APA (APA) risk factors, FY2024 10-K

RISKS RELATED TO PRICING, DEMAND, AND PRODUCTION FOR CRUDE OIL, NATURAL GAS, AND NGLs

1. 01Crude oil, natural gas, and NGL prices and their volatility could adversely affect the Company’s operating results and the price of APA’s common stock
2. 02The Company has previously not realized, and may in the future not realize, an adequate return on wells that it drills
3. 03The Company’s commodity price risk management and trading activities may prevent it from benefiting fully from price increases and may expose it to other risks
4. 04Global pandemics have previously, may continue to, and may in the future adversely impact the Company’s business, financial condition, and results of operations; the global economy; the demand for and prices of oil, natural gas, and NGLs; and the performance of the Company’s workforce

RISKS RELATED TO OPERATIONS AND DEVELOPMENT PROJECTS

1. 05The Company’s operations involve a high degree of operational risk, particularly risk of personal injury, damage to or loss of property, and environmental accidents
2. 06Weather and climate may have a significant adverse impact on the Company’s revenues and production
3. 07The Company’s insurance policies do not cover all of the risks the Company faces, which could result in significant financial exposure
4. 08A cyberattack targeting systems and infrastructure used by the Company or others in the oil and gas industry may adversely impact the Company’s operations
5. 09Material differences between the estimated and actual timing of critical events or costs may affect the completion and commencement of production from development projects

RISKS RELATED TO RESERVES AND LEASEHOLD ACREAGE

1. 10Discoveries or acquisitions of additional reserves are needed to avoid a material decline in reserves and production
2. 11The Company may fail to fully identify potential problems related to acquired reserves or to properly estimate those reserves
3. 12Crude oil, natural gas, and NGL reserves are estimates, and actual recoveries may vary significantly
4. 13Certain of the Company’s undeveloped leasehold acreage is subject to leases that will expire over the next several years unless production is established on units containing the acreage

RISKS RELATED TO COUNTERPARTIES

1. 14The credit risk of financial institutions could adversely affect the Company and result in a significant loss
2. 15The Company’s liabilities, including for the decommissioning of previously owned assets, could be adversely affected in the event one or more of its transaction counterparties are financially distressed or become the subject of a bankruptcy case
3. 16The Company does not always control decisions made under joint operating agreements or joint ventures, and the parties to such agreements or ventures may fail to meet their obligations

RISKS RELATED TO CAPITAL MARKETS

1. 17A downgrade in the Company’s credit rating could negatively impact its cost of and ability to access capital
2. 18Market conditions may restrict the Company’s ability to obtain funds for future development and working capital needs, which may limit its financial flexibility
3. 19The Company’s ability to declare and pay dividends, and to repurchase common stock, is subject to limitations

RISKS RELATED TO FINANCIAL RESULTS

1. 20The Company faces strong industry competition that may have a significant negative impact on the Company’s results of operations
2. 21The Company’s ability to utilize net operating losses and other tax attributes to reduce future taxable income may be limited if the Company experiences an ownership change
3. 22The Company’s ability to realize its deferred tax assets may be limited if it experiences changes in expected future cash flows related to reserves or ARO
4. 23APA is a holding company and is dependent on the operations of and distributions from its subsidiaries, including Apache

RISKS RELATED TO GOVERNMENTAL REGULATION AND POLITICAL RISKS

1. 24The Company may incur significant costs related to environmental matters
2. 25The Company’s U.S. operations are subject to governmental risks
3. 26Proposed federal, state, or local regulation regarding hydraulic fracturing could increase the Company’s operating and capital costs
4. 27Changes in tax rules and regulations, or interpretations thereof, may adversely affect the Company’s business, financial condition, and results of operations

RISKS RELATED TO CLIMATE CHANGE

1. 28The impacts of energy transition could adversely affect the Company’s business, operating results, and financial condition
2. 29development of, and increased demand from consumers and industries for, lower-emission products and services, including electric vehicles and renewable residential and commercial power supplies, as well as more energy-efficient products and services
3. 30Changes to existing regulations related to emissions and the impact of any changes in climate could adversely impact the Company’s business
4. 31Enhanced focus on ESG matters could have an adverse effect on the Company’s operations
5. 32The Company’s estimates used in various scenario planning analyses could differ materially from actual results and could expose the Company to new or additional risks
6. 33The treatment and disposal of produced water is becoming more highly regulated and restricted and could expose the Company to additional costs or limit certain operations

RISKS RELATED TO INTERNATIONAL OPERATIONS

1. 34International operations have uncertain political, economic, and other risks
2. 35A further deterioration of conditions in Egypt or changes in the economic and political environment in Egypt could have an adverse impact on the Company’s business
3. 36The Company’s operations are sensitive to currency rate fluctuations
4. 37Certain anti-takeover provisions in the Company’s charter and Delaware law could delay or prevent a hostile takeover