1101661--8/13/2008--SONORAN_ENERGY

related topics

{gas, price, oil}

{loss, insurance, financial}

{acquisition, growth, future}

{personnel, key, retain}

{competitive, industry, competition}

{cost, operation, labor}

Oil and natural gas prices are volatile, and low prices could have a material adverse impact on our business. Assets we acquire may prove to be worth less than we paid because of uncertainties in evaluating recoverable reserves and potential liabilities. Estimates of oil and gas reserves are uncertain and any material inaccuracies in these reserve estimates will materially affect the quantities and the value of our reserves. We intend to fund our development, acquisition and exploitation activities in part through additional debt financing. A higher level of debt could negatively impact our financial condition, results of operations and business prospects. The operation of our wells may not be profitable or achieve our targeted returns. Current levels of production are inadequate to support the operations of the Company and permit a profit We depend substantially on the continued presence of key personnel for critical management decisions and industry contacts. The unavailability or high cost of drilling rigs, equipment, supplies, personnel and oil field services could adversely affect our ability to execute our exploration and development plans on a timely basis and within our budget. The marketability of our oil and gas production depends on services and facilities that we typically do not own or control. The failure or inaccessibility of any such services or facilities could result in a curtailment of production and revenues. Our business is highly competitive. Our oil and gas activities are subject to various risks which are beyond our control. We cannot be certain that the insurance coverage maintained by us will be adequate to cover all losses that may be sustained in connection with all oil and gas activities.

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1101661--8/13/2008--SONORAN_ENERGY_INC