1402281--3/19/2008--Pacific_Asia_Petroleum

related topics

{acquisition, growth, future}

{stock, price, share}

{gas, price, oil}

{operation, international, foreign}

{control, financial, internal}

{competitive, industry, competition}

{regulation, change, law}

{product, candidate, development}

{financial, litigation, operation}

{interest, director, officer}

{operation, natural, condition}

{customer, product, revenue}

{stock, price, operating}

{cost, regulation, environmental}

{debt, indebtedness, cash}

{personnel, key, retain}

{capital, credit, financial}

{property, intellectual, protect}

{loss, insurance, financial}

Risk Related to the Company s Business The Company s limited operating history makes it difficult to predict future results and raises substantial doubt as to its ability to successfully develop profitable The Company s ability to diversify risks by participating in multiple projects and joint ventures depends upon its ability to raise capital and the availability of suitable prospects, and any failure to raise needed capital and secure suitable projects would negatively affect the Company s ability to The loss of key employees could adversely affect the Company s ability to The Company may not be able to raise the additional capital necessary to execute its business strategy, which could result in the curtailment or cessation of the Company s operations. Failure by the Company to generate sufficient cash flow from operations could eventually result in the cessation of the Company s operations and require the Company to seek outside financing or discontinue operations. The Company s failure to capitalize on its two existing definitive production agreements and/or consummate the transactions contemplated by the Chevron Agreements and/or enter into additional agreements would likely result in its inability to generate sufficient revenues and continue operations. The Company s oil and gas operations will involve many operating risks that can The Company is a development-stage company and expects to continue to incur losses for a significant period of time. The Company will be dependent upon others for the storage and transportation of oil and gas, which could significantly reduce its profitability. The Company may not be able to manage its anticipated growth, which could result in the disruption of the Company s operations and prevent the Company from generating An interruption in the supply of materials, resources and services the Company plans to obtain from third party sources could cause a decline in revenue. The Company does not plan to carry insurance policies in China and will be at risk of incurring personal injury claims for its employees and subcontractors, and incurring loss of business due to theft, accidents or natural disasters. Compliance with Section 404 of the Sarbanes-Oxley Act on a timely basis may strain the Company s limited financial and management resources, negatively affect its operating results, and cause the Company to fail to meet its reporting obligations. The Company is exposed to concentration of credit risk, which may result in losses in the future. Risks Related to the Company s Industry The Company may not be successful in finding petroleum resources or developing resources, and if it fails to do so, the Company will likely cease operations. The energy market in which the Company plans to operate is highly competitive and the Company may not be able to compete successfully against its current and future competitors, which could seriously harm the Company s business. The Company s business depends on the level of activity in the oil and gas industry, which is significantly affected by volatile energy prices, which volatility could adversely affect its ability to operate profitably. If the Company does not hedge its exposure to reductions in oil and gas prices, it may be subject to the risk of significant reductions in prices; alternatively, use by the Company of oil and gas price hedging contracts could limit future revenues The Company may be required to take non-cash asset write-downs if oil and natural gas prices decline, which could have a negative impact on the Company s Risks Related to Chinese and Other International Operations The Company s Chinese and other international operations will subject it to certain risks inherent in conducting business operations in China and other foreign countries, including political instability and foreign government regulation, which could significantly impact the Company s ability to operate in such countries and impact the Company s results of operations. Compliance and enforcement of environmental laws and regulations may cause the Company to incur significant expenditures and require resources, which it may A foreign government could change its policies toward private enterprise or even nationalize or expropriate private enterprises, which could result in the total loss of the Company s investment in that country. Because the Company plans to conduct substantially all of its business in China, fluctuations in exchange rates and restrictions on currency conversions could adversely affect the Company s results of operations and financial condition. If relations between the United States and China were to deteriorate, investors might be unwilling to hold or buy the Company s stock and its stock price may If the United States imposes trade sanctions on China due to its current currency policies, the Company s operations could be materially and adversely A lack of adequate remedies and impartiality under the Chinese legal system may adversely impact the Company s ability to do business and to enforce the agreements to which it is a party. The Company s stockholders may not be able to enforce United States civil Risks Related to the Company s Stock The market price of the Company s stock may be adversely affected by a number of factors related to the Company s performance, the performance of other energy-related companies and the stock market in general. The limited market for the Company s Common Stock may adversely affect trading prices or the ability of a shareholder to sell our shares in the public market at or near ask prices or at all if a shareholder needs to liquidate its shares. If the Company s Common Stock continues trading exclusively on the so-called Pink Sheets, it may be more difficult to effect transactions in the Company s Common Stock than if it were traded on the Over-the-Counter Bulletin Board or a securities exchange such as the AMEX. Substantial sales of the Company s Common Stock could cause the Company s stock price to fall. The Company s issuance of Preferred Stock could adversely affect the value of The Common Stock may be deemed penny stock and therefore subject to special requirements that could make the trading of the Company s Common Stock The Company s executive officers, directors and major stockholders hold a substantial amount of the Company s Common Stock and may be able to prevent other stockholders from

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1402281--3/19/2008--Pacific_Asia_Petroleum_Inc