b'We operate in a litigious environment.Some of the jurisdictions within which we operate have proven to be litigious environments. Oiland gas companies, such as us, can be involved in various legal proceedings, such as title or contractualdisputes, in the ordinary course of business.From time to time, we may become involved in various legal and regulatory proceedings arising inthe normal course of business. We cannot predict the occurrence or outcome of these proceedings withcertainty, and if we are unsuccessful in these disputes and any loss exceeds our available insurance, thiscould have a material adverse effect on our results of operations.Because we maintain a diversified portfolio of assets overseas, the complexity and types of legalprocedures with which we may become involved may vary, and we could incur significant legal andsupport expenses in different jurisdictions. If we are not able to successfully defend ourselves, therecould be a delay or even halt in our exploration, development or production activities or other businessplans, resulting in a reduction in reserves, loss of production and reduced cash flows. Legal proceedingscould result in a substantial liability and/or negative publicity about us and adversely affect the price ofour common stock. In addition, legal proceedings distract management and other personnel from theirprimary responsibilities.We face various risks associated with global populism.Globally, certain individuals and organizations are attempting to focus public attention on incomedistribution, wealth distribution, and corporate taxation levels, and implement income and wealthredistribution policies. These efforts, if they gain political traction, could result in increased taxation onindividuals and/or corporations, as well as, potentially, increased regulation on companies and financialinstitutions. Our need to incur costs associated with responding to these developments or complyingwith any resulting new legal or regulatory requirements, as well as any potential increased tax expense,could increase our costs of doing business, reduce our financial flexibility and otherwise have a materialadverse effect on our business, financial condition and results of our operations.Slower global economic growth rates may materially adversely impact our operating results and financialposition.Market volatility and reduced consumer demand may increase economic uncertainty. Manydeveloped countries are constrained by long term structural government budget deficits andinternational financial markets and credit rating agencies are pressing for budgetary reform anddiscipline. This need for fiscal discipline is balanced by calls for continuing government stimulus andsocial spending as a result of the impacts of the global economic crisis. As major countries implementgovernment fiscal reform, such measures, if they are undertaken too rapidly, could further undermineeconomic recovery, reducing demand and slowing growth. Impacts of the crisis have spread to Chinaand other emerging markets, which have fueled global economic development in recent years, slowingtheir growth rates, reducing demand, and resulting in further drag on the global economy.Global economic growth drives demand for energy from all sources, including hydrocarbons.A lower future economic growth rate is likely to result in decreased demand growth for our crude oiland natural gas production. A decrease in demand, notwithstanding impacts from other factors, couldpotentially result in lower commodity prices, which would reduce our cash flows from operations, ourprofitability and our liquidity and financial position.Increased costs of capital could adversely affect our business.Our business and operating results can be harmed by factors such as the availability, terms andcost of capital, increases in interest rates or a reduction in credit rating. Changes in any one or more of61'