- DroppedRisks Related to the Mergers
The Merger Agreement limits our ability to pursue alternatives to the Mergers and may discourage a potential competing acquirer of Amplify Energy, including the payment by Amplify Energy of a termination fee
- DroppedRisks Related to the Mergers
Affiliates of Amplify Energy may have interests in the Mergers that are different from, or in addition to, the interests of Amplify Energy’s other stockholders
- DroppedRisks Related to the Mergers
Current Amplify Energy stockholders will have a reduced ownership and voting interest in Amplify Energy after the Mergers compared to their current ownership and will exercise less influence over management
- DroppedRisks Related to the Mergers
The Mergers will involve substantial costs
- DroppedRisks Related to the Mergers
Securities class action and derivative lawsuits may be filed against us, or against our directors, challenging the Mergers, and an adverse ruling in any such lawsuit may prevent the Mergers from becoming effective or from becoming effective within the expected time frame
- DroppedRisks Related to the Mergers
We expect to refinance substantial indebtedness of the Acquired Companies in connection with the Mergers, which combined with our current debt may limit our financial flexibility and adversely affect our financial results
- DroppedRisks Related to the Mergers
Any of these risks could materially impact our ability to fund our operations or limit our ability to expand the combined business, which could have a material adverse effect on the combined company, its financial condition and results of operations
- DroppedRisks Related to the Mergers
The Acquired Companies are currently not U.S. public reporting companies, and the obligations associated with integrating into a public company may require significant resources and management attention
Reworded
- 79% rewrittenRisks Related to Our Business
Our lenders periodically redetermine the amount we may borrow under our Revolving Credit Facility, which may materially impact our operations
Updated borrowing base property descriptions to remove natural gas reserves, focusing strictly on oil and NGL reserves for lenders' redeterminations.
- 72% rewrittenRisks Related to Our Business
Our business could be negatively affected by security threats, including cybersecurity threats, destructive forms of protest and opposition by activists and other disruptions
Retained substantially identical security and cybersecurity threat warnings without material substantive changes.
- 63% rewrittenRisks Related to Our Business
The production from our Bairoil properties could be adversely affected by the cessation or interruption of the supply of CO2 to those properties
Retained the risk regarding Bairoil CO2 supply interruptions and enhanced recovery prediction difficulties without substantive changes.
- 61% rewrittenRisks Related to Our Business
We are dependent upon a small number of significant customers for the majority of our production sales. The loss of those customers, if not replaced, could reduce our revenues and have a material adverse effect on our financial condition and results of operations
Customer concentration shifted from three customers representing 10% or more of revenues in 2024 down to two customers in 2025, noting potential production shut-ins from the Phillips 66 Los Angeles refinery closure.
Was: We are dependent upon a small number of significant customers for a substantial portion of our production sales. The loss of those customers, if not replaced, could reduce our revenues and have a material adverse effect on our financial condition and results of operations
- 53% rewrittenRisks Related to Our Business
The inability of our significant customers, vendors or other counterparties to meet their obligations to us may adversely affect our financial results
Maintained receivables credit risk disclosures regarding customer nonpayment and defaults with minor phrasing polish.
Was: The inability of our significant customers to meet their obligations to us may adversely affect our financial results
- 47% rewrittenRisks Related to Our Business
Increasing scrutiny and changing stakeholder expectations in respect of environmental, social and governance (“ESG”) and sustainability practices may have an adverse effect on our business, financial condition and results of operations and damage our reputation
Retained stakeholder and ESG scrutiny reputational risks with minor introductory wording updates.
- 41% rewrittenRisks Related to Our Business
Oil and natural gas producers’ operations, are substantially dependent on the availability of water and the disposal of waste, including produced water and drilling fluids. Restrictions on the ability to obtain water or dispose of waste may impact our operations
Removed hydraulic fracturing specifically from water dependency references during the drilling process.
Was: Oil and natural gas producers’ operations, especially those using hydraulic fracturing, are substantially dependent on the availability of water and the disposal of waste, including produced water and drilling fluids. Restrictions on the ability to obtain water or dispose of waste may impact our operations
- 34% rewrittenRisks Related to Our Business
Certain U.S. federal income tax deductions currently available with respect to oil and natural gas exploration and production may be eliminated as a result of future legislation
Refined historical tax legislation phrasing to broader descriptions of periodically proposed tax code changes.
- 23% rewrittenRisks Related to Our Business
Part of our strategy may involve using horizontal drilling and completion techniques, which involve risks and uncertainties in their application
- 23% rewrittenRisks Related to Our Business
The failure to replace our proved oil reserves could adversely affect our business, financial condition, results of operations, production and cash flows
Was: The failure to replace our proved oil and natural gas reserves could adversely affect our business, financial condition, results of operations, production and cash flows
All 37 risk factors
Headings as the filing states them, in filing order.
Risks Related to Our Business
- 01We are dependent upon a small number of significant customers for the majority of our production sales. The loss of those customers, if not replaced, could reduce our revenues and have a material adverse effect on our financial condition and results of operations61% rewritten
- 02Our business could be adversely affected by a decline in general economic conditions or a weakening of the broader energy industry, and inflation may adversely affect our financial position and operating results
- 03Our properties are concentrated in a limited number of geographic locations and adverse developments, including potential difficulties in the marketing of oil, in such operating areas could adversely affect our business, financial condition, results of operations and cash flowsNew
- 04The inability of our significant customers, vendors or other counterparties to meet their obligations to us may adversely affect our financial results53% rewritten
- 05We are subject to, and in the future may be subject to additional complex federal, state, local and other laws and regulations that could adversely affect the cost, manner or feasibility of conducting our operations
- 06An increase in the differential between the NYMEX or other benchmark prices of oil and natural gas and the wellhead price we receive for our production could significantly reduce our cash flow and adversely affect our financial condition
- 07The production from our Bairoil properties could be adversely affected by the cessation or interruption of the supply of CO2 to those properties63% rewritten
- 08Additionally, if we are unable to utilize CO2 for EOR purposes consistent with the Section 45Q Credit requirements, or the CO2 that we purchase leaks from our EOR wells, we will have an indemnity obligation to our CO2 supplier, which will eliminate the savings to which we would otherwise be entitledNew
- 09The failure to replace our proved oil reserves could adversely affect our business, financial condition, results of operations, production and cash flows23% rewritten
- 10Our estimated reserves and future production rates are based on many assumptions that may turn out to be inaccurate. Any material inaccuracies in our reserve estimates or underlying assumptions will materially affect the quantities and present value of our estimated reserves
- 11The process also requires economic assumptions about matters such as natural gas and oil prices, drilling and operating expenses, capital expenditures and availability of funds
- 12The standardized measure of our estimated proved reserves is not necessarily the same as the current market value of our estimated proved oil and natural gas reserves
- 13Developing and producing oil and natural gas are costly and high-risk activities with many uncertainties that may result in a total loss of investment or otherwise adversely affect our business, financial condition, results of operations and cash flows
- 14Expenses not covered by our insurance could have a material adverse effect on our financial position and results of operations
- 15Our business depends in part on pipelines, gathering systems and processing facilities owned by us or others. Any limitation in the availability of those facilities could interfere with our ability to market our oil production
- 16Development and production of oil and natural gas in offshore waters have inherent and historically higher risk than similar activities onshore
- 17Our hedging strategy may not effectively mitigate the impact of commodity price volatility from our cash flows, and our hedging activities could result in cash losses and may limit potential gains
- 18Many of our properties are in areas that may have been partially depleted or drained
- 19Our expectations for future development activities are planned to be realized over several years, making them susceptible to uncertainties that could materially alter the occurrence or timing of such activities
- 20Loss of our key executive officers or other key personnel, or an inability to attract and retain such officers and personnel, could negatively affect our business
- 21Part of our strategy may involve using horizontal drilling and completion techniques, which involve risks and uncertainties in their application23% rewritten
- 22Our potential use of 2-D and 3-D seismic data is subject to interpretation and may not accurately identify the presence of oil and natural gas, which could adversely affect the results of our drilling operations
- 23SEC rules could limit our ability to book additional PUDs in the future
- 24The unavailability or high cost of equipment, supplies and crews could delay our operations, increase our costs and delay forecasted revenue
- 25We may incur losses as a result of title defects in the properties in which we invest
- 26We may be unable to compete effectively with larger companies
- 27We may be unable to maintain compliance with the covenants in the Revolving Credit Facility, which could result in an event of default thereunder that, if not cured or waived, would have a material adverse effect on our business and financial condition
- 28Restrictive covenants in our Revolving Credit Facility could limit our growth and our ability to finance our operations, fund our capital needs, respond to changing conditions and engage in other business activities that may be in our best interests
- 29Our variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase
- 30Our lenders periodically redetermine the amount we may borrow under our Revolving Credit Facility, which may materially impact our operations79% rewritten
- 31Increasing scrutiny and changing stakeholder expectations in respect of environmental, social and governance (“ESG”) and sustainability practices may have an adverse effect on our business, financial condition and results of operations and damage our reputation47% rewritten
- 32The listing of a species as either “threatened” or “endangered” under the federal Endangered Species Act could result in increased costs, new operating restrictions, or delays in our operations, which could adversely affect our results of operations and financial condition
- 33The third parties on whom we rely for gathering and transportation services are subject to complex federal, state and other laws that could adversely affect the cost, manner or feasibility of conducting our business
- 34Oil and natural gas producers’ operations, are substantially dependent on the availability of water and the disposal of waste, including produced water and drilling fluids. Restrictions on the ability to obtain water or dispose of waste may impact our operations41% rewritten
- 35The cost of decommissioning is uncertain
- 36Certain U.S. federal income tax deductions currently available with respect to oil and natural gas exploration and production may be eliminated as a result of future legislation34% rewritten
- 37Our business could be negatively affected by security threats, including cybersecurity threats, destructive forms of protest and opposition by activists and other disruptions72% rewritten
Other Amplify Energy 10-Ks
- FY2024 10-K risk factors54 risks
Amplify Energy relies heavily on variable-rate credit facilities and commodity hedging to offset volatility in oil and gas prices. Operations face concentrated geographic risks, customer concentration, and stringent regulatory compliance burdens across multiple jurisdictions. Environmental regulations and water disposal access pose ongoing threats to drilling and production feasibility.
Filed Mar 05, 2025
About this page
The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.