Expand Energy (EXE) Risk Factor Changes

Our ability to develop natural gas, oil and NGL depends on the leases and other mineral rights we acquire and the rights of owners of nearby properties.

We are subject to taxation by various governmental authorities at the federal, state and local levels in the jurisdictions in which we do business.

There may be new regulation, disclosure-related and otherwise, with respect to sustainability matters, which will likely lead to increased compliance costs as well as scrutiny that could heighten all of the risks iden…

Separately, various regulators have adopted, or are considering adopting, regulations on environmental marketing claims or the prevention of greenwashing more generally, including, but not limited to the use of “ESG,”…

While we may at times engage in voluntary initiatives (such as voluntary disclosures, certifications or targets, among others) or commitments to improve our sustainability profile and/or products or to respond to stak…

Increasing attention to sustainability matters and our ability to achieve and maintain sustainability certifications, goals and commitments may impact our business, financial results or stock price.

As an owner, lessee or operator of gas and oil properties, we are subject to various federal, state, tribal and local laws and regulations relating to discharge of materials into, and protection of, the environment.

At the international level, the United Nations sponsored “Paris Agreement” requires member states to submit non-binding, individually determined reduction goals known as Nationally Determined Contributions every five…

In addition, several states in which we operate have imposed limitations designed to reduce methane emissions from gas and oil exploration and production activities.

Several states have adopted or are considering adopting regulations that could impose more stringent permitting, public disclosure and/or well construction requirements on hydraulic fracturing operations.

Pipeline Safety.

Our operations are subject to extensive federal, state, local and other laws, rules and regulations, including with respect to the environment, worker health and safety, wildlife conservation, the gathering and transp…

Failure to comply with the covenants and other restrictions could lead to an event of default and the acceleration of our obligations under our senior notes, credit facility or other financing agreements, and in the c…

As of December 31, 2025, we had indebtedness of approximately $5.0 billion, which included approximately $3.7 billion of Southwestern’s senior notes we assumed as a result of the Southwestern Merger during the year en…

We may be prevented from taking advantage of business opportunities that arise because of the limitations imposed on us by the restrictive covenants and financial covenants contained in our debt instruments.

Disruptions in the capital and credit markets, in particular with respect to the energy sector, could limit our ability to access these markets or may significantly increase our cost to borrow.

Military and other armed conflicts, terrorist attacks and the threat of both, whether domestic or foreign, could cause further instability in the global financial and energy markets.

Historically, concerns about global economic growth and international political stability have had a significant impact on global financial markets and commodity prices, including petroleum products.

access, delete and correct their personal information and opt-out of certain sales or transfers of personal information and provide for statutory fines and penalties for certain data security breaches or other CCPA an…

Along with our own data and information that we collect and retain in the normal course of our business, we and our business partners collect and retain significant volumes of certain other types of data, some of whic…

In the event of a cyber-attack, we may be required by federal and state laws or regulations to provide notification to regulators or individuals.

which may include disruptions to our drilling, completion, production and corporate functions.

We have been, and we and our customers, business partners, and counterparties may become, the subject of cyber-attacks on our and their internal IT and OT systems and through those of third parties.

We may also in the future enter into other commercial arrangements directly with foreign LNG customers.

As a domestic natural gas exploration and production company, we may be indirectly exposed to certain risks in the U.S.

environmental impacts, and the increasingly negative public perception regarding, and opposition to, the oil and gas industry, including major pipeline projects.

We have made significant investments in gathering and transportation assets and oilfield service businesses, including joint ventures in gas gathering pipelines, our drilling rigs, water infrastructure and pressure pu…

You should not assume that the present values included in this report represent the current market value of our estimated reserves.

As of December 31, 2025, approximately 28% of our estimated proved reserves (by volume) were undeveloped.

Our exploration, development and acquisition activities require substantial capital expenditures.

Our performance depends largely on the talents and efforts of highly skilled individuals and on our ability to attract new employees and to retain and motivate our existing employees.

•political instability or armed conflict in natural gas and oil producing regions, including in connection with the continued armed conflict between Russia and Ukraine, instability in the Middle East and Venezuela, an…

•changes in the level of consumer and industrial demand, including impacts from global or national health events and concerns;

jurisdictions and decisions from courts in other states that have addressed them, courts could resolve issues in ways that increase our liabilities or otherwise restrict or add costs to our operations.

The completion of the Southwestern Merger triggered an annual limitation on the utilization of our tax attributes, reducing our ability to offset future taxable income, which may result in an increase to income tax li…

The taxation of independent producers is subject to change, and changes in tax law could increase our cost of doing business.

frequency of allegations of “greenwashing” against companies making sustainability-related claims due to, among other things, allegations of incomplete, false or misleading disclosures, including with respect to the s…

Increasing attention to ESG matters and our ability to achieve and maintain ESG certifications, goals and commitments may impact our business, financial results or stock price.

penalties, as well as injunctions limiting operations in affected areas.

Costs to comply with environmental, health and safety regulations and initiatives can be significant.

In addition, several states in which we operate have imposed limitations designed to reduce methane emissions from gas and oil exploration and production activities.

Climate Change and Regulation of Methane and Other Greenhouse Gas Emissions.

Several states have adopted or are considering adopting regulations that could impose more stringent permitting, public disclosure and/or well construction requirements on hydraulic fracturing operations.

per metric ton emitted over permitted methane emissions thresholds, and increases to $1,200 for 2025 reported amounts, and $1,500 for 2026 reported amounts.

In addition, changes in public policy have affected, and in the future could further affect, our operations.

We are subject to extensive governmental regulation, which can change and could adversely impact our business.

Following the Southwestern Merger, the size of our business increased significantly.

The Company’s operating results following the Southwestern Merger will suffer if we do not effectively manage our expanded operations.

Upon completion of the Southwestern Merger, legacy Southwestern shareholders became shareholders of the Company.

The market price for our common stock as a result of the Southwestern Merger may be affected by factors different from those that historically have affected our common stock.

We believe that, once the business of Southwestern is fully integrated into the Company, the Southwestern Merger will provide operational and financial scale, increasing free cash flow and an enhanced corporate rate o…

As a result of the Southwestern Merger, the size of the Company’s business has increased significantly.

•potential unknown liabilities and unforeseen increased expenses or delays following the Southwestern Merger.

•the assumption of contractual obligations with less favorable or more restrictive terms; and

•complexities associated with managing the combined businesses, including difficulty addressing possible differences in operational philosophies and the challenge of integrating complex systems, technology, networks a…

•the inability to successfully combine the business of the Company and Southwestern in a manner that permits us to achieve, on a timely basis, or at all, the enhanced revenue opportunities and cost savings and other b…

The Southwestern Merger involved the combination of two companies that previously operated as independent public companies until October 1, 2024.

Failure to successfully integrate the business of the Company and Southwestern or realize the anticipated benefits of the Southwestern Merger may adversely affect our future results and financial condition.

Failure to comply with the covenants and other restrictions could lead to an event of default and the acceleration of our obligations under our senior notes, credit facility or other financing agreements, and in the c…

Restrictive covenants in certain of our existing and future debt instruments may limit our ability to finance our operations, fund our capital needs, respond to changing conditions and engage in other business activit…

We have significant capital needs, and our ability to access the capital and credit markets to raise capital on favorable terms is limited by industry conditions.

Historically, concerns about global economic growth and international political stability have had a significant impact on global financial markets and commodity prices, including petroleum products.

A deterioration in general economic, political, business or industry conditions would have a material adverse effect on our results of operations, liquidity and financial condition.

We collect, process, store and use personal information and other data, and our actual or perceived failure to protect such information and data or comply with data privacy and security laws and regulations could dama…

Cyber-attacks targeting systems and infrastructure used by the gas and oil industry and related regulations may adversely impact our operations and, if we or our third-party providers are unable to obtain and maintain…

Regional epidemics or pandemics and related economic turmoil, including supply chain constraints, have affected, and could in the future adversely affect our business, financial condition, results of operations and ca…

As a domestic natural gas exploration and production company, we may be indirectly exposed to certain risks in the U.S.

Our business strategy is increasingly focused on participating in the global LNG value chain, which is dependent, in part, on the growing U.S.

Our operations may be adversely affected by pipeline, trucking and gathering system capacity constraints and may be subject to interruptions that could adversely affect our cash flow.

Natural gas and oil operations are uncertain and involve substantial costs and risks.

Our commodity price risk management activities may limit the benefit we would receive from increases in commodity prices, may require us to provide collateral for derivative liabilities and involve risk that our count…

Certain of our undeveloped properties are subject to leases that will expire over the next several years unless production is established on units containing the acreage or the leases are renewed.

Our development and exploratory drilling efforts and our well operations may not be profitable or achieve our targeted returns.

The actual quantities of and future net revenues from our proved reserves may be less than our estimates.

If we are not able to replace reserves, we may not be able to sustain production.

Significant capital expenditures are required to replace our reserves and conduct our business.

If commodity prices fall or drilling efforts are unsuccessful, we may be required to record write-downs of the carrying value of our natural gas and oil properties.

Risks related to potential acquisitions or dispositions may adversely affect our business.

The gas and oil exploration and production industry is very competitive; some of our competitors have greater financial and other resources than we do, and there is competition to attract and retain talent and competi…

Negative public perception regarding us or our industry could have an adverse effect on our operations.

Conservation measures and technological advances could reduce demand for natural gas and oil.

Natural gas, oil and NGL prices fluctuate widely, and lower prices for an extended period of time are likely to have a material adverse effect on our business.

•The Company’s operating results following the Southwestern Merger will suffer if we do not effectively manage our expanded operations.

•The market price of our common stock as a result of the Southwestern Merger may be affected by factors different from those that historically have affected our common stock.

•Failure to successfully integrate the business of the Company and Southwestern or realize the anticipated benefits of the Southwestern Merger may adversely affect our future results and financial condition.

Risks Related to the Company Following the Southwestern Merger

•Our ability to produce natural gas, oil and NGLs economically and in commercial quantities could be impaired if we are unable to acquire adequate supplies of water for our operations or are unable to dispose of or re…

The CAA, CWA and comparable state statutes provide for civil, criminal and administrative penalties for unauthorized discharges of oil and other pollutants and impose liability on parties responsible for those dischar…

uncertain at this time.

The Federal Water Pollution Control Act of 1972, or the Clean Water Act (the “CWA”), imposes restrictions and controls on the discharge of produced waters and other pollutants into waters of the United States (“WOTUS”).

The Clean Air Act (“CAA”) controls air emissions from oil and natural gas production and natural gas processing operations, among other sources.

migratory birds is prohibited.

The Endangered Species Act (“ESA”) seeks to ensure that activities do not jeopardize endangered or threatened animal, fish and plant species, nor destroy or modify the critical habitat of such species.

The Comprehensive Environmental, Response, Compensation, and Liability Act (“CERCLA”) and comparable state statutes impose strict, joint and several liability on several categories of persons, including current and fo…

The permits required for our operations may be subject to revocation, modification and renewal by issuing authorities.

•impose substantial liabilities for pollution resulting from our operations.

•limit or prohibit construction, drilling and other activities on certain lands lying within wilderness and other protected areas; and

•require the acquisition of a permit or other authorization and procurement of financial assurance before construction or drilling commences and for certain other activities;

Climate Change and Regulation of Methane and Other Greenhouse Gas Emissions.

Regulations included in Item 1 of Part I of this report for more information on methane emissions and greenhouse gas reporting.