1130464--3/16/2006--BLACK_HILLS_CORP

related topics

{condition, economic, financial}

{acquisition, growth, future}

{loss, insurance, financial}

{gas, price, oil}

{capital, credit, financial}

{cost, regulation, environmental}

{debt, indebtedness, cash}

{product, candidate, development}

{cost, contract, operation}

We must rely on cash distributions from our subsidiaries to make and maintain dividends and debt payments. There may be changes in the regulatory environment that restrict future dividends from our subsidiaries. We cannot assure you that our results from any acquisition will conform to our expectations. There may be additional risks associated with the operation of any new acquisition. Our agreements with counterparties that have experienced downgrades in their credit ratings expose us to the risk of counterparty default, which could adversely affect our cash flow and profitability. Our credit ratings could be lowered below investment grade in the future. If this were to occur, our access to capital and our cost of capital and other costs would be negatively affected. Geopolitical tensions may impair our ability to raise capital and limit our growth. Our utilities may not raise their retail rates without prior approval of the South Dakota Public Utilities Commission or the Wyoming Public Services Commission. If either utility seeks rate relief, it could experience delays in obtaining approvals and could have rate recovery disallowed in rate proceedings. Because prices for our products and services and other operating costs for our business are volatile, our revenues and expenses may fluctuate. Construction, expansion, refurbishment and operation of power generating and transmission and resource recovery facilities involve significant risks which could lead to lost revenues or increased expenses. Our power project development, expansion and acquisition activities may not be successful, which would impair our ability to execute our growth strategy. Estimates of the quantity and value of our proved oil and gas reserves may change materially due to numerous uncertainties inherent in estimating oil and natural gas reserves. Estimates of the quality and quantity of our coal reserves may change materially due to numerous uncertainties inherent in three dimensional structural modeling. Our business is subject to substantial governmental regulation and permitting requirements as well as on-site environmental liabilities we assumed when we acquired some of our facilities. We may be adversely affected by any future inability to comply with existing or future regulations or requirements or the potentially high cost of complying with such requirements. Ongoing changes in the United States utility industry, such as state and federal regulatory changes, a potential increase in the number of our competitors or the imposition of price limitations to address market volatility, could adversely affect our profitability.

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1130464--3/16/2006--BLACK_HILLS_CORP_/SD/