Chord Energy (CHRD) risk factors, FY2024 10-K

Risks related to the Arrangement

1. 01The synergies attributable to the Arrangement may vary from expectations
2. 02The market price of our common stock may decline if large amounts of our common stock are sold following the Arrangement and may be affected by factors different from those that historically have affected or currently affect the market price of our common stock

Risks related to the oil and gas industry and our business

1. 03Global geopolitical tensions may create heightened volatility in oil, NGL and natural gas prices and could adversely affect our business, financial condition and results of operations
2. 04A substantial or extended decline in commodity prices, for crude oil and, to a lesser extent, NGLs and natural gas, may adversely affect our business, financial condition or results of operations and our ability to meet our capital expenditure obligations and financial commitments
3. 05The ability or willingness of OPEC+ to set and maintain production levels has a significant impact on oil prices
4. 06Our estimated net proved reserves are based on many assumptions that may turn out to be inaccurate. Any significant inaccuracies in these reserve estimates or underlying assumptions will materially affect the quantities and present value of our reserves
5. 07If crude oil, NGL and natural gas prices decline, or for an extended period of time remain at depressed levels, we may be required to take write-downs of the carrying values of our oil and gas properties and goodwill
6. 08The unavailability or high cost of additional drilling rigs, equipment, supplies, personnel and oilfield services or the unavailability of sufficient transportation for our production could adversely affect our ability to execute our exploration and development plans within our budget and on a timely basis
7. 09Substantially all of our producing properties and operations are located in the Williston Basin making us vulnerable to risks associated with operating in a concentrated geographic area
8. 10Our operations on the Fort Berthold Indian Reservation of the Three Affiliated Tribes in North Dakota are subject to various federal, state, local and tribal regulations and laws, any of which may increase our costs and have an adverse impact on our ability to effectively conduct our operations
9. 11Legal and regulatory challenges to transportation may impact our ability to move volume
10. 12Limited takeaway capacity can result in significant discounts to our realized prices
11. 13The development of our PUD reserves may take longer and may require higher levels of capital expenditures than we currently anticipate. Therefore, our undeveloped reserves may not be ultimately developed or produced
12. 14Unless we replace our crude oil, NGL and natural gas reserves, our reserves and production will decline, which could adversely affect our business, financial condition and results of operations
13. 15Our business is subject to operating risks that could result in substantial losses or liability claims, and we may not be insured for, or our insurance may be inadequate to protect us against these risks
14. 16Drilling locations are scheduled to be drilled over several years and may not yield crude oil, NGLs or natural gas in commercially viable quantities
15. 17Our potential drilling locations are scheduled to be drilled over several years, making them susceptible to uncertainties that could materially alter the occurrence or timing of their drilling
16. 18We are not the operator of all of our drilling locations, and, therefore, we may not be able to control the timing of exploration or development efforts, associated costs, or the rate of production of any non-operated assets
17. 19This limited ability to exercise control over the operations of some of our drilling locations may cause a material adverse effect on our results of operations and financial condition
18. 20Failure to comply with federal, state and local laws and regulations could adversely affect our ability to produce, gather and transport our crude oil, NGLs and natural gas and may result in substantial penalties
19. 21Stakeholder and market attention to matters related to corporate responsibility may impact our business and ability to secure financing
20. 22The SEC’s Final Rules on The Enhancement and Standardization of Climate-Related Disclosures could result in increased compliance risks and costs
21. 23See “Item 1. Business—Regulation—Environmental and occupational health and safety regulation” for more discussion on ESG and climate-related concerns
22. 24Outbreak of infectious diseases could materially adversely affect our business
23. 25Federal, state and local legislative and regulatory initiatives relating to hydraulic fracturing as well as governmental reviews of such activities could result in increased costs and additional operating restrictions or delays in the completion of crude oil and natural gas wells and adversely affect our production
24. 26Laws and regulations pertaining to the protection of threatened and endangered species or to critical habitat, wetlands and natural resources could delay, restrict or prohibit our operations and cause us to incur substantial costs that may have a material adverse effect on our development and production of reserves
25. 27Our ability to produce crude oil, NGLs and natural gas economically and in commercial quantities could be impaired if we are unable to acquire adequate supplies of water for our drilling and completion operations or are unable to dispose of or recycle the water we use economically and in an environmentally safe manner
26. 28Competition in the oil and gas industry is intense, making it more difficult for us to acquire properties, market crude oil, NGLs and natural gas and secure and retain trained personnel
27. 29The loss of senior management or technical personnel could adversely affect our operations
28. 30Seasonal weather conditions could adversely affect our ability to conduct drilling activities in some of the areas where we operate
29. 31We may incur losses as a result of title defects in the properties in which we invest
30. 32Disputes or uncertainties may arise in relation to our royalty obligations

Risks related to our financial position

1. 33Increased costs of capital could adversely affect our business
2. 34Our revolving credit facility and the indentures governing our senior unsecured notes contain operating and financial restrictions that may restrict our business and financing activities
3. 35As a result of these covenants, we are limited in the manner in which we conduct our business, and we may be unable to engage in favorable business activities or finance future operations or capital needs
4. 36Our derivative activities could result in financial losses or could reduce our income
5. 37Our exploration, development and exploitation projects require substantial capital expenditures. We may be unable to obtain needed capital or financing on satisfactory terms, which could lead to expiration of our leases or a decline in our estimated net crude oil, NGL and natural gas reserves
6. 38We may maintain material balances of cash and cash equivalents for extended periods of time at commercial banks in excess of amounts insured by government agencies such as the FDIC
7. 39Our principal exposures to credit risk are through receivables resulting from the sale of our crude oil, NGL and natural gas production, which we market to energy marketing companies, other producers, power generators, local distribution companies, refineries and affiliates, and joint interest receivables
8. 40Changes in tax laws or the interpretation thereof or the imposition of new or increased taxes or fees may adversely affect our operations and cash flows
9. 41We may not be able to utilize all or a portion of our net operating loss carryforwards or other tax benefits to offset future taxable income for U.S. federal or state or Canadian federal tax purposes, which could adversely affect our financial position, results of operations and cash flows
10. 42The enactment of derivatives legislation and regulation could have an adverse effect on our ability to use derivative instruments to reduce the negative effect of commodity price changes, interest rate and other risks associated with our business
11. 43The cost of servicing, and the ability to generate enough cash flows to meet our current or future debt obligations could adversely affect our business. Those risks could increase if we incur more debt
12. 44A negative shift in investor sentiment regarding the oil and gas industry could adversely affect our ability to raise debt and equity capital

Risks related to our common stock

1. 45Our ability to declare and pay dividends is subject to certain considerations and limitations
2. 46Our amended and restated certificate of incorporation, as amended, and amended and restated bylaws, as well as Delaware law, contain provisions that could discourage acquisition bids or merger proposals, which may adversely affect the market price of our common stock
3. 47The exercise of all or any number of outstanding warrants or the issuance of stock-based awards may dilute your holding of shares of our common stock
4. 48The market price of our common stock is subject to volatility
5. 49Involvement in legal, governmental and regulatory proceedings could result in substantial liabilities
6. 50Our profitability may be negatively impacted by inflationary pressures in the cost of labor, materials and services and general economic, business or industry conditions
7. 51Terrorist attacks or cyber-attacks could have a material adverse effect on our business, financial condition or results of operations and could result in information theft or data corruption
8. 52Ineffective internal controls could impact our business and financial results
9. 53We face risks associated with disruptive technologies, innovation and competition, including artificial intelligence