Table of Contents Strategic determinations, including the allocation of capital and other resources to strategic opportunities, are challenging in the face of shifting market conditions, and our failure to appropriately allocate capital and resources among our strategic opportunities may adversely affect our financial condition and reduce our future growth rate. Certain of our undeveloped assets are subject to leases that will expire over the next several years unless production is established on units containing the acreage. Natural gas and oil drilling and producing and transportation operations can be hazardous and may expose us to liabilities. limited in scope, and do not address all material risks relating to us, but rather reflect only the view of each rating agency of the likelihood we will be able to repay our debt at the time the rating is issued. An explanation of the significance of each rating may be obtained from the applicable rating agency. As of February 26, 2019, our long-term issuer ratings were Ba2 by Moody’s, BB by Standard and Poor’s and BB by Fitch Investor Services. There can be no assurance that such credit ratings will remain in effect for any given period of time or that such ratings will not be lowered, suspended or withdrawn entirely by the rating agencies, if, in each rating agency’s judgment, circumstances so warrant. Actual downgrades in our credit ratings may also impact our liquidity. Many of our existing commercial contracts contain, and future commercial contracts may contain, provisions permitting the counterparty to require increased security upon the occurrence of a downgrade in our credit rating. Providing additional security, such as posting letters of credit, could reduce our available cash or our liquidity under our revolving credit facility for other purposes. We had $112 million of letters of credit outstanding at December 31, 2018. The amount of additional financial assurance would depend on the severity of the downgrade from the credit rating agencies, and a downgrade could result in a decrease in our liquidity. We necessarily must consider future price and cost environments when deciding how much capital we are likely to have available from net cash flow and how best to allocate it. Our current philosophy is to generally operate within cash flow from operations net of changes in working capital and to invest capital only in projects projected to generate a PVI of 1.3 or greater, allocating generally to the highest PVI projects. Volatility in prices and potential errors in estimating costs, reserves or timing of production of the reserves could result in uneconomic projects or economic projects generating less than 1.3 PVI. Approximately 13,123 and 43,092 net acres of our Northeast Appalachia and Southwest Appalachia acreage, respectively, will expire in the next three years if we do not drill successful wells to develop the acreage or otherwise take action to extend the leases. Our ability to drill wells depends on a number of factors, including certain factors that are beyond our control, such as the ability to obtain permits on a timely basis or to compel landowners or lease holders on adjacent properties to cooperate. Further, we may not have sufficient capital to drill all the wells necessary to hold the acreage without increasing our debt levels, or given price projections at the time, drilling may not be estimated to achieve a PVI of at least 1.3 or be judged to be the best use of our capital. To the extent we do not drill the wells, our rights to acreage can be lost. Drilling and production operations are subject to many risks, including well blowouts, cratering and explosions, pipe failures, fires, formations with abnormal pressures, uncontrollable flows of oil, natural gas, brine or well fluids, severe weather, natural disasters, groundwater contamination and other environmental hazards and risks. Some of these risks or hazards could materially and adversely affect our revenues and expenses by reducing or shutting in production from wells, loss of equipment or otherwise negatively impacting the projected economic performance of our prospects. If any of these risks occurs, we could sustain substantial losses as a result of: For our non-operated properties, we depend on the operator for operational and regulatory compliance. 31 · injury or loss of life; · severe damage to or destruction of property, natural resources or equipment; · pollution or other environmental damage; · clean-up responsibilities; · regulatory investigations and administrative, civil and criminal penalties; and · injunctions resulting in limitation or suspension of operations. Index to Financial Statements