1125057--2/28/2008--ENCORE_ACQUISITION

related topics

{gas, price, oil}

{acquisition, growth, future}

{loss, insurance, financial}

{operation, natural, condition}

{debt, indebtedness, cash}

{competitive, industry, competition}

{cost, regulation, environmental}

{personnel, key, retain}

{loan, real, estate}

Oil and natural gas prices are very volatile. A decline in commodity prices could materially and adversely affect our financial condition, results of operations, and cash flows. An increase in the differential between the NYMEX or other benchmark prices of oil and natural gas and the wellhead price we receive could significantly affect our financial condition, results of operations, and cash flows. Our estimated proved reserves are based on many assumptions that may prove to be inaccurate. Any material inaccuracies in these reserve estimates or underlying assumptions will materially affect the quantities and present value of our reserves. Our oil and natural gas reserves naturally decline and the failure to replace our reserves could adversely affect our financial condition. The results of HPAI techniques are uncertain. Future price declines may result in a write-down of our asset carrying values, which could have a material adverse effect on our results of operations and limit our ability to borrow funds under our revolving credit facility. If we do not make acquisitions on economically acceptable terms, our future growth will be limited. The failure to properly manage growth through acquisitions could adversely affect our results of operations. Any acquisitions we complete are subject to substantial risks that would adversely affect our financial condition and results of operations. A substantial portion of our producing properties is located in one geographic area and adverse developments in any of our operating areas would negatively affect our financial condition and results of operations. Our commodity derivative contract activities could result in financial losses or could reduce our income. We have limited control over the activities on properties we do not operate. Our development and exploratory drilling efforts may not be profitable or achieve our targeted returns. Developing and producing oil and natural gas are costly and high-risk activities with many uncertainties that could adversely affect our financial condition or results of operations. Secondary and tertiary recovery techniques may not be successful, which could adversely affect our financial condition or results of operations. Our operations are subject to operational hazards and unforeseen interruptions for which we may not be adequately insured. Terrorist activities and the potential for military and other actions could adversely affect our business. Our development, exploitation, and exploration operations require substantial capital, and we may be unable to obtain needed financing on satisfactory terms. Shortages of rigs, equipment and crews could delay our operations and reduce our cash available for distribution. The loss of key personnel could adversely affect our business. Our business depends in part on gathering and transportation facilities owned by others. Any limitation in the availability of those facilities could interfere with our ability to market our oil and natural gas production and could harm our business. Competition in the oil and natural gas industry is intense, and many of our competitors have greater financial, technological, and other resources than we do. As a result, we may be unable to effectively compete with larger competitors. We are subject to complex federal, state, local, and other laws and regulations that could adversely affect the cost, manner or feasibility of conducting our operations. We have significant indebtedness and may incur significant additional indebtedness, which could negatively impact our financial condition, results of operations, and business prospects.

Full 10-K form ▸

1125057--2/28/2008--ENCORE_ACQUISITION_CO