HOUSTON, March 2, 2011 /PRNewswire/ -- Harvest Natural Resources, Inc. (NYSE: HNR) today announced an increase in reserves for both its U.S. and Venezuela operations. The reserve report, dated December 31, 2010, was prepared by the independent petroleum engineering firm of Ryder Scott Company, L.P. (Ryder Scott) at Harvest's request. � 

Harvest has received its first comprehensive report covering its Uinta Basin reserves in Utah. Proved and probable reserves (2P) net to Harvest in Utah have increased to 15.3 million barrels of oil equivalent (MMBOE) at December 31, 2010, compared to 0.4 MMBOE at year end 2009. � Proved reserves net to Harvest increased to 4.6 MMBOE at December 31, 2010, compared to 0.4 MMBOE at year end 2009. � Proved, probable and possible reserves (3P) net to Harvest in Utah increased to 86.4 MMBOE at December 31, 2010, compared to 0.4 MMBOE at year end 2009. On a barrel of oil equivalent (BOE) basis, approximately 75 percent of the 3P reserves are oil, with the remainder being associated gas. � Geographically, approximately 70 percent of the 3P reserves are located in the Lower Green River/Upper Wasatch Development Project with the remaining 30 percent being located in the Monument Butte Extension Project. The reserve additions are a result of Harvest's successful Antelope Project delineation drilling program conducted during 2010 and reflect only the results of the wells completed and producing at year end 2010 in the proved category. � The 1P, 2P, and 3P reserves correspond to 43, 203 and 1,207 identified drilling locations, respectively. The Harvest net Before Tax Discounted Future Net Income from the Utah 2P reserves has increased to approximately $109 million, and the Harvest net Before Tax Discounted Future Net Income from the Utah 3P reserves has increased to approximately $617 million. � 

In addition, Harvest is reporting a reserve increase attributable to Petrodelta, S.A. (Petrodelta), Harvest's 32 percent indirectly owned Venezuelan affiliate. 2P reserves net to Harvest in Venezuela have increased to 103.6 MMBOE at December 31, 2010, a 24 percent increase over year end 2009. � Proved reserves net to Harvest in Venezuela increased to 50.0 MMBOE at December� 31, 2010, an 8 percent increase over year end 2009. 3P reserves stand at 220.6 MMBOE at December� 31, 2010, virtually unchanged from last year. These reserve additions are the result of successful recent drilling and the extension of Block 5, a previously unproven fault block in the El Salto field and recent development drilling success in other fields.

For the Company as a whole, proved reserves totaled 54.6 MMBOE and 2P reserves were 118.9 MMBOE at yearend 2010, reflecting increases of 17 percent and 42 percent, respectively. � Proved additions to reserves replaced production by 474 percent. See Tables 1 and 2 attached for an overview of the aforementioned 2010 year end reserve report.

Operational Highlights:

United States

• Net production to Harvest during the months of January and February 2011 was approximately 650 barrels of oil equivalent per day (BOEPD).
• We are currently producing from 14 wells in the Monument Butte Extension project, including 13 wells operated by Newfield Exploration and one well operated by Harvest; � 
• We have established production from five wells in the Harvest-operated Lower Green River/Upper Wasatch development project. � A sixth well has been drilled and will be hydraulically fractured in early March. � A seventh well is currently drilling and is expected to reach total depth in early March, and be hydraulically fractured in early April. � We expect to achieve a sustained gross Harvest operated production rate in excess of 1,000 BOPD when the above-mentioned seven wells are all producing routinely in April 2011;

Venezuela

• The Before Tax Discounted Future Net Income from the six fields 2P reserves net to Harvest has increased to approximately $2.3 billion, 68 percent increase from year end 2009;
• The 2011 capital budget is expected to be approximately $220 million, which includes provisions to drill 28 oil wells, two water injector wells, one gas injector well and construction costs for pipeline and related facilities. � Shareholders of Petrodelta are discussing acceleration of program;
• During 2011, Petrodelta has drilled three development wells, two were put on stream in Uracoa and Temblador with average initial production of 460 BOPD. Another well at El Salto field was recently finished and is currently under evaluation;
• Petrodelta's first appraisal well is currently drilling in the untested Isleno field which is expected to be completed and tested by mid-March;

Indonesia

• The Lariang LG-1 Well, the first of two planned exploration wells was spud on January 6, 2011 in the Budong Budong Block, West Sulawesi. � The well is to be drilled to a depth of approximately 7,200 feet;
• The well has reached 4,536 feet in the Miocene, the secondary objective, and has logged and wireline tested several oil and gas sands from 1,509 to 1,689 feet and 2,362 feet to 2,411 feet. 9-5/8 inch casing was set at 4,525 feet;

Gabon

• The Company has purchased all long lead items required for drilling and they are either on site or on route to Port Gentil. � Projected spud date of the exploration well expected to occur at the beginning of the second quarter of 2011.

Harvest President and Chief Executive Officer, James Edmiston, said, "2010 was a gratifying year for Harvest as our growth plan began to bear fruit. � In Utah, the Company proceeded from its discovery at the Bar F well in March of last year, to its successful delineation and appraisal program of this very exciting oil resource play where we believe we have up to 1,200 future drilling locations targeting the Green River and Wasatch oil-bearing formations. In Venezuela, Petrodelta logged substantial increases in reserves as the potential of the El Salto Field gained clarity."

Mr. Edmiston continued, "2011, we hope, will be even more exciting as we plan to test significant exploration projects in both Indonesia and Gabon. � In Indonesia, the Lariang LG-1 well has provided encouragement as the secondary target Miocene section drilled to date has confirmed the presence of hydrocarbons and significant formation overpressure. � The high formation pressure gradient, combined with mechanical problems with the top drive on the rig, has contributed to slower than expected progress. � After setting the 9-5/8 inch casing, we will proceed to drill ahead and test the primary target Eocene sands in the coming weeks."

Mr. Edmiston concluded saying, "The exploration of strategic alternatives announced in September is ongoing. � We've received interest from multiple parties in both our producing assets as well as our exploration portfolio. � The evaluation of those alternatives, along with the execution of our current exploration drilling programs in Indonesia and Gabon, will be our focus in the near term."

VENEZUELA

During 2010, Petrodelta drilled and completed 16 development wells. � Petrodelta produced approximately 8.6 million barrels of oil, an increase of 9 percent over the previous year. Petrodelta also sold 2.2 billion cubic feet (BCF) of natural gas, a decrease of 50 percent from 2009. The average sales price for Petrodelta's crude oil production was $70.36 per barrel, 22 percent higher than 2009, and the average sales price received for natural gas remains contractually fixed at $1.54 per thousand cubic feet. � Petrodelta's average production rate during 2010 was 23,455 BOPD, 9 percent higher than the previous year.

Petrodelta's production output for the first quarter of 2011 is projected to be approximately 29,000 BOPD and the target for the year is 36,000 BOPD. � The 2011 Petrodelta capital budget is expected to be approximately $220 million with a significant portion of that total related to infrastructure costs to support the further development of the Temblador and El Salto fields. � This program should be self-funding at a WTI oil price of $70 per barrel in 2011. Petrodelta expects to drill 28 oil wells, two water injector wells and one gas injector well, and the drilling program includes utilizing two rigs to drill both development and appraisal wells for both increasing production capacity and appraising the substantial resource base.

The reserve report for the Venezuela fields assumes a West Texas Intermediate crude oil price of $79.43 per barrel, which yields $70.43 per barrel after adjustment for location and quality. The natural gas reserves were based on a contractual price of $1.54 per thousand cubic feet (MCF). Both oil and gas prices were held constant.

EXPLORATION AND OTHER DEVELOPMENT DRILLING ACTIVITIES

United States

Harvest and our third party joint venture participant control an approximately 69,000 net acre land position in the Uintah Basin. � Harvest has an approximate 70 percent working interest in the land position, corresponding to a Harvest net position of approximately 48,000 net acres. � Following is an update on operational activities being conducted on this land position.

Lower Green River/Upper Wasatch Oil Delineation and Development Project

We are currently drilling our seventh Harvest-operated well in the Lower Green River/Upper Wasatch project. � Harvest has a 70 percent working interest in this project. Following is a recap of the wells and their current status.

The Bar F 1-20-3-2 was the discovery well for this project in the central part of our land position and commenced oil production on March 6, 2010. � To date, the Bar F has produced 56,000 gross barrels of oil and 42 gross MMCF gas in 10 producing months. � The well experienced some downtime for pump installations and is currently producing at about 80 BOPD and 75 MCFD gross on electric submersible pump (ESP).

The Kettle 1-10-3-1 was drilled in the eastern end of our acreage and commenced production on October 22, 2010, and has produced 12,000 gross barrels of oil and 64 gross MMCF of gas to date in three producing months. � The well is currently shut-in pending connection of the produced gas to the previously announced new El Paso Midstream Group, Inc. gas gathering system. � The gathering system is under construction and we expect to complete the tie-in of the Kettle in March. � The most recent gross production rate from the Kettle was 70 BOPD and 400 MCFD of gas flowing.

The ON Moon 1-27-3-2 was drilled in the southern portion of our Lower Green River/Upper Wasatch project and commenced production on November 7, 2010, and has produced 13,000 gross barrels of oil and 8 gross MMCF of gas to date flowing in 2.5 producing months. � The most recent gross production rate flowing was 80 BOPD and 50 MCFD of gas. � We expect to have an ESP installed in the well in early March and anticipate a production rate of 200-300 BOPD after the ESP is installed.

The Dart 1-12-3-2 was drilled in the northern end of our land position and commenced production on February 6, 2011, and produced 4,800 gross barrels of oil and 2.6 gross MMCF of gas on an eight day flowing test. � At the conclusion of the test, the well was producing approximately 400 BOPD with a flowing tubing pressure of approximately 500 psi. � The tank battery for this well has been completed and the well was placed on routine production March 1, 2011.

The Giles 1-19-3-2 was drilled in the west central portion of our land position and logs were favorable. � The well was hydraulically fractured with 10 stages on February 14-15, 2011. � The well has flowed oil at a rate of 177 BOPD for two days during the process of drilling out fracturing plugs. � We expect to complete drill out of fracturing plugs and place the well on production through the tank battery by mid-March 2011.

The Yergensen 1-9-3-1, a one mile offset to the Kettle well, has been drilled and logged. � It is scheduled to be hydraulically fractured with 13 stages on March 3-4, 2011. � The tank battery for this well is under construction.

The Evans 1-4-3-3 is currently at intermediate casing point of 9,668 feet on the way to planned total depth of 11,500 feet in the far northwestern portion of our land position. � We have logged the well at this depth and results are encouraging. � The well is scheduled to be hydraulically fractured on April 4-5, 2011.

Based on the results achieved to date, we expect to achieve a sustained gross Harvest-operated production rate in excess of approximately 1,000 BOPD when the above-mentioned seven wells are all producing routinely in April 2011.

In addition to the above-mentioned wells, we have built locations, drilled surface hole, and set surface casing in two additional wells, the Lamb 1-19-3-1 and the Yergensen 1-18-3-1. � Both of these wells are being incorporated in our planning for the next round of development drilling in the Lower Green River/Upper Wasatch. � We have identified and prioritized our next 14 drilling locations which will represent the next phase of the drilling program when it is initiated.

We are also progressing with our permitting efforts on our 170 square mile wide azimuth 3-D Lower Green River/Upper Wasatch seismic survey anticipated to commence data acquisition in summer 2011. � To date, we have acquired 35 percent of the required landowner surface permits and have received our Utah State Division of Oil, Gas, Mining permit to acquire the data.

Monument Butte Extension Appraisal and Development Project

We are currently producing from 14 wells in the Monument Butte Extension project, including 13 wells operated by Newfield Exploration and one well operated by Harvest. � 

The 13 non-operated wells have now produced approximately 350,000 gross barrels of oil and 1.3 gross BCF of gas since inception of production in December 2009. � Current gross production from the 13 wells is approximately 500 BOPD and 8 MMCFD of gas gross. � The most recent well in the program, the Meagher 10-20-4-2, has produced approximately 8,000 gross barrels of oil and 8 gross MMCF of gas since inception of production in late December 2010. � The one remaining Newfield operated well in the approved program, the Stewart 1A-29-4-2, is currently drilling and is expected to be on production in March. � Harvest's average working interest in the 13 Newfield-operated wells is approximately 40 percent. � 

The Harvest-operated K Moon 2-13-4-3 well was spud in November 2009 and commenced production on February 16, 2011. � The well has exceeded initial production expectations by producing over 1,500 gross barrels of oil flowing in the first twelve days of production. � A pumping unit will be installed in the next few weeks. � This well is a significant step toward confirming the prospectivity of the Harvest operated acreage in the Monument Butte Extension project. � Harvest has an approximately 60 percent working interest in this well.

We have identified and prioritized approximately 50 Harvest-operated drilling locations which will represent the next phase of Monument Butte Extension drilling when it is initiated.

Comments on US Reserve Report

The reserve report for the Utah assets assumes a West Texas Intermediate crude oil price of $79.43 per barrel, which yields $64.45 per barrel wellhead netback after adjustment for location and quality and crude oil transportation cost. � Table 3 and 4 below provide an overview of the reserve data provided in the reserve report prepared by Ryder Scott. � It is important to note that the year-end 2010 reserve report from Ryder Scott reflects only those wells completed and produced prior to December 31, 2010. � As such, the drilling and testing results of the wells completed in 2011 have not been considered in the proved reserves category in the report.

Indonesia

The Lariang LG-1 well, the first of two planned exploration wells, was spud on January� 6, 2011 in the Budong-Budong Block, West Sulawesi. � The well has been drilled to a depth of 4,527 feet and has encountered multiple oil and gas shows within the secondary Miocene objective. Wireline logs, samples of reservoir fluid and pressure data have confirmed the presence of hydrocarbons and greatly de-risked the exploration potential of the license. Drilling operations have taken longer than anticipated due to a combination of mechanical failures on the rig and having encountered formations with higher pressures than expected. To control the well, the 12-1/4 inch hole was drilled with 15.8 pounds per gallon mud. Currently the 9-5/8 inch casing is being set after which the well will drill ahead to test the primary Eocene targets with a planned total measured depth of approximately 7,200 feet.

Dussafu Project - Gabon ("Dussafu PSC")

Plans for the drilling of the Ruche Marin-A exploration well have progressed with the aim to spud the well in April 2011. A Letter of Intent has been agreed with Transocean for a one well contract using the Sedneth 701 semi-submersible drilling unit and the rig contract is currently under negotiation. Long lead items (Casing and Subsea Wellhead) required for drilling have been purchased and have either arrived in country or are on route to Gabon. � An operational and logistics base has been established in Port Gentil. The Ruche Marin-A well will be drilled in a water depth of 380 feet to test multiple stacked pre-salt targets to a planned total measured depth of approximately 10,100 feet.

Reserves Disclosure

The proved, probable and possible reserves included herein were prepared by Ryder Scott and conform to the definitions as set forth in the Securities and Exchange Commission's (SEC) Regulations Part 210.4-10(a). The hydrocarbon prices used are based on SEC price parameters using the average prices during the 12-month period prior to the ending date of the reserve report, determined as the unweighted arithmetic averages of the prices in effect on the first-day-of-the-month for each month within such period, unless prices were defined by contractual arrangements. Reserves are "estimated remaining quantities of oil and gas and related substances anticipated to be economically producible, as of a given date, by application of development projects to known accumulations." � All reserve estimates involve an assessment of the uncertainty relating the likelihood that the actual remaining quantities recovered will be greater or less than the estimated quantities determined as of the date the estimate is made. � The uncertainty depends chiefly on the amount of reliable geologic and engineering data available at the time of the estimate and the interpretation of these data. � The relative degree of uncertainty may be conveyed by placing reserves into one of two principal classifications, either proved or unproved. � Unproved reserves are less certain to be recovered than proved reserves and may be further sub-classified as probable and possible reserves to denote progressively increasing uncertainty in their recoverability. � 

Proved oil and gas reserves are those quantities of oil and gas which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible from a given date forward. � If deterministic methods are used, the SEC has defined reasonable certainty for proved reserves as a "high degree of confidence that the quantities will be recovered." � Probable reserves are "those additional reserves that are less certain to be recovered than proved reserves but which, together with proved reserves, are as likely as not to be recovered." � Possible reserves are "those additional reserves which are less certain to be recovered than probable reserves" and thus the probability of achieving or exceeding the proved plus probable plus possible reserves is low.

The reserves included herein were estimated using deterministic methods and presented as incremental quantities. � Under the deterministic incremental approach, discrete quantities of reserves are estimated and assigned separately as proved, probable or possible based on their individual level of uncertainty. � Because of the differences in uncertainty, caution should be exercised when aggregating quantities of oil and gas from different reserves categories. � Furthermore, the reserves and income quantities attributable to the different reserve categories that are included herein have not been adjusted to reflect these varying degrees of risk associated with them and thus are not comparable.

Reserve estimates will generally be revised only as additional geologic or engineering data become available or as economic conditions change. � For proved reserves, the SEC states that "as changes due to increased availability of geoscience (geological, geophysical, and geochemical), engineering, and economic data are made to the estimated ultimate recovery (EUR) with time, reasonably certain EUR is much more likely to increase or remain constant than to decrease." � Moreover, estimates of proved, probable and possible reserves may be revised as a result of future operations, effects of regulation by governmental agencies or geopolitical or economic risks. � Therefore, the proved, probable and possible reserves included in this report are estimates only and should not be construed as being exact quantities, and if recovered, the revenues there from, and the actual costs related thereto, could be more or less than the estimated amounts.

About Harvest Natural Resources

Harvest Natural Resources, Inc., headquartered in Houston, Texas, is an independent energy company with principal operations in Venezuela, producing and exploration assets in the United States, exploration assets in Indonesia, West Africa, China and Oman and business development offices in Singapore and the United Kingdom. For more information visit the Company's website at www.harvestnr.com.

This press release may contain projections and other 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. They include estimates and timing of expected oil and gas production, oil and gas reserve projections of future oil pricing, future expenses, planned capital expenditures, anticipated cash flow and our business strategy. All statements other than statements of historical facts may constitute forward-looking statements. Although Harvest believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Actual results may differ materially from Harvest's expectations as a result of factors discussed in Harvest's 2009 Annual Report on Form 10-K and other public filings.

SOURCE Harvest Natural Resources