Permian Resources (PR) risk factors, FY2025 10-K

Risks Related to Commodity Prices

1. 01Commodity prices are volatile, and a sustained period of low commodity prices for oil, NGLs and natural gas could adversely affect our business, financial condition and results of operations33% rewritten
2. 02These factors, among others, and the volatility of the energy markets make it extremely difficult to predict future oil, NGL and natural gas price movements with any certainty
3. 03If commodity prices decrease to a level such that our future undiscounted cash flows from our properties are less than their carrying value, we may be required to take write-downs of the carrying values of our properties

Risks Related to Our Reserves, Leases and Drilling Locations

1. 04Reserve estimates depend on many assumptions that may turn out to be inaccurate. Any material inaccuracies in reserve estimates or underlying assumptions will materially affect the quantities and present value of our reserves24% rewritten
2. 05Unless we replace our reserves with new reserves and develop those reserves, our reserves and production will decline, which would adversely affect our future cash flows and results of operations
3. 06The development of our estimated PUDs may take longer and may require higher levels of capital expenditures than we currently anticipate. Therefore, our estimated PUDs may not be ultimately developed or produced
4. 07Certain of our undeveloped leasehold acreage is subject to leases that will expire over the next several years unless production is established on units containing the acreage, the primary term is extended through continuous drilling provisions or the leases are renewed
5. 08Our identified drilling locations are scheduled out over many years, making them susceptible to uncertainties that could materially alter the occurrence or timing of their drilling
6. 09Properties that we decide to drill may not yield oil or natural gas in commercially viable quantities

Risks Related to Our Operations

1. 10Our development and acquisition projects require substantial capital expenditures. We may be unable to obtain required capital or financing on satisfactory terms, or at all, which could lead to a decline in our ability to access or grow production and reserves79% rewritten
2. 11other things, oil, NGL and natural gas prices; actual drilling results; the availability of drilling rigs and other services and equipment; and regulatory, technological and competitive developmentsNew
3. 12Drilling for and producing oil and natural gas are high risk activities with many uncertainties that could adversely affect our business, financial condition or results of operations. Additionally, we may not be insured for, or our insurance may be inadequate to protect us against, these risks
4. 13Many of our properties are in areas that may have been partially depleted or drained by offset wells and certain of our wells may be adversely affected by actions other operators may take when drilling, completing, or operating wells that they own
5. 14Part of our strategy involves using some of the latest available horizontal drilling and completion techniques, which involve risks and uncertainties in their application
6. 15Our operations are substantially dependent on the availability of water. Restrictions on our ability to obtain water may have an adverse effect on our financial condition, results of operations and cash flows
7. 16Our ability to produce crude oil, NGLs and natural gas economically and in commercial quantities could be impaired if we are unable to recycle or dispose of the produced water we produce in an economical and environmentally safe manner47% rewritten
8. 17Our producing properties are concentrated in the Permian Basin, making us vulnerable to risks associated with operating in a single geographic area
9. 18The marketability of our production is dependent upon transportation and other facilities, most of which we do not control. If these facilities are unavailable, or if we are unable to access these facilities on commercially reasonable terms, our operations could be interrupted and our revenues reduced27% rewritten
10. 19The unavailability or high cost of additional drilling rigs, equipment, supplies, personnel and oilfield services could adversely affect our ability to execute our development plans within our budget and on a timely basis
11. 20We could experience periods of higher costs if commodity prices rise. These increases could reduce our profitability, cash flow and ability to complete development activities as planned
12. 21We depend upon a small number of significant purchasers for the sale of most of our oil, NGL and natural gas production
13. 22We may incur losses as a result of title defects in the properties in which we invest
14. 23Multi-well pad drilling may result in volatility in our operating results
15. 24We may be unable to make attractive acquisitions or successfully integrate acquired businesses, and any inability to do so may disrupt our business and hinder our ability to grow
16. 25We are heavily dependent on our information and operational technology systems and other digital technologies22% rewritten
17. 26The loss of senior management or technical personnel could adversely affect operations
18. 27We may be unable to compete effectively with larger companies, which may adversely affect our results of operations and financial conditionNew

Risks Related to Our Derivative Transactions, Debt and Access to Capital

1. 28Our derivative activities could result in financial losses or could reduce our earnings86% rewritten
2. 29Our leverage and debt service obligations may adversely affect our financial condition, results of operations, business prospects and our ability to make payments on our outstanding debt
3. 30We may not be able to generate sufficient cash to service all of OpCo’s indebtedness and may be forced to take other actions to satisfy OpCo’s obligations under applicable debt instruments, which may not be successful
4. 31Restrictions in OpCo’s existing and future debt agreements could limit our growth and ability to engage in certain activities40% rewritten
5. 32In addition, OpCo’s Credit Agreement requires us to maintain certain financial ratios or to reduce our indebtedness if we are unable to comply with such ratios. As of December 31, 2025, we were in full compliance with such financial ratios and covenants
6. 33If OpCo is unable to comply with the restrictions and covenants in the agreements governing its indebtedness, there could be a default under the terms of these agreements, which could result in an acceleration of payment of funds that OpCo has borrowed
7. 34Any significant reduction in the borrowing base under OpCo’s revolving credit facility as a result of the periodic borrowing base redeterminations or otherwise may negatively impact our ability to fund our operations
8. 35If we experience liquidity concerns, we could face a downgrade in our debt ratings which could restrict our access to, and negatively impact the terms of, current or future financings or trade credit
9. 36Increases in interest rates could adversely affect our business23% rewritten

Risks Related to Legislative and Regulatory Initiatives

1. 37Federal, 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 oil and natural gas wells and adversely affect our production
2. 38Conservation measures, technological advances and any negative shift in market perception toward the oil and natural gas industry could reduce demand for oil and natural gas
3. 39Our operations may be exposed to significant delays, costs and liabilities as a result of environmental and occupational health and safety requirements applicable to our business activities
4. 40Climate change laws and regulations restricting emissions of GHGs could increase our costs and reduce demand for the oil and natural gas we produce88% rewritten
5. 41Restrictions on drilling activities intended to protect certain species of wildlife may adversely affect our ability to conduct drilling activities in areas where we operate
6. 42A negative shift in investor sentiment towards the oil and natural gas industry and increased attention to sustainability and conservation matters may adversely impact our business76% rewritten
7. 43Any restrictions on oil and natural gas development on federal lands have the potential to adversely impact our operations66% rewritten
8. 44Changes in tax laws or regulations or the interpretation thereof or the imposition of new or increased taxes may increase our future tax liabilities, which could adversely affect our business, results of operation, financial condition and cash flowsNew
9. 45Changes in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, investments and results of operations

Risks Related to Our Common Stock and Capital Structure

1. 46Our cash flow is dependent upon the ability of our operating subsidiaries to make cash distributions to us, the amount of which will depend on various factors
2. 47There may be future sales or other dilution of our equity, which may adversely affect the market price of our common stock
3. 48Provisions contained in our Charter and Bylaws, as well as provisions of Delaware law, could impair a takeover attempt, which may adversely affect the market price of our common stock
4. 49These provisions, alone or together, could delay hostile takeovers and changes in control of the Company or changes in our board of directors and management