Common use of RISK FACTORS Clause in Contracts

RISK FACTORS. YOU SHOULD CAREFULLY CONSIDER THE FOLLOWING RISK FACTORS IN DETERMINING WHETHER TO VOTE TO APPROVE THE MERGER PROPOSALS. THE MERGER VALUES INVOLVE ESTIMATES THAT WILL NOT BE ADJUSTED Estimates of Proved Reserves and Future Net Revenues May Change. The calculations of the partnerships' proved reserves of crude oil, natural gas liquids and natural gas and future net revenues from those reserves included in this document are only estimates. The accuracy of any reserve estimate is a function of: - the quality of available data; - engineering and geological interpretation and judgment; - the assumptions about quantities of recoverable oil, natural gas liquids and natural gas reserves; - the assumptions about prices for crude oil, natural gas liquids and natural gas; and - the assumptions about costs to extract, transport and process, if necessary, crude oil, natural gas liquids and natural gas to their point of sale. Actual prices, production, operating expenses and quantities of recoverable oil and natural gas reserves may vary from those assumed in the estimates. The variances may be significant. Any significant variance from the assumptions used could result in the actual quantity of the partnerships' reserves and future net revenues being materially different from the estimates in the partnerships' reserve reports and in the calculation of the merger values. In addition, changes in production levels and changes in crude oil, natural gas liquids and natural gas prices after the date of the estimate may result in substantial upward or downward revisions. Assumptions about Reserves, Pricing and Costs Used in the Merger Values May Be Wrong. Pioneer and Pioneer USA based the reserve value component of the merger values on the discounted, or present value of, estimated future net revenues from the partnerships' properties using estimated reserves at June 30, 1999,