What changed in this filing

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Item 1A. Risk Factors

2024-11-22 compared with 2023-11-17 · 78 added, 71 removed, 216 unchanged (41% of the section changed)

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The Company’s ability to borrow under its credit facilities and commercial paper agreements, and its ability to issue long-term debt under its indentures, depend on the Company’s compliance with its obligations under the facilities, agreements and indentures.

For example, to issue incremental long-term debt, the Company must meet an interest coverage test under its 1974 indenture.

In general, the Company’s operating income, subject to certain adjustments, over a consecutive 12-month period within the 15 months preceding the debt issuance, must be not less than two times the total annual interest charges on the Company’s long-term debt, taking into account the incremental issuance.

In addition, taking into account the incremental issuance, and using a pro forma balance sheet as of the last day of the 12-month period used in the interest coverage test, the Company must maintain a ratio of long-term debt to consolidated assets (as defined under the 1974 indenture) of not more than 60%.

The 1974 indenture defines consolidated assets as total assets less a number of items, including current and accrued liabilities.

Depending on their magnitude, factors that reduce the Company’s operating income and/or total assets, including impairments (i.e., write-downs) of the Company’s natural gas properties, or that increase current and accrued liabilities, like short-term borrowings and "out of the money" derivative financial instruments, could contribute to the Company’s inability to meet the interest coverage test or debt-to-assets ratio.

In addition, the Company's short-term bank loans and commercial paper are in the form of floating rate debt or debt that may have rates fixed for very short periods of time, resulting in exposure to interest rate fluctuations in the absence of interest rate hedging transactions.

The cost of long-term debt, the interest rates on the Company's short-term bank loans and commercial paper, and the ability of the Company to issue commercial paper are affected by its credit ratings published by S&P, Moody's Investors Service, Inc.

For example, to issue incremental long-term debt, subject to certain exceptions, the Company must meet an interest coverage test under its 1974 indenture.

In light of impairments recognized in fiscal 2024, the Company expects to be precluded from issuing incremental long-term debt from January 1, 2025 to June 13, 2025, the maturity date of the Company’s remaining indebtedness outstanding under the 1974 indenture.

However, to the extent a need arises to issue such incremental long-term debt, the Company expects to be able to place future principal and interest payments in trust for the benefit of bondholders pursuant to the terms of the 1974 indenture.

Depositing the future principal and interest payments in trust would effectively relieve the Company from its obligations to comply with the 1974 indenture’s restrictions, including those on the issuance of incremental long-term debt.

The Company’s short-term bank loans, commercial paper, and borrowings under the Term Loan Agreement, entered into on February 14, 2024 with six lenders (the “Term Loan Agreement”), are in the form of floating rate debt or debt that may have rates fixed for short periods of time (up to six months), resulting in exposure to interest rate fluctuations in the absence of interest rate hedging transactions.

The cost of long-term debt, the interest rates on the Company’s short-term bank loans, commercial paper, and borrowings under its Term Loan Agreement, and the ability of the Company to issue commercial paper are affected by its credit ratings published by S&P, Moody’s Investors Service, Inc.

and Fitch Ratings, Inc.

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In addition to the $1.4 billion, another $500 million of the Company’s outstanding long-term debt would be subject to an interest rate increase based solely on a downgrade of a credit rating assigned to the notes below investment grade, regardless of any additional fundamental changes.

Climate change, and the regulatory, legislative, consumer behaviors and capital access developments related to climate change, may adversely affect operations and financial results.

Climate change, and the laws, regulations and other initiatives to address climate change, may impact the Company’s financial results.

The regulatory, legislative, consumer behaviors and capital access developments related to climate change may adversely affect operations and financial results.

The laws, regulations and other initiatives to address climate change may impact the Company’s financial results.

It is not possible at this time to determine whether changes in the federal administration may change the regulatory focus and/or implementation of rules relating to climate change.

In early 2021, the U.S.

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nationally determined contribution to achieve a fifty to fifty-two percent reduction from 2005 levels in economy-wide net greenhouse gas pollution by 2030.

Executive orders from the federal administration, in

addition to federal, state and local legislative and regulatory initiatives proposed or adopted in an attempt to limit the effects of climate change, including greenhouse gas emissions, could have significant impacts on the energy industry including government-imposed limitations, prohibitions or moratoriums on the use and/or production of natural gas, establishment of a carbon tax and/or methane fee, lack of support for system modernization, as well as accelerated depreciation of assets and/or stranded assets.

Federal and state legislatures have from time to time considered bills that would establish a cap-and-trade program, cap-and-invest program, methane fee or carbon tax to incent the reduction of greenhouse gas emissions.

For example, in August 2022, the federal Inflation Reduction Act was signed into law, which includes a methane charge that is expected to be applicable to the reported annual methane emissions of certain oil and gas facilities, above specified methane intensity thresholds, starting in calendar year 2024.

Executive orders from the federal administration, in addition to federal, state and local legislative and regulatory initiatives

proposed or adopted in an attempt to limit the effects of climate change, including greenhouse gas emissions, could have significant impacts on the energy industry including government-imposed limitations, prohibitions or moratoriums on the use and/or production of natural gas, establishment of a carbon tax and/or methane fee, lack of support for system modernization, as well as accelerated depreciation of assets and/or stranded assets.

Federal and state legislatures have from time to time considered bills that would establish a cap-and-trade program, cap-and-invest program, methane fee, carbon tax, or other similar mechanisms to incent the reduction of greenhouse gas emissions.

For example, in August 2022, the federal Inflation Reduction Act was signed into law, which includes a waste emissions charge that is expected to be applicable to the annual methane emissions of certain oil and gas facilities, above specified methane intensity thresholds, for emissions reported to the U.S.

EPA for calendar year 2024.

A number of states have also adopted energy strategies or plans with goals that include the reduction of greenhouse gas emissions.

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If this proposed program or a similar program becomes effective and the Company becomes subject to new or revised cap-and-trade programs, cap-and-invest programs, methane charges, fees for carbon-based fuels or other similar costs or charges, the Company may experience additional costs and incremental operating expenses, which would impact our future earnings and cash flows, and may also experience decreased revenue in the event that implementation of these policies leads to reduced demand for natural gas.

In addition to the scoping plan, legislation or regulation that aims to reduce greenhouse gas emissions could also include natural gas bans, greenhouse gas emissions limits and reporting requirements, carbon taxes and/or similar fees on carbon dioxide, methane or equivalent emissions, restrictive permitting, increased efficiency standards requiring system remediation and/or changes in operating practices, and incentives or mandates to conserve energy or use renewable energy sources.

In addition to the CLCPA, legislation or regulation that aims to reduce greenhouse gas emissions could also include natural gas bans, greenhouse gas emissions limits and reporting requirements, carbon taxes and/or similar fees on carbon dioxide, methane or equivalent emissions, restrictive permitting, increased efficiency standards requiring system remediation and/or changes in operating practices, and incentives or mandates to conserve energy or use renewable energy sources.

For example, in May 2023, New York State passed legislation that prohibits the installation of fossil fuel burning equipment and building systems in new buildings commencing on or after December 31, 2025, subject to various exemptions.

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Additionally, the trend toward increased energy conservation, change in consumer behaviors, competition from renewable energy sources, and technological advances to address climate change may reduce the demand for natural gas, which could impact our future earnings and cash flows.

For further discussion of the risks associated with environmental regulation to address climate change, refer to Item 2, MD&A under the heading “Environmental Matters.”

Further, recent trends directed toward a low-carbon economy could shift funding away from, or limit or restrict certain sources of funding for, companies focused on fossil fuel-related development or carbon-intensive

For further discussion of the risks associated with environmental regulation to address climate change, refer to Part II, Item 7, MD&A under the heading “Environmental Matters.”

To the extent financial markets view climate change and greenhouse gas emissions as a financial risk, the Company’s cost of and access to capital could be negatively impacted.

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Organized opposition to the natural gas industry, including exploration and production activity, pipeline expansion and replacement projects, and the extension and continued operation of natural gas distribution systems, may continue to increase as a result of, among other things, safety incidents involving natural gas facilities, and concerns raised by policymakers, financial institutions and advocacy groups about greenhouse gas emissions, hydraulic fracturing, or fossil fuels generally.

This opposition may lead to increased regulatory and legislative initiatives that could place limitations, prohibitions or moratoriums on the use of natural gas, impose costs tied to carbon emissions, provide cost advantages to alternative energy sources, or impose mandates that increase operational costs associated with new natural gas infrastructure and technology.

This opposition may lead to increased regulatory and legislative initiatives that could place limitations, prohibitions or moratoriums on the use and development of natural gas, impose costs tied to carbon emissions, provide cost advantages to alternative energy sources, or impose mandates that increase operational costs associated with new natural gas infrastructure and technology.

There are also increasing litigation risks associated with climate change concerns and related disclosures.

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In addition, third parties could impede the Company’s acquisition, expansion or renewal of rights-of-way or land rights on a timely basis and on acceptable terms.

Any delay in project development or construction may prevent a planned project from going into service when anticipated, which could cause a delay in the receipt of revenues from those facilities, result in increased project costs due to extended construction timeframes, asset write-offs and materially impact operating results or anticipated results.

Additionally, delays in pipeline construction projects or gathering facility completion could impede the Exploration and Production segment's ability to transport its production to premium markets, or to fulfill obligations to sell at contracted delivery points.

Any delay in project development or construction may prevent a planned project from going into service when anticipated, which could cause a delay in the receipt of revenues from those facilities, result in increased project costs due to extended construction timeframes and asset write-offs, and materially impact operating results or anticipated results.

Additionally, delays in pipeline construction projects or gathering facility completion could impede the Exploration and Production segment’s ability to transport its production, or to fulfill obligations to sell at contracted delivery points.

FINANCIAL RISKS

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Additionally, supply chain disruptions, and the associated costs and inflation related thereto, could have an impact on the Company’s operations.

Economic conditions in the Company’s utility service

territories, along with legislative and regulatory prohibitions and/or limitations on terminations of service, also impact its collections of accounts receivable.

Customers of the Company’s Utility segment may have particular trouble paying their bills during periods of declining economic activity, high inflation, or high commodity prices, potentially resulting in increased bad debt expense and reduced earnings.

Economic conditions in the Company’s utility service territories, along with legislative and regulatory prohibitions and/or limitations on terminations of service, also impact its collections of accounts receivable.

Customers of the Company’s Utility segment may have particular trouble paying their bills during periods of declining economic activity, high inflation, or high commodity

prices, potentially resulting in increased bad debt expense and reduced earnings.

Similarly, if reductions were to occur in funding of the federal Low Income Home Energy Assistance Program, bad debt expense could increase and earnings could decrease.

In addition, exploration and production companies that are customers of the Company’s Pipeline and Storage segment may decide not to renew contracts for the same transportation capacity.

Certain customers of the Company's Exploration and Production segment can represent a concentrated risk during times of high commodity prices and high hedging losses.

Certain customers of the Company’s Exploration and Production segment can represent a concentrated risk from time to time.

Any of these events or circumstances could have or contribute to a material adverse effect on the Company’s results of operations, financial condition and cash flows.

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Both short-term and long-term price trends affect the economics of exploring for, developing, producing, and gathering natural gas.

Natural gas prices can be volatile and can be affected by various factors, including weather conditions, natural disasters, consumer demand, national and worldwide economic conditions, economic disruptions caused by terrorist activities, acts of war or major accidents, domestic and foreign political conditions and events, the price and availability of alternative fuels, the proximity to, and availability of, sufficient capacity on transportation and liquefaction facilities, regional and global levels of supply and demand, energy conservation measures, and government regulations.

Natural gas prices can be volatile and can be affected by various factors, including weather conditions, natural disasters, consumer demand, national and worldwide economic conditions, economic disruptions caused by terrorist activities, acts of war or major accidents, domestic and foreign political conditions and events, the price and availability of alternative fuels, the proximity to, and availability of, sufficient availability of and capacity on transportation and liquefaction facilities, regional and global levels of supply and demand, energy conservation measures, and government regulations.

The Company sells the natural gas that it produces at a combination of current market prices, indexed prices or through fixed- price contracts.

The Company hedges a significant portion of future sales that are based on indexed prices utilizing the physical sale counter-party and/or the financial markets.

The Company hedges a substantial portion of future sales that are based on indexed prices utilizing the physical sale counterparty and/or the financial markets.

The prices the Company receives depend upon factors beyond the Company’s control, including the factors affecting price mentioned above.

Any prolonged reduction in natural gas prices could result in the Company reducing the level of exploration and production activity the Company otherwise would pursue, which could have a material adverse effect on its future revenues, cash flows and results of operations.

In the Company’s Pipeline and Storage segment, significant changes in the price differential between equivalent quantities of natural gas at different geographic locations could adversely impact the Company.

In the Company’s Pipeline and Storage segment, significant changes in the price differential between equivalent quantities of natural gas at different geographic locations or sustained high natural gas prices relative to other sources of energy could adversely impact the Company.

For example, if the price of natural gas at a particular receipt point on the Company’s pipeline system increases relative to the price of natural gas at other locations, then the volume of natural gas received by the Company at the relatively more expensive receipt point may decrease, or the Company may need to discount the approved tariff rate for that transportation path in the future in order to maintain the existing volumes on its system.

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If contract renewals were to decrease, revenues and earnings in this segment may decrease.

Significant changes in the price differential between futures contracts for gas having different delivery dates could also adversely impact the Company.

For example, if the prices of natural gas futures contracts for winter deliveries to locations served by the Pipeline and Storage segment decline relative to the prices of such contracts for summer

deliveries (as a result, for instance, of increased production of gas within the segment’s geographic area or other factors), then demand for the Company’s natural gas storage services driven by that price differential could decrease.

Significant changes in the price differential between futures contracts for natural gas having different delivery dates could also adversely impact the Company.

For example, if the prices of natural gas futures contracts for winter deliveries to locations served by the Pipeline and Storage segment decline relative to the prices of such contracts for summer deliveries (as a result, for instance, of increased production of natural gas within the segment’s geographic area or other factors), then demand for the Company’s natural gas storage services driven by that price differential could decrease.

These changes could adversely affect future revenues, cash flows and results of operations.

In the Company’s Utility segment, during periods when natural gas prices are significantly higher than historical levels, customer demand could be reduced, thereby decreasing revenue.

In the Company’s Utility segment, during periods when natural gas prices are significantly higher than historical levels, customer demand could be reduced, thereby decreasing delivery revenues, particularly in the Company’s Pennsylvania service territory where delivery revenues are not protected by a revenue decoupling mechanism.

Customers may also have trouble paying the resulting higher bills when gas prices are higher or in periods of economic uncertainty, which could increase bad debt expenses and could ultimately reduce earnings.

Additionally, increases in the cost of purchased gas affect cash flows and can therefore impact the amount or availability of the Company’s capital resources.

The Company has significant transactions involving price hedging of its natural gas production as well as its fixed price sale commitments.

The Company has significant transactions involving price hedging of its natural gas production, fixed price natural gas sale commitments, as well as its foreign exchange transactions.

To protect itself to some extent against price volatility and to lock in fixed pricing on natural gas production for certain periods of time, the Company’s Exploration and Production segment regularly enters into commodity price derivatives contracts (hedging arrangements) with respect to a portion of its expected production.

These contracts may extend over multiple years, covering a substantial majority of the Company’s expected natural gas production over the course of the current fiscal year, and lesser percentages of subsequent years’ expected production.

These contracts reduce exposure to subsequent price drops but can also limit the Company’s ability to benefit from increases in commodity prices.

These contracts reduce exposure to subsequent price drops but can also limit the Company’s ability to benefit from increases in natural gas prices.

The nature of these hedging contracts could lead to potential liquidity impacts in scenarios of significantly increased natural gas prices if the Company has hedged its current production at prices below the current market price.

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That interest-bearing cash collateral is returned to us in whole or in part upon a reduction in forward market prices, depending on the amount of such reduction, or in whole upon settlement of the related derivative contract.

Use of energy commodity price hedges also exposes the Company to the risk of nonperformance by a contract counterparty.

Use of price hedges, including natural gas hedges and foreign exchange hedges, also exposes the Company to the risk of nonperformance by a contract counterparty.

These parties might not be able to perform their obligations under the hedge arrangements.

In the Exploration and Production segment, under the Company’s hedging guidelines, commodity derivatives contracts must be confined to the price hedging of existing and forecast production.

The Company maintains a system of internal controls to monitor compliance with its policy.

In the Exploration and Production segment, under the Company’s hedging guidelines, natural gas derivatives contracts must be confined to the price hedging of existing and forecast production.

The Company maintains a system of internal controls to monitor compliance with its guidelines.

However, unauthorized speculative trades, if they were to occur, could expose the Company to substantial losses to cover positions in its derivatives contracts.

In addition, in the event the Company’s actual production of natural gas falls short of hedged volumes, the Company may incur substantial losses to cover its hedges to the extent the hedges are in a loss position.

The Dodd-Frank Act increased federal oversight and regulation of the over-the-counter derivatives markets and certain entities that participate in those markets.

Although regulators have issued certain regulations, other rules that may be relevant to the Company have yet to be finalized.

For discussion of the risks associated with the Dodd-Frank Act, refer to Item 7, MD&A under the heading “Market Risk Sensitive Instruments.”

We may be subject to risks related to increased federal oversight and regulation of the over-the-counter derivatives markets and certain entities that participate in those markets.

For discussion of these risks, refer to Item 7, MD&A under the heading “Market Risk Sensitive Instruments.”

You should not place undue reliance on reserve information because such information represents estimates.

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the assumed effect of governmental regulation;

and assumptions concerning natural gas prices, production and development costs, severance and excise taxes, and capital expenditures.

and assumptions concerning natural gas prices, production and development costs, severance and excise taxes, and capital

expenditures.

Changes in natural gas prices impact the quantity of economic natural gas reserves.

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The Company accounts for its exploration and production activities under the full cost method of accounting.

Each quarter, the Company must perform a "ceiling test" calculation, comparing the level of its unamortized investment in oil and natural gas properties to the present value of the future net revenue projected to be recovered from those properties according to methods prescribed by the SEC.

In determining present value, the Company uses a 12-month historical average price for oil and natural gas (based on first day of the month prices and adjusted for hedging) as well as the SEC mandated discount rate.

Each quarter, the Company must perform a “ceiling test” calculation, comparing the level of its unamortized investment in exploration and production properties to the present value of the future net revenue projected to be recovered from those properties according to methods prescribed by the SEC.

In determining present value, the Company uses a 12-month historical average price for commodity pricing (based on first day of the month prices and adjusted for hedging) as well as the SEC mandated discount rate.

If, at the end of any quarter, the amount of the unamortized investment exceeds the net present value of the projected future cash flows, such investment may be considered to be “impaired,” and the full cost authoritative accounting and reporting guidance require that the investment must be written down to the calculated net present value.

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Depending on the magnitude of any decrease in average prices, that charge could be material.

Under the Company's existing indenture covenants, an impairment could restrict the Company's ability to issue

incremental long-term unsecured indebtedness for a period of time, beginning with the fourth calendar month following the impairment.

Under the Company’s existing indenture covenants, an impairment will restrict the Company’s ability to issue incremental long-term unsecured indebtedness for a period of time, beginning with the fourth calendar month following the impairment and ending not later than June 13, 2025, the maturity date of the Company’s remaining indebtedness outstanding under its 1974 indenture.

In addition, because an impairment results in a charge to retained earnings, it lowers the Company’s total capitalization, all other things being equal, and increases the Company’s debt to capitalization ratio.

As a result, an impairment can impact the Company’s ability to maintain compliance with the debt to capitalization covenant set forth in its committed credit facility.

The Company last recognized non-cash, pre-tax impairment charges on its oil and natural gas properties in fiscal years 2020 and 2021, in the amounts of $449.4 million and $76.2 million, respectively.

The Company recorded a pre-tax impairment under the ceiling test during the quarter ended June 30, 2024 in the amount of $200.7 million, and during the quarter ended September 30, 2024 in the amount of $263.0 million.

Looking ahead, the first day of the month Henry Hub spot price for natural gas in October and

November 2024 was $2.66 per MMBtu and $1.87 per MMBtu, respectively.

Given the October and November prices, and the expected replacement of higher gas prices with lower gas prices in the historical 12-month average that will be used in the ceiling test calculation at December 31, 2024, the Company expects to record a ceiling test impairment for the quarter ending December 31, 2024, and could record additional ceiling test impairments in fiscal 2025.

OPERATIONAL RISKS

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Furthermore, as substantially all of our production is transported from the well pad to interconnections with various FERC-regulated pipelines through our affiliated gathering facilities, such a production curtailment could result in significantly reduced throughput on those facilities, adversely affecting revenues and cash flows of our Gathering segment.

The disruption of the Company's information technology and operational technology systems, including third party attempts to breach the Company’s network security, could adversely affect the Company's financial results.

Attacks on or disruption of the Company ’ s information technology and operational technology systems, including third party attempts to breach the Company’s network security, or other cybersecurity threats and incidents could adversely affect the Company ’ s operations and financial results.

The Company relies on information technology and operational technology systems to process, transmit, and store information, to manage and support a variety of business processes and activities, and to comply with regulatory, legal, and tax requirements.

The Company's information technology and operational technology systems, some of which are dependent on services provided by third parties, may be vulnerable to damage, interruption, or shutdown due to any number of causes outside of our control such as catastrophic events, natural disasters, fires, power outages, systems failures, telecommunications failures, and employee error or malfeasance.

In addition, the Company's information technology and operational technology systems are subject to attempts by others to gain unauthorized access, or to otherwise introduce malicious software.

The Company’s information technology and operational technology

systems, some of which are dependent on third party business partners, may be vulnerable to damage, interruption, or shutdown due to any number of causes outside of our control such as catastrophic events, natural disasters, fires, power outages, systems failures, telecommunications failures, and employee error or malfeasance.

In addition, the Company’s information technology and operational technology systems and those of our third party business partners are subject to cybersecurity threats and attacks, including attempts by others to gain unauthorized access, or to otherwise introduce malicious software or software vulnerabilities.

These attempts might be the result of industrial or other espionage, or actions by hackers seeking to harm the Company, its services or customers.

These more sophisticated cyber-related attacks, as well as cybersecurity failures resulting from human error, pose a risk to the security of the Company’s systems and networks and the confidentiality, availability and integrity of the Company’s and its customers’ data.

These more sophisticated cyber-related attacks, as well as cybersecurity failures resulting from human error, pose a risk to the security and accessibility of the Company’s systems and networks and the confidentiality, availability and integrity of the Company’s and its customers’ data.

That data may be considered sensitive, confidential, or personal information that is subject to privacy and security laws, regulations and directives.

While the Company employs reasonable and appropriate controls to maintain and protect its information technology and operational technology systems, the Company may be vulnerable to material disruptions, material security breaches, lost or corrupted data, programming errors and employee errors and/or malfeasance that could lead to interruptions to the Company's business operations or the unauthorized access, use, disclosure, modification or destruction of sensitive, confidential or personal information.

Attempts to breach the Company’s network security may result in disruption of the Company’s business operations and services, delays in production, theft of sensitive and valuable data, damage to our physical systems, and reputational harm.

Significant expenditures may be required to remedy system disruptions or breaches, including restoration of customer service and enhancement of information technology and operational technology systems.

The Company seeks to prevent, detect and investigate security incidents, but in some cases the Company might be unaware of an incident or its magnitude and effects.

In addition to existing risks, the adoption of new technologies may increase the Company’s exposure to data breaches or the Company’s ability to detect and remediate effects of a breach.

The Company has experienced attempts to breach its network security and has received notifications from third-party service providers who have experienced disruptions to services or data breaches where Company data was potentially impacted.

Although the scope of such incidents is sometimes unknown, they could prove to be material to the Company.

While the Company employs controls to maintain and protect its information technology and operational technology systems, the Company may be vulnerable to disruptions, cybersecurity incidents, lost or corrupted data, programming errors and employee errors and/or malfeasance that could lead to interruptions to the Company’s business operations or the unauthorized access, use, disclosure, modification or destruction of sensitive, confidential or personal information.

Cybersecurity threats or attempts to breach the Company’s network security may result in disruption of the Company’s business operations and services, delays in production, theft of sensitive and valuable data, damage to our physical systems, malicious alteration or corruption of data or systems, costs related to remediation or the payment of ransom, and litigation including individual claims or consumer class actions, commercial litigation, administrative, and civil or criminal investigations or actions, regulatory intervention and sanctions or fines, investigation and remediation costs and reputational harm.

Significant expenditures may be required to remedy system disruptions, cybersecurity incidents, or breaches or address cybersecurity threats, including restoration of customer service and enhancement of information technology and operational technology systems.

We have invested in the protection of data and information technology, and actively work to enhance our business continuity and disaster recovery capabilities;

however, there can be no assurance that our efforts will be successful.

The Company seeks to prevent, detect and investigate cybersecurity incidents, but in some cases the Company might be unaware of an incident or its magnitude and effects.

In addition to existing risks and cybersecurity threats, the adoption of new technologies, including generative artificial intelligence tools, may increase the Company’s exposure to data breaches and cybersecurity incidents or the Company’s ability to detect and remediate effects of breaches and cybersecurity incidents.

The Company has experienced attempts to breach its network security and cybersecurity threats and has received notifications from third-party service providers who have experienced disruptions to services or data breaches where Company data was potentially impacted.

Although the scope of such occurrences and incidents is sometimes unknown, they could prove to be material to the Company.

Even though insurance coverage is in place for cyber-related risks, if a material disruption or breach were to occur, the Company’s operations, earnings, cash flows and financial condition could be adversely affected to the extent not fully covered by such insurance.

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The Company’s drilling of development wells can involve significant risks, including those related to timing, success rates, and cost overruns, and these risks can be affected by lease and rig availability, completion crew and related equipment availability, geology, and other factors.

Drilling for natural gas can be unprofitable, not only from non-productive wells, but from productive wells that do not produce sufficient revenues to return a profit.

Also, title problems, competition and cost to acquire mineral rights, weather conditions, governmental requirements, including completion of environmental impact analyses and compliance with other environmental laws and regulations, and shortages or delays in the delivery of equipment and services can delay drilling

operations or result in their cancellation.

The cost of drilling, completing, and operating wells is significant and often uncertain, and new wells may not be productive or the Company may not recover all or any portion of its investment.

Production can also be delayed or made uneconomic if there is insufficient gathering, processing and transportation capacity available at an economic price to get that production to a location where it can be profitably sold.

Drilling for natural gas and related investments in supporting facilities can be unprofitable, not only from non-productive wells, but from productive wells that do not produce sufficient revenues to return a profit.

Also, title problems, competition and cost to acquire mineral

rights, weather conditions, governmental requirements, including completion of environmental impact analyses and compliance with other environmental laws and regulations, and shortages or delays in the delivery of equipment and services can delay drilling operations or result in their cancellation.

The cost of drilling, completing, and operating wells, as well as the development of related exploration and production assets, is significant and often uncertain.

New wells and related assets may not be successful or the Company may not recover all or any portion of its investment.

Production can also be delayed or made uneconomic if there is insufficient gathering and transportation capacity available at an economic price to get that production to a location where it can be profitably sold.

Without continued successful exploitation or acquisition activities, the Company’s reserves and revenues will decline as a result of its current reserves being depleted by production.

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Climate change could create acute and/or chronic physical risks to the Company’s operations, which may adversely affect financial results.

Acute physical risks include more frequent and severe weather events, which may result in adverse physical effects on portions of natural gas infrastructure, and could disrupt the Company’s supply chain and ultimately its operations.

Acute physical risks include more frequent and severe weather events, which may result in adverse physical effects on portions of natural gas infrastructure, and may disrupt the Company’s supply chain, workforce, and ultimately its operations.

Disruption of production activities, as well as natural gas transportation and distribution systems, could result in reduced operational efficiency, and customer service interruption.

Severe weather events could also cause physical damage to facilities, all of which could lead to reduced revenues, increased insurance premiums or increased operational costs.

Severe weather events could also cause physical damage to facilities, which could lead to reduced revenues, increased insurance premiums or increased operational costs.

To the extent the Company’s regulated businesses are unable to recover those costs, or if the recovery of those costs results in higher rates and reduced demand for Company services, the Company’s future financial results could be adversely impacted.

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These labor agreements are negotiated periodically, and therefore, the Company is subject to the risk that such agreements may not be able to be renewed on reasonably satisfactory terms, on anticipated timelines, or at all.

In connection with the negotiation of such collective bargaining agreements, or in future matters involving collective bargaining units representing the Company’s workforce, the Company could experience, among other things, strikes, work stoppages, slowdowns or lockouts, which could cause a disruption of the Company's operations and have a material adverse effect on the Company's results of operations and financial condition.

For example, the Company is currently negotiating with two collective bargaining units in New York for agreements that expire in February 2025.

In connection with the negotiation of such collective bargaining agreements, or in future matters involving collective bargaining units representing the Company’s workforce, the Company could experience, among other things, strikes, work stoppages, slowdowns or lockouts, which could cause a disruption of the Company’s operations, impact the Company’s ability to fully execute operational plans, and have a material adverse effect on the Company’s results of operations and financial condition.

REGULATORY RISKS

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Administrative agencies may apply existing laws and regulations in unanticipated, inconsistent or legally unsupportable ways, making it difficult to develop and complete projects, and harming the economic climate generally.

In addition, judicial decisions limiting the authority of regulatory agencies, or decisions impacting current regulations and policies implemented by such agencies, could create uncertainty regarding the regulatory landscape and impact the Company’s ability to plan for future investments.

Various aspects of the Company’s operations are subject to regulation by a variety of federal and state agencies with respect to permitting and environmental requirements.

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The Company’s business operations are subject to federal, state, and local laws, regulations and agency policies relating to environmental protection including obtaining and complying with permits, leases, approvals, consents and certifications from various governmental and permit authorities.

These laws, regulations and policies concern the generation, storage, transportation, disposal, emission or discharge of pollutants, contaminants, hazardous substances and greenhouse gases into the environment, the reporting of such matters, and the general protection of public health, natural resources, wildlife and the environment.

For example, currently applicable environmental laws and regulations restrict the types, quantities and concentrations of

materials that can be released into the environment in connection with regulated activities, limit or prohibit activities in certain protected areas, and may require the Company to investigate and/or remediate contamination at certain current and former properties regardless of whether such contamination resulted from the Company’s actions or whether such actions were in compliance with applicable laws and regulations at the time they were taken.

These laws, regulations and policies concern the generation, storage, transportation, disposal, emission or discharge of pollutants,

contaminants, hazardous substances and greenhouse gases into the environment, the reporting of such matters, and the general protection of public health, natural resources, wildlife and the environment.

For example, currently applicable environmental laws and regulations restrict the types, quantities and concentrations of materials that can be released into the environment in connection with regulated activities, limit or prohibit activities in certain protected areas, and may require the Company to investigate and/or remediate contamination at certain current and former properties regardless of whether such contamination resulted from the Company’s actions or whether such actions were in compliance with applicable laws and regulations at the time they were taken.

Moreover, spills or releases of regulated substances or the discovery of currently unknown contamination could expose the Company to material losses, expenditures and environmental, health and safety liabilities.

Such liabilities could include penalties, sanctions or claims for damages to persons, property or natural resources brought on behalf of the government or private litigants that could cause the Company to incur substantial costs or uninsured losses.

In addition, estimates of the Company’s potential liabilities relating to current or former natural gas and oil properties, including the costs associated with plugging and abandoning wells, may be incorrect, and actual plugging and abandonment expenses may vary substantially from the Company’s estimates.

Costs of compliance and liabilities could negatively affect the Company’s results of operations, financial condition and cash flows.

19 unchanged sentences

Consequently, real or anticipated changes in the Company’s credit ratings will generally affect the market value of the specific debt instruments that are rated, as well as the market value of the Company’s common stock.

Company’s credit ratings, however, may not reflect the potential impact on the value of its common stock of risks related to structural, market or other factors discussed in this Form 10-K.

The Company’s credit ratings, however, may not reflect the potential impact on the value of its common stock of risks related to structural, market or other factors discussed in this Form 10-K.

The increasing costs of certain employee and retiree benefits, and the regulatory treatment of certain benefit plan activity, could adversely affect the Company’s results.

3 unchanged sentences

Increases to the costs of pension, other post-retirement and medical benefits could have an adverse effect on the Company’s financial results.

The Company’s earnings and cash flows may also be impacted by the rate treatment of certain income and expense activity and regulatory asset and liability balances that would be determined in a future rate proceeding.

The Company’s earnings and cash flows may also be impacted by the rate treatment of certain income and expense activity, including the crediting of employee benefit plan trust income to ratepayers by reducing delivery rates and customer revenues, and the refund of regulatory liability balances.

The application of current rate treatment is subject to change in a future rate proceeding.

Significant shareholders or potential shareholders may attempt to effect changes at the Company or acquire control over the Company, which could adversely affect the Company’s results of operations and financial condition.

4 unchanged sentences

As a result, shareholder campaigns could adversely affect the Company’s results of operations and financial condition.

Item 1B Unresolved Staff Comments

Item 1C Cybersecurity

Not applicable.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors