38079--3/1/2010--FOREST_OIL

related topics

{gas, price, oil}

{loss, insurance, financial}

{financial, litigation, operation}

{cost, regulation, environmental}

{debt, indebtedness, cash}

{operation, international, foreign}

{provision, law, control}

{acquisition, growth, future}

{competitive, industry, competition}

Oil and natural gas prices are volatile. Declines in commodity prices have adversely affected, and in the future may adversely affect, our financial condition and results of operations, cash flows, access to the capital markets, and ability to grow. We require substantial capital expenditures to conduct our operations, engage in acquisition activities, and replace our production, and we may be unable to obtain needed financing on satisfactory terms necessary to execute our operating strategy. We have substantial indebtedness and may incur more debt in the future. Our leverage may materially affect our operations and financial condition. Our use of hedging transactions could result in financial losses or reduce our income. Certain federal income tax deductions currently available with respect to oil and gas exploration and development may be eliminated as a result of future legislation. Lower oil and gas prices and other factors have resulted, and in the future may result, in ceiling test write-downs and other impairments of our asset carrying values. Our proved reserves are estimates and depend on many assumptions. Any material inaccuracies in these assumptions could cause the quantity and value of our oil and natural gas reserves, and our revenue, profitability, and cash flow, to be materially different from our estimates. Our failure to replace our reserves could result in a material decline in our reserves and production, which could adversely affect our financial condition. Drilling is a high-risk activity and may not result in commercially productive reserves. Competition within our industry is intense and may adversely affect our operations. Our growth depends partly on our ability to acquire oil and gas properties on a profitable basis. Our international operations may be adversely affected by currency fluctuations and economic and political developments. As part of our ongoing operations, we sometimes drill in new or emerging plays. As a result, our drilling in these areas is subject to greater risk and uncertainty. Our oil and gas operations are subject to various environmental and other governmental laws and regulations that materially affect our operations. The marketability of our production is dependent upon transportation and processing facilities over which we may have no control. We may not be insured against all of the operating risks to which our business is exposed. Our Restated Certificate of Incorporation and Bylaws have provisions that discourage corporate takeovers. We may face liabilities related to the pending bankruptcy of Pacific Energy Resources, Ltd.

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38079--3/1/2010--FOREST_OIL_CORP