MARATHON OIL CORPORATION Executive Overview Outlook Operations Market Conditions Results of Operations Critical Accounting Estimates Accounting Standards Not Yet Adopted Cash Flows Liquidity and Capital Resources Environmental Matters and Other Contingencies
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the preceding consolidated financial statements and notes in Item 1 .
Executive Overview
We are an independent exploration and production company, focused onU.S. resource plays:Eagle Ford inTexas , Bakken inNorth Dakota , STACK and SCOOP inOklahoma andNorthern Delaware inNew Mexico . OurU.S. assets are complemented by our international operations in E.G. Our overall business strategy is to responsibly deliver competitive corporate return levels, free cash flow and cash returns to shareholders, all of which are sustainable and resilient through long-term commodity price cycles. We expect to achieve our business strategy by adherence to a disciplined reinvestment rate capital allocation framework that limits our capital expenditures relative to our expected cash flow from operations. Keeping our workforce safe, maintaining a strong balance sheet, responsibly meeting global energy demand with a focus on continuously improving environmental performance, serving as a trusted partner in our local communities and maintaining best in-class corporate governance standards are foundational to the execution of our strategy. Compared to the prior year's quarter, we experienced a significant increase in revenues, income from operations and operating cash flow, all of which were driven by higher commodity prices. Total company net sales volumes were roughly flat, with an increase inU.S. net sales volumes offset by a corresponding decline in International net sales volumes. Our cash generated from operations more than funded our capital program, dividend payments and share repurchases. These results and activities are consistent with our prioritization of free cash flow generation and adherence to our disciplined capital allocation framework. Below are certain key financial and operational highlights for the quarter:
Improved financial results
•Our net income was$1.3 billion in the first quarter of 2022 as compared to net income of$97 million in the same period last year. Included in our financial results for the current quarter:
•Revenues from contracts with customers increased
•Income from equity method investments of
•Non-cash tax benefit of
Maintained investment grade balance sheet, increased return of capital to investors
•All three primary credit rating agencies continue to rate us as investment grade.
•As of
•Repurchased
•Paid
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Capital Budget
In our 2021 Form 10-K filed inFebruary 2022 , we disclosed a 2022 capital budget of$1.2 billion based on assumed hydrocarbon prices of$80 /bbl for WTI and$4 /mmbtu forHenry Hub gas, which were indicative of market conditions at that time. In a pricing environment of$100 /bbl for WTI and$6 /mmbtu forHenry Hub gas, we expect our capital budget to reflect an inflationary increase to$1.3 billion .
Operations
The following table presents a summary of our sales volumes for each of our
segments. Refer to Results of Operations for a price-volume analysis for
each of the segments.
Three Months Ended March 31,
Net Sales Volumes 2022 2021 Increase (Decrease)
United States (mboed) 280 275 2 %
International (mboed) 61 66 (8) %
Total (mboed) 341 341 - %
United States
Net sales volumes in the segment were higher in the first quarter of 2022 as
compared to the first quarter of 2021 due to increased capital investment and
timing of wells to sales, partially offset by natural decline.
The following tables provide additional details regarding net sales volumes,
sales mix and operational drilling activity for our significant operations
within this segment:
Three Months Ended March 31,
Net Sales Volumes 2022 2021 Increase (Decrease)
Equivalent Barrels (mboed)
Eagle Ford 80 77 4 %
Bakken 118 112 5 %
Oklahoma 51 53 (4) %
Northern Delaware 20 25 (20) %
Other United States 11 8 38 %
Total United States 280 275 2 %
Three Months Ended March 31, 2022
Sales Mix - U.S. Resource Plays Eagle Ford Bakken Oklahoma Northern Delaware Total
Crude oil and condensate 66 % 65 % 23 % 53 % 57 %
Natural gas liquids 17 % 22 % 34 % 22 % 23 %
Natural gas 17 % 13 % 43 % 25 % 20 %
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Three Months Ended March 31,
Drilling Activity - U.S. Resource Plays 2022 2021
Gross Operated
Eagle Ford:
Wells drilled to total depth 29 30
Wells brought to sales 28 25
Bakken:
Wells drilled to total depth 14 22
Wells brought to sales 20 3
Oklahoma:
Wells drilled to total depth 3 -
Wells brought to sales 9 -
Northern Delaware:
Wells drilled to total depth - -
Wells brought to sales - -
International
Net sales volumes were lower in the first quarter of 2022 as compared to the first quarter of 2021 primarily due to natural decline. The following table provides details regarding net sales volumes for our operations within this segment:
Three Months Ended
Increase
Net Sales Volumes 2022 2021 (Decrease)
Equivalent Barrels (mboed)
Equatorial Guinea 61 66 (8) %
Equity Method Investees
LNG (mtd) 3,489 3,766 (7) %
Methanol (mtd) 982 1,092 (10) %
Condensate and LPG (boed) 6,914 10,730 (36) %
Market Conditions
Commodity prices are the most significant factor impacting our revenues,
profitability, operating cash flows, the amount of capital we invest in our
business, redemption of our debt, payment of dividends and funding of share
repurchases. Beginning in December 2020 and continuing through the first quarter
of 2022, commodity prices continued to increase due to rising oil demand as
global economic activity increased. Higher commodity prices were also supported
by ongoing OPEC petroleum supply limitations, conflicts and economic sanctions
involving producer countries. We continue to expect commodity price volatility
given the global dynamics of supply and demand that exist in the market,
including geopolitical events. Refer to Item 1A. Risk Factors in our 2021 Annual
Report on Form 10-K for further discussion on how volatility in commodity prices
could impact us.
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The following table presents our average price realizations and the related
benchmarks for crude oil and condensate, NGLs and natural gas for the first
quarter of 2022 and 2021.
Three Months Ended March 31,
Increase
2022 2021 (Decrease)
Average Price Realizations(a)
Crude oil and condensate (per bbl)(b) $ 94.43 $ 55.38 71 %
Natural gas liquids (per bbl)(c) 37.32 23.94 56 %
Natural gas (per mcf)(d) 4.79 6.31 (24) %
Benchmarks
WTI crude oil average of daily prices (per bbl)$ 95.01 $ 58.14 63 %
Magellan
96.67 59.31 63 %
Mont Belvieu NGLs (per bbl)(e) 38.24 23.98 59 %
2.69 84 %
(a)Excludes gains or losses on commodity derivative instruments.
(b)Inclusion of realized gains (losses) on crude oil derivative instruments
would have decreased average price realizations by $2.00 per bbl and $4.61 per
bbl for the first quarter 2022 and 2021, respectively.
(c)Inclusion of realized gains (losses) on NGL derivative instruments would have
no impact for the first quarter 2022 and would have decreased average price
realizations by $1.34 per bbl for the first quarter 2021.
(d)Inclusion of realized gains (losses) on natural gas derivative instruments
would have minimal impact on average price realizations for the first quarter
2022 and 2021.
(e)Bloomberg Finance LLP : Y-grade Mix NGL of 55% ethane, 25% propane, 5% butane,
8% isobutane and 7% natural gasoline.
Crude oil and condensate - Price realizations may differ from benchmarks due to the quality and location of the product.
Natural gas liquids - The majority of our sales volumes are sold at reference to
Natural gas - A significant portion of our volumes are sold at bid-week prices, or first-of-month indices relative to our producing areas.
International (E.G.)
The following table presents our average price realizations and the related benchmark for crude oil for the first quarter of 2022 and 2021.
Three Months Ended
Increase
2022 2021 (Decrease)
Average Price Realizations
Crude oil and condensate (per bbl) $ 59.63 $ 44.13 35 %
Natural gas liquids (per bbl) 1.00 1.00 - %
Natural gas (per mcf) 0.24 0.24 - %
Benchmark
Brent (Europe) crude oil (per bbl)(a)$ 100.30 $ 60.82 65 %
(a)Average of monthly prices obtained from the
Crude oil and condensate - Alba field liquids production is primarily condensate.MEGPL and Marathon E.G. International Limited generally sell their share of condensate in relation to the Brent crude benchmark.Alba Plant LLC processes the rich hydrocarbon gas which is supplied by the Alba field under a fixed-price long term contract.Alba Plant LLC extracts NGLs and secondary condensate which is then sold byAlba Plant LLC at market prices, with our share of the revenue reflected in income from equity method investments on the consolidated statements of income.Alba Plant LLC delivers the processed dry natural gas to the Alba Unit Parties for distribution and sale to AMPCO and EG LNG. 26 -------------------------------------------------------------------------------- Natural gas liquids - Wet gas is sold toAlba Plant LLC at a fixed-price long term contract resulting in realized prices not tracking market price.Alba Plant LLC extracts and keeps NGLs, which are sold at market price, with our share of income fromAlba Plant LLC being reflected in the income from equity method investments on the consolidated statements of income. Natural gas - Dry natural gas, processed byAlba Plant LLC on behalf of the Alba Unit Parties is sold by the Alba field to EG LNG and AMPCO at fixed-price long term contracts resulting in realized prices not tracking market price. We derive additional value from the equity investment in our downstream gas processing units EG LNG and AMPCO. EG LNG sells LNG on a market-based long term contract and AMPCO markets methanol at market prices.Alba Plant LLC and EG LNG process third party gas under a combination of tolling and a market linked profit-sharing arrangement, the benefits of which are included in our respective share of income from equity method investees.
Results of Operations
Three Months Ended
Revenues from contracts with customers are presented by segment in the table
below:
Three Months Ended March 31,
(In millions) 2022 2021
Revenues from contracts with customers
United States $ 1,714 $ 1,132
International 47 45
Segment revenues from contracts with customers $
1,761
Below is a price/volume analysis for each segment. Refer to the preceding
Operations and Market Conditions sections for additional detail related to our net sales volumes and average price realizations.
Increase (Decrease) Related to
Three Months Ended Three Months Ended
(In millions) March 31, 2021 Price Realizations Net Sales Volumes March 31, 2022
United States Price/Volume Analysis
Crude oil and condensate $ 791 $ 555 $ (5) $ 1,341
Natural gas liquids 116 77 23 216
Natural gas 215 (48) (16) 151
Other sales 10 6
Total $ 1,132 $ 1,714
International Price/Volume Analysis
Crude oil and condensate $ 37 $ 10 $ (7) $ 40
Natural gas liquids 1 - - 1
Natural gas 7 (1) (1) 5
Other sales - 1
Total $ 45 $ 47
Net gain (loss) on commodity derivatives in the first quarter of 2022, was a
loss of $143 million , compared to a net loss of $153 million for the same period
in 2021. We have multiple crude oil, natural gas and NGL derivative contracts
that settle against various indices. We record commodity derivative gains/losses
as the index pricing and forward curves change each period. See Note 13 to
the consolidated financial statements for further information.
Income from equity method investments increased
Production expenses increased
The following table provides production expense and production expense rates (expense per boe) for each segment:
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Three Months Ended
Increase Increase
($ in millions; rate in $ per boe) 2022 2021 (Decrease) 2022 2021 (Decrease)
Production Expense and Rate Expense Rate
United States $ 141 $ 111 27 % $ 5.59 $ 4.46 25 %
International $ 11 $ 10 10 % $ 1.92 $ 1.68 14 %
Shipping, handling and other operating increased $33 million in the first
quarter of 2022 versus the same period in 2021. As disclosed in our Form 10-K,
certain of our processing arrangements with midstream entities are
percentage-of-proceeds contracts. We classify the proceeds retained by the
midstream companies as shipping and handling costs. The increase in shipping and
handling costs of these percentage-of-proceeds contracts coincides with the
increase in realized natural gas liquids prices.
Exploration expenses include unproved property impairments, dry well costs, geological and geophysical and other costs.
The following table summarizes the components of exploration expenses:
Three Months Ended
Increase
(In millions) 2022 2021 (Decrease)
Exploration Expenses
Unproved property impairments $ 8 $ 15 (47) %
Dry well costs - 2 (100) %
Geological and geophysical - 2 (100) %
Other 3 2 50 %
Total exploration expenses $ 11 $ 21 (48) %
Depreciation, depletion and amortization decreased
Our segments apply the units-of-production method to the majority of assets,
including capitalized asset retirement costs; therefore, volumes have an impact
on DD&A expense. The following table provides DD&A expense and DD&A expense
rates for each segment:
Three Months Ended
Increase Increase
($ in millions; rate in $ per boe) 2022 2021 (Decrease) 2022 2021 (Decrease)
DD&A Expense and Rate Expense Rate
United States $ 404 $ 472 (14) % $ 16.02 $ 19.05 (16) %
International $ 15 $ 19 (21) % $ 2.80 $ 3.09 (9) %
Taxes other than income include production, severance and ad valorem taxes,
primarily in the U.S. , which tend to increase or decrease in relation to revenue
and sales volumes. Taxes other than income increased $30 million primarily due
to higher price realizations in the U.S. segment in the first quarter of 2022.
General and administrative expenses decreased $16 million in the first quarter
of 2022 primarily due to expenses incurred in the first quarter of 2021 related
to termination of an aircraft lease agreement.
Provision (benefit) for income taxes for the current quarter includes a tax
benefit of $685 million arising from the partial release of a valuation
allowance on certain U.S. and state deferred tax assets. Partially offsetting
this benefit is a provision related to current year income earned by our
operations. See Note 6 to the consolidated financial statements for a more
detailed discussion concerning the tax valuation allowance and changes in the
effective tax rate.
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Segment income represents income which excludes certain items not allocated to our operating segments, net of income taxes. A portion of our corporate and operations general and administrative support costs are not allocated to the operating segments. These unallocated costs primarily consist of employment costs (including pension effects), professional services, facilities and other costs associated with corporate and operations support activities. Additionally, items which affect comparability such as: gains or losses on dispositions, impairments of proved and certain unproved properties and equity method investments, changes in our valuation allowance, unrealized gains or losses on commodity and interest rate derivative instruments, effects of pension settlements and curtailments or other items (as determined by the CODM) are not allocated to operating segments.
The following table reconciles segment income (loss) to net income (loss):
Three Months Ended March 31,
(In millions) 2022 2021
United States $ 661 $ 212
International 115 50
Segment income (loss) 776 262
Items not allocated to segments, net of income taxes 528 (165)
Net income (loss) $ 1,304 $ 97
United States segment income (loss) in the first quarter of 2022 was $661
million of income versus a $212 million income for the same period in 2021. The
increase in income was primarily due to higher price realizations and lower DD&A
expenses. These favorable changes were partially offset by higher income taxes
and production taxes in the first quarter of 2022.
International segment income (loss) in the first quarter of 2022 was
Critical Accounting Estimates
Other than the item set forth below, there have been no material changes or developments in the evaluation of the accounting estimates and the underlying assumptions or methodologies pertaining to our Critical Accounting Estimates disclosed in our Form 10-K for the year endedDecember 31, 2021 .
Income Taxes
We have recorded deferred tax assets and liabilities, measured at enacted tax rates, for temporary differences between book basis and tax basis, tax credit carryforwards and operating loss carryforwards. In accordance withU.S. GAAP, we routinely assess the realizability of our deferred tax assets and reduce such assets to the expected realizable amount, by a valuation allowance if it is more likely than not that some portion or all of the deferred tax assets will not be realized. In assessing the need for additional or adjustments to existing valuation allowances, we consider all available positive and negative evidence. Positive evidence includes reversals of temporary differences, forecasts of future taxable income, assessment of future business assumptions and applicable tax planning strategies that are prudent and feasible. Negative evidence includes losses in recent years as well as the forecasts of future losses in the realizable period. In making our assessment regarding valuation allowances, we weight the evidence based on objectivity. We base our future taxable income estimates on projected financial information which we believe to be reasonably likely to occur. Numerous judgments and assumptions are inherent in the estimation of future taxable income, including factors such as future operating conditions and the assessment of the effects of foreign taxes on ourU.S. federal income taxes. Future operating conditions can be affected by numerous factors, including (i) future crude oil and condensate, NGLs and natural gas prices, (ii) estimated quantities of crude oil and condensate, NGLs and natural gas, (iii) expected timing of production, and (iv) future capital requirements. An estimate of the sensitivity to changes in assumptions resulting in future taxable income calculations is not practicable, given the numerous assumptions that can materially affect our estimates. Unfavorable adjustments to some of the above listed assumptions would likely be offset by favorable adjustments in other assumptions. For example, the impact of sustained reduced commodity prices on future taxable income would likely be partially offset by lower capital expenditures. Based on the assumptions and judgments described above, during the first quarter of 2022, we re-evaluated the realizability ofU.S. and state deferred tax assets and determined that a valuation allowance against certain deferred tax assets was no longer necessary. As such, we recorded a non-cash deferred tax benefit in the first quarter of 2022 for$685 million . See Note 6 to the consolidated financial statements for further detail. 29 --------------------------------------------------------------------------------
Accounting Standards Not Yet Adopted
See Note 2 to the consolidated financial statements.
Cash Flows
Commodity prices are the most significant factor impacting our revenues,
profitability, operating cash flows, the amount of capital we invest in our
business, principal debt repayments, payment of dividends and funding of share
repurchases. We generated significant positive cash flow from operations during
the first three months of 2022 given the recent commodity price cycle. We
continue to expect volatility in commodity prices and that could impact how much
cash flow from operations we generate. The following table presents sources and
uses of cash and cash equivalents:
Three Months Ended March 31,
(In millions) 2022 2021
Sources of cash and cash equivalents
Operating activities $
1,067
Disposal of assets, net of cash transferred to the buyer 2 3 Other 29 - Total sources of cash and cash equivalents $ 1,098$ 625 Uses of cash and cash equivalents Additions to property, plant and equipment $
(332)
Shares repurchased under buyback programs (592) - Dividends paid (52) (23) Purchases of shares for tax withholding obligations (21) (9) Other - (1) Total uses of cash and cash equivalents $
(997)
Cash flows generated from operating activities in the first three months of 2022
were 72% higher compared to the same period in 2021, primarily as a result of
higher realized commodity prices, partially offset by increased working capital
usage.
The following table shows capital expenditures by segment and reconciles to
additions to property, plant and equipment as presented in the consolidated
statements of cash flows:
Three Months Ended March 31,
(In millions) 2022 2021
United States $ 346 $ 183
International (1) -
Corporate 3 1
Total capital expenditures (accrued) 348 184
Change in capital expenditure accrual (16) 25
Total use of cash and cash equivalents for property, plant and equipment
$
332
The increase in our capital expenditures for the
Liquidity and Capital Resources
Capital Resources and Available Liquidity
Our main sources of liquidity are cash and cash equivalents, internally generated cash flow from operations, sales of non-core assets, capital market transactions and our revolving Credit Facility. AtMarch 31, 2022 , we had approximately$3.8 billion of liquidity consisting of$681 million in cash and cash equivalents and$3.1 billion available under our revolving Credit Facility. 30 -------------------------------------------------------------------------------- Our working capital requirements are supported by our cash and cash equivalents and our Credit Facility. We may draw on our revolving Credit Facility to meet short-term cash requirements or issue debt or equity securities through the shelf registration statement discussed below as part of our longer-term liquidity and capital management program. Because of the alternatives available to us as discussed above, we believe that our short-term and long-term liquidity are adequate to fund not only our current operations, but also our near-term and long-term funding requirements including our capital spending programs, defined benefit plan contributions, repayment of debt maturities, dividends and other amounts that may ultimately be paid in connection with contingencies. General economic conditions, commodity prices, and financial, business and other factors, including the global pandemic, could affect our operations and our ability to access the capital markets. We continue to be rated investment grade at all three primary credit rating agencies. A downgrade in our credit ratings could increase our future cost of financing or limit our ability to access capital and could result in additional credit support requirements. We do not have any triggers on any of our corporate debt that would cause an event of default in the case of a downgrade of our credit ratings. See Item 1A. Risk Factors in our Annual Report on Form 10-K for the year endedDecember 31, 2021 for a discussion of how a downgrade in our credit ratings could affect us.
Credit Arrangements and Borrowings
Our Credit Facility includes a covenant requiring that our total debt to total capitalization ratio not exceed 65% as of the last day of the fiscal quarter. Our ratio was 20% at bothMarch 31, 2022 andDecember 31, 2021 . See Note 15 to the consolidated financial statements for further information. AtMarch 31, 2022 , we had no borrowings on our$3.1 billion Credit Facility and$4.0 billion of total long-term debt outstanding. Our next significant long-term debt maturity is in the amount of$1.0 billion due 2027. Refer to our 2021 Annual Report on Form 10-K for a listing of our long-term debt maturities.
Shelf Registration
We have a universal shelf registration statement filed with theSEC under which we, as a "well-known seasoned issuer" for purposes ofSEC rules, have the ability to issue and sell an indeterminate amount of various types of debt and equity securities. Capital Requirements Share Repurchase Program During the first three months of 2022, we repurchased approximately$592 million of shares of our common stock. The total remaining share repurchase authorization was approximately$1.4 billion atMarch 31, 2022 . Additionally, we repurchased$21 million of shares during the first three months of 2022 related to our tax withholding obligations associated with the vesting of employee restricted stock awards and restricted stock units; these repurchases do not impact our share repurchase program authorization. Subsequent to the quarter, we repurchased approximately$282 million of shares of our common stock throughMay 4, 2022 . EffectiveMay 4, 2022 , our Board of Directors increased our remaining share repurchase program authorization to$2.5 billion .
Dividends
OnApril 28, 2022 , our Board of Directors approved a dividend of$0.08 per share payableJune 10, 2022 to stockholders of record at the close of business onMay 18, 2022 .
Other Contractual Cash Obligations
As ofMarch 31, 2022 , there are no material changes to our consolidated cash obligations to make future payments under existing contracts, as disclosed in our 2021 Annual Report on Form 10-K.
Environmental Matters and Other Contingencies
We have incurred and will continue to incur capital, operating and maintenance
and remediation expenditures as a result of environmental laws and regulations.
If these expenditures, as with all costs, are not ultimately offset by the
prices we receive for our products and services, our operating results will be
adversely affected. We believe that substantially all of our competitors must
comply with similar environmental laws and regulations. However, the specific
impact on each competitor may vary depending on a number of factors, including
the age and location of its operating facilities, marketing areas and production
processes. These laws generally provide for control of pollutants released into
the environment and require responsible parties to undertake remediation of
hazardous waste disposal sites. Penalties may be imposed for noncompliance.
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Other than the items set forth in Part II - Item 1. Legal Proceedings , there
have been no significant changes to the environmental, health and safety matters
under Item 1. Business or Item 3. Legal Proceedings in our 2021 Annual Report on
Form 10-K. See Note 22 to the consolidated financial statements for a
description of other contingencies.
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This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"). All statements, other than statements of historical fact, including without limitation statements regarding our future performance, business strategy, 2022 capital budget, reserve estimates, asset quality, production guidance, drilling plans, capital plans, future debt retirement, cost and expense estimates, asset acquisitions and dispositions, tax allowances, future financial position and other plans and objectives for future cash flow from operations, are forward-looking statements. Words such as "anticipate," "believe," "continue," "could," "estimate," "expect," "forecast," "future," "guidance," "intend," "may," "outlook," "plan," "positioned," "project," "seek," "should," "target," "will," "would" or similar words may be used to identify forward-looking statements; however, the absence of these words does not mean that the statements are not forward-looking. While we believe our assumptions concerning future events are reasonable, a number of factors could cause results to differ materially from those projected, including, but not limited to:
•conditions in the oil and gas industry, including supply and demand levels for crude oil and condensate, NGLs and natural gas and the resulting impact on price;
•changes in expected reserve or production levels;
•changes in political and economic conditions in theU.S. and E.G., including changes in foreign currency exchange rates, interest rates, inflation rates and global and domestic market conditions;
•actions taken by the members of
•risks related to our hedging activities;
•voluntary and involuntary curtailments, delays or cancellations of certain drilling activities;
•well production timing;
•liabilities or corrective actions resulting from litigation, other proceedings and investigations or alleged violations of law or permits;
•capital available for exploration and development;
•the inability of any party to satisfy closing conditions or delays in execution with respect to our asset acquisitions and dispositions;
•drilling and operating risks;
•lack of, or disruption in, access to storage capacity, pipelines or other transportation methods;
•well production timing;
•availability of drilling rigs, materials and labor, including the costs associated therewith;
•difficulty in obtaining necessary approvals and permits;
•the availability, cost, terms and timing of issuance or execution of, competition for, and challenges to, mineral licenses and leases and governmental and other permits and rights-of-way, and our ability to retain mineral licenses and leases;
•non-performance by third parties of their contractual or legal obligations, including due to bankruptcy;
•unexpected events that may impact distributions from our equity method investees;
•changes in our credit ratings;
•hazards such as weather conditions, a health pandemic (including COVID-19), acts of war or terrorist acts and the governmental or military response thereto;
•shortages of key personnel, including employees, contractors and subcontractors;
•security threats, including cybersecurity threats and disruptions to our business and operations from breaches of our information technology systems, or breaches of the information technology systems, facilities and infrastructure of third parties with which we transact business;
•changes in safety, health, environmental, tax and other regulations or requirements or initiatives including those addressing the impact of global climate change, air emissions or water management;
•other geological, operating and economic considerations; and
•the risk factors, forward-looking statements and challenges and uncertainties described in our 2021 Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other filings with theSEC . All forward-looking statements included in this report are based on information available to us on the date of this report. Except as required by law, we undertake no obligation to revise or update any forward-looking statements as a result of new information, future events or otherwise. 33
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