b'For example, in new development projects available data may not allow us to completely know theextent of the reservoir or choose the best locations for drilling development wells. A development wellwe drill may be a dry hole or result in noncommercial quantities of hydrocarbons. All costs ofdevelopment drilling and other development activities are capitalized, even if the activities do not resultin commercially productive quantities of hydrocarbon reserves. This puts a property at higher risk forfuture impairment if commodity prices decrease or operating or development costs increase.Our identified drilling and infrastructure locations are scheduled out over time, making them susceptible touncertainties that could materially alter the occurrence or timing of their drilling or infrastructure installationor modification.Our management team has identified and scheduled drilling locations and possible infrastructurelocations on our license and lease areas over a multi-year period. Our ability to drill and develop theselocations depends on a number of factors, including the availability of equipment and capital, approvalby block or lease partners and national and state regulators, seasonal conditions, oil prices, assessmentof risks, costs and drilling results. For example, a shutdown of the U.S. federal government could delaythe regulatory review and approval process associated with drilling or developmental activities withinour license areas in the U.S. Gulf of Mexico. The final determination on whether to drill or developany of these locations will be dependent upon the factors described elsewhere in this report as well as,to some degree, the results of our drilling and production activities with respect to our established wellsand drilling locations. Because of these uncertainties, we do not know if the drilling locations we haveidentified will be drilled or infrastructure installed or modified within our expected timeframe or at allor if we will be able to economically produce hydrocarbons from these or any other potential drillinglocations. As such, our actual drilling and development activities may be materially different from ourcurrent expectations, which could adversely affect our results of operations and financial condition.A substantial or extended decline in both global and local oil and natural gas prices may adversely affect ourbusiness, financial condition and results of operations.The prices that we will receive for our oil and natural gas will significantly affect our revenue,profitability, access to capital and future growth rate. Historically, the oil and natural gas markets havebeen volatile and will likely continue to be volatile in the future. Oil prices experienced significant andsustained declines in the past few years and will likely continue to be volatile in the future. The pricesthat we will receive for our production and the levels of our production depend on numerous factors.These factors include, but are not limited to, the following:\x7f changes in supply and demand for oil and natural gas;\x7f the actions of the Organization of the Petroleum Exporting Countries;\x7f speculation as to the future price of oil and natural gas and the speculative trading of oil andnatural gas futures contracts;\x7f global economic conditions;\x7f political and economic conditions, including embargoes in oil-producing countries or affectingother oil-producing activities, particularly in the Middle East, Africa, Russia and Central andSouth America;\x7f the continued threat of terrorism and the impact of military and other action, including U.S.military operations in the Middle East;\x7f the level of global oil and natural gas exploration and production activity;\x7f the level of global oil inventories and oil refining capacities;44'