62
●
Disruptions in our supply chain due in part to scrutiny
or embargoing of shipments from infected areas
or invocation of force majeure clauses in commercial
contracts due to restrictions imposed as a result
of the global response to the pandemic;
●
Failure of third parties on which we rely, including our suppliers, contract
manufacturers, contractors,
joint venture partners and external business partners,
to meet their obligations to the company, or
significant disruptions in their ability to
do so, which may be caused by their own financial
or
operational difficulties or restrictions imposed in
response to the disease outbreak;
●
Reduced workforce productivity caused by, but not limited to, illness, travel
restrictions, quarantine,
or government mandates;
●
Business interruptions resulting from a
significantportion of
amount of our
employees telecommutingworkforce continuing to telecommute,
incompliance with social distancing guidelines andshelter-in-place orders, as well as
thethe implementation
and maintenance of protections
for employees
continuingto commutecommuting for work, such as
personnel personnel screenings and self-quarantines before or
after
after travel;
and
●
Voluntary
or involuntary curtailments to support oil prices
or alleviate storage shortages for our
products.
Any of these factors, or other cascading effects of the
COVID-19 pandemic that are not currently foreseeable,
could materially increase our costs, negatively impact
our revenues and damage our financial condition,
results
of operations, cash flows and liquidity position.
The pandemic continues to progress and evolve,
and the full
extent and duration of any such impacts cannot
be predicted at this time because of the sweeping
impact of the
COVID-19 pandemic on daily life around the world.
We have been negatively affected and are likely to continue to be negatively affected by the recent
swift and
sharp drop in commodity prices.
The oil and gas business is fundamentally a commodity
business and prices for crude oil, bitumen,
natural gas,
NGLs and LNG can fluctuate widely depending
upon global events or conditions that affect supply and
demand.
Recently, there has been a precipitous decrease in demand for oil globally, largely caused by the
dramatic decrease in travel and commerce resulting
from the COVID-19 pandemic.
See Management’s
Discussion and Analysis of Financial Condition
and Results of Operations, for additional information
on
commodity prices and how we have been impacted.
There is no assurance of when or if commodity
prices will
return to pre-COVID-19 levels.
The speed and extent of any recovery remains uncertain
and is subject to
various risks, including the duration, impact and actions
taken to stem the proliferation of the COVID-19
pandemic, the extent to which those nations party
to the OPEC plus production agreement decide
to increase
production of crude oil, bitumen, natural gas
NGLsand
and LNG,NGLs and other risks described in this
Quarterly
QuarterlyReport on
Form 10-Q
or in our Annual Report
on Form 10-K for the
fiscal year ended
December 31, 2019.
Even after a recovery, our industry will continue to be exposed to the effects of changing
commodity prices
given the volatility in commodity price drivers
and
and the worldwide political and economic
environment
generally, as well as continued uncertainty caused by armed hostilities
in various oil-producing regions around
the globe.
Our revenues, operating results and future rate
of growth are highly dependent on the prices
we
receive for our crude oil, bitumen, natural gas, NGLs
and LNG.
Many of the factors influencing these prices
Lower crude oil, bitumen, natural gas, NGL and LNG
prices may have a material adverse effect on our
revenues,
operating income,earnings, cash flows and liquidity, and may also affect the amount
of dividends
of dividends we elect to
declaredeclare and pay on our common stock.
As a result of the
recentoil market downturn
weearlier
havethis year, we suspended our
shareshare repurchase program.
Lower prices may also limit the amount of reserves
we can produce economically,
thusthus adversely affecting our proved reserves, reserve replacement
ratio and accelerating the reduction in our