10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-K

(Mark One)

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2013

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File No.: 1-10762

HARVEST NATURAL RESOURCES, INC.

(Exact name of registrant as specified in its charter)

Delaware	77-0196707
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)
1177 Enclave Parkway, Suite 300 Houston, Texas	77077
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (281) 899-5700

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Stock, $.01 Par Value	NYSE

Securities registered pursuant to Section 12(g) of the Act: Preferred Share Purchase Rights

Indicate by check mark whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ¨    No  x

Indicate by check mark whether the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  ¨    No  x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer	¨	Accelerated Filer	x
Non-Accelerated Filer	¨	Smaller Reporting Company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     Yes  ¨    No  x

The aggregate market value of the registrant’s voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of June 28, 2013 was: $122,116,759.

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practical date. Class: Common Stock, par value $0.01 per share, on March 7, 2014, shares outstanding: 42,104,038.

DOCUMENTS INCORPORATED BY REFERENCE

An amendment to this Annual Report on Form 10-K to be filed with the Securities and Exchange Commission not later than 120 days after the close of the Registrant’s fiscal year, is incorporated by reference under Part III of this Form 10-K.

HARVEST NATURAL RESOURCES, INC.

FORM 10-K

TABLE OF CONTENTS

		Page
Part I
Item 1.	Business		1
Item 1A.	Risk Factors		21
Item 1B.	Unresolved Staff Comments		30
Item 2.	Properties		30
Item 3.	Legal Proceedings		30
Item 4.	Mine Safety Disclosures		32
Part II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		33
Item 6.	Selected Financial Data		35
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		36
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk		58
Item 8.	Financial Statements and Supplementary Data		58
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		58
Item 9A.	Controls and Procedures		59
Item 9B.	Other Information		60
Part III
Item 10.	Directors, Executive Officers and Corporate Governance		61
Item 11.	Executive Compensation		61
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		61
Item 13.	Certain Relationships and Related Transactions, and Director Independence		61
Item 14.	Principal Accountant Fees and Services		61
Part IV
Item 15.	Exhibits and Financial Statement Schedules		62
Signatures			S-60
Financial Statements			S-4

PART I

Harvest Natural Resources, Inc. (“Harvest” or the “Company”) cautions that any forward-looking statements as such term is defined in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) contained in this report or made by management of the Company involve risks and uncertainties and are subject to change based on various important factors. When used in this report, the words “budget”, “forecast”, “expect”, “believes”, “goals”, “projects”, “plans”, “anticipates”, “estimates”, “should”, “could”, “assume” and similar expressions are intended to identify forward-looking statements. In accordance with the provisions of the Securities Act and the Exchange Act, we caution you that important factors could cause actual results to differ materially from those in any forward-looking statements. These factors include our concentration of operations in Venezuela; political and economic risks associated with international operations (particularly those in Venezuela); anticipated future development costs for undeveloped reserves; drilling risks; risk that actual results may vary considerably from reserve estimates; the dependence on the abilities and continued participation of our key employees; risks normally incident to the exploration, operation and development of oil and natural gas properties; risks incumbent to being a noncontrolling interest shareholder in a corporation; permitting and drilling of oil and natural gas wells; availability of materials and supplies necessary to projects and operations; prices for oil and natural gas and related financial derivatives; changes in interest rates; our ability to acquire oil and natural gas properties that meet our objectives; availability and cost of drilling rigs and seismic crews; overall economic conditions; political stability; civil unrest; acts of terrorism; currency and exchange risks; currency controls; changes in existing or potential tariffs, duties or quotas; changes in taxes; changes in governmental policy; lack of liquidity; availability of sufficient financing; estimates of amounts and timing of sales of securities; changes in weather conditions; and ability to hire, retain and train management and personnel. See Item 1A. Risk Factors and Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Item 1. Business

Executive Summary

Harvest Natural Resources, Inc. is a petroleum exploration and production company incorporated under Delaware law in 1989. Our focus is on acquiring exploration, development and producing properties in geological basins with proven active hydrocarbon systems. Our experienced technical, business development and operating personnel have identified low entry cost exploration opportunities in areas with large hydrocarbon resource potential. We acquired and developed significant interests in the Bolivarian Republic of Venezuela (“Venezuela”). In addition to our interests in Venezuela, we hold exploration acreage mainly offshore of Gabon, onshore West Sulawesi in Indonesia and offshore of the People’s Republic of China (“China”). We operate from our Houston, Texas headquarters. We also have regional/technical offices in Singapore and field offices in Port Gentil, Republic of Gabon (“Gabon”) and Jakarta, Republic of Indonesia (“Indonesia”) to support field operations in those areas.

During the last several years, we have been exploring a broad range of strategic alternatives for enhancing and realizing stockholder value. In September 2010, we retained Merrill Lynch, Pierce, Fenner & Smith (“Merrill Lynch”) to provide advisory services to assist us in exploring those strategic alternatives, including, among others, a sale of assets. We received several indications of interest from third parties, provided due diligence materials to third parties under confidentiality agreements and had preliminary discussions with third parties regarding a sale of our interests in Venezuela.

In June 2012 we entered into an agreement with PT Pertamina (Persero), a state-owned limited liability company existing under the laws of the Republic of Indonesia (“Pertamina”), to sell all of our interests in Venezuela for a cash consideration of $725 million, subject to certain price adjustments. The sale to Pertamina was conditioned on, among other things, the approval of the Ministerio del Poder Popular de Petroleo y Mineria, representing the Government of Venezuela (which indirectly owns 60 percent of Petrodelta) and the approval of

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Pertamina’s shareholder, the Government of the Republic of Indonesia. After receiving notice from Pertamina in February 2013 that Pertamina’s shareholder had decided not to approve the transaction, we exercised our right to terminate the agreement in accordance with its terms.

After the termination of the Pertamina transaction, we continued to consider our strategic alternatives. We received several indications of interest from third parties, provided due diligence materials to third parties under confidentiality agreements and had preliminary discussions with third parties regarding a sale of our interests in Venezuela. As discussed below, on December 16, 2013, we entered into an agreement to sell all of our interests in Venezuela to Petroandina Resources Corporation N.V. (“Petroandina”, a wholly owned subsidiary of Pluspetrol Resources Corporation B.V. (“Pluspetrol”)) in two closings for an aggregate cash purchase price of $400 million.

Our Venezuelan interests are owned through Harvest-Vinccler Dutch Holding, B.V., a Dutch private company with limited liability (“Harvest Holding”). Harvest Holding owns 100 percent of HNR Finance, B.V. (“HNR Finance”), and HNR Finance owns a 40 percent interest in Petrodelta, S.A. (“Petrodelta”).

Our ownership of Harvest Holding is through HNR Energia, B.V. (“HNR Energia”) in which we have a direct controlling interest. Prior to December 16, 2013, we indirectly owned 80 percent of Harvest Holding, and we had one partner, Oil & Gas Technology Consultants (Netherlands) Coöperatie U.A., (“Vinccler”, a controlled affiliate of Venezolana de Inversiones y Construcciones Clerico, C.A.), which owned the remaining noncontrolling interest in Harvest Holding of 20 percent. We do not have a business relationship with Vinccler outside of Venezuela. On December 16, 2013, Harvest and HNR Energia entered into a Share Purchase Agreement (“Share Purchase Agreement”) with Petroandina and Pluspetrol to sell all of our 80 percent equity interest in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement, when we sold a 29 percent equity interest in Harvest Holding for $125 million. This first transaction resulted in a loss on the sale of the interest in Harvest Holding of $23.0 million in the year ended December 31, 2013. The second closing, for a cash purchase price of $275 million, will be subject to, among other things, authorization by the holders of a majority of the Company’s outstanding common stock and approval by the Ministerio del Poder Popular de Petroleo y Mineria representing the Government of Venezuela (which indirectly owns the other 60% interest in Petrodelta). As a result of this first sale, we indirectly own 51 percent of Harvest Holding beginning December 16, 2013 and the noncontrolling interest owners hold the remaining 49 percent with Petroandina having a 29 percent interest and Vinccler continuing to own a 20 percent interest. See Share Purchase Agreement below for further information on this transaction.

Corporación Venezolana del Petroleo S.A. (“CVP”) and PDVSA Social S.A. own the remaining 56 percent and 4%, respectively, of Petrodelta. Petroleos de Venezuela S.A. (“PDVSA”) owns 100 percent of CVP and PDVSA Social S.A. Through our indirect 51 percent in Harvest Holding, we indirectly own a net 20.4 percent interest in Petrodelta for the period from December 16, 2013 to date. Prior to December 16, 2013 we indirectly owned a 32 percent interest in Petrodelta through our indirect 80 percent interest in Harvest Holding during this period. In addition to its 40 percent interest in Petrodelta, Harvest Holding also indirectly owns 100 percent of Harvest Vinccler S.C.A. (“Harvest Vinccler”). Harvest Vinccler’s main business purposes are to assist us in the management of Petrodelta and in negotiations with PDVSA.

As of December 31, 2013, we had total assets of $734.9 million, unrestricted cash of $120.9 million and debt of $83.6 million. For the year ended December 31, 2013, we had no revenues from continuing operations and net cash used in operating activities of $37.1 million. As of December 31, 2012, we had total assets of $596.8 million, unrestricted cash of $72.6 million and long-term debt of $74.8 million. For the year ended December 31, 2012, we had no revenues from continuing operations and net cash used in operating activities of $26.4 million.

At December 31, 2013, Petrodelta’s reserves net to our 20.4 percent interest are: Proved reserves 20.7 million barrels of oil equivalent (“MMBOE”), Probable reserves 41.5 MMBOE, and Possible reserves 62.9 MMBOE. Proved plus Probable reserves at 62.2 MMBOE, after accounting for the reduction in our interest from 32.0 percent to 20.4 percent, are virtually

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unchanged from last year. See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, Critical Accounting Policies – Reserves for a definition of proved, probable and possible reserves and a discussion of the uncertainty related to such reserve estimates. Barrels of oil equivalent is determined using the approximate heat content ratio of one barrel of crude oil or condensate to six thousand cubic feet (“Mcf”) of natural gas, which ratio does not necessarily reflect price equivalency.

Share Purchase Agreement

On December 16, 2013, Harvest and HNR Energia entered into the Share Purchase Agreement with Petroandina and Pluspetrol, its parent, to sell all of our Venezuelan interests through the sale of our equity interests in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred contemporaneously with the signing of the Share Purchase Agreement. At that time, HNR Energia sold to Petroandina, for a cash price of $125.0 million, a 29 percent equity interest in Harvest Holding (which we refer to as the “first closing”), which represents an indirect 11.6 percent equity interest in Petrodelta. This first transaction resulted in a loss on the sale of the interest in Harvest Holding of $23.0 million in the year ended December 31, 2013. As a result of this first sale, we indirectly own 51 percent of Harvest Holding beginning December 16, 2013 and the noncontrolling interest owners hold the remaining 49 percent with Petroandina having a 29 percent interest and Vinccler continuing to own a 20 percent interest. We will continue to consolidate Harvest Holding’s results until the sale of the remaining 51 percent interest has been completed. The second closing will be for the sale of HNR Energia’s remaining 51 percent equity interest in Harvest Holding, which represents an indirect 20.4 percent equity interest in Petrodelta, for a cash purchase price of $275 million payable at closing (which we refer to as the “second closing”). The second closing will be subject to, among other things, authorization by the holders of a majority of our outstanding common stock and approval by the Government of the Bolivarian Republic Venezuela (which indirectly owns the other 60 percent interest in Petrodelta).

HNR Energia and Petroandina also entered into a Shareholders’ Agreement (the “Shareholders’ Agreement”) on December 16, 2013, regarding the shares of Harvest Holding. The Shareholders’ Agreement becomes effective upon any termination of the Share Purchase Agreement before the second closing of the sale of the remaining shares of Harvest Holding.

If the Share Purchase Agreement is terminated because of the failure to obtain authorization by our stockholders, we will be required to pay Petroandina a fee of $3.0 million, and Petroandina will have the right to sell back to HNR Energia the shares of Harvest Holding purchased at the first closing (the “First Closing Shares”).

We have agreed not to solicit other offers to acquire our Petrodelta assets or the Company as a whole while the Share Purchase Agreement is in effect. If we receive an unsolicited acquisition proposal (as defined in the Share Purchase Agreement) before our stockholders have approved the sale of our remaining Venezuelan interests, we may enter into discussions with the potential purchaser if our Board of Directors determines, in good faith, after consultation with our outside legal counsel and financial advisors, that such acquisition proposal is reasonably likely to result in a superior proposal (as hereinafter defined). We have the right to terminate the Share Purchase Agreement and accept a superior proposal if we first offer Petroandina the opportunity to modify the terms of the Share Purchase Agreement so that the competing offer is no longer superior and, concurrently with such termination, we pay Petroandina a break-up fee equal to $9.6 million and enter into an alternative acquisition agreement with respect to such superior proposal.

If the Share Purchase Agreement is terminated because we or HNR Energia accept a superior proposal, Petroandina has the right to sell back to HNR Energia, and HNR Energia has the right to cause Petroandina to sell back to HNR Energia, the First Closing Shares, and we will be required to pay Petroandina a breakup fee of $9.6 million.

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Certain conditions must be satisfied before consummation of the proposed sale of our remaining Venezuelan interests, including authorization of the sale by the holders of a majority of the outstanding shares of our common stock entitled to vote at the special meeting and approval of the sale from the Ministerio del Poder Popular de Petroleo y Mineria representing the Government of Venezuela.

The Share Purchase Agreement may, by written notice given before or at the second closing, be terminated, among other reasons, if our stock holders do not authorize the proposed sale, if we or Petroandina breach certain representations, warranties or covenants, if we accept a superior proposal and pay a breakup fee or if any other closing condition is not satisfied or waived.

We must pay a termination fee of $9.625 million, or 3.5 percent of the $275 million purchase price payable at the second closing, in cash to Petroandina if the Share Purchase Agreement is terminated in certain circumstances, including our acceptance of a superior proposal. If the Share Purchase Agreement is terminated as a result of the failure of our stockholders to approve the proposed sale, we must pay a fee of $3 million in cash to Petroandina. We must also pay the reasonable out-of-pocket expenses of Petroandina incurred in connection with the Share Purchase Agreement, up to $4 million, if the Share Purchase Agreement is terminated as a result of our breach of a representation or warranty upon execution of the Share Purchase Agreement or our breach of a covenant.

Petroandina has the right and option to sell to HNR Energia, and to cause HNR Energia to purchase, the First Closing Shares, on termination of the Share Purchase Agreement in certain circumstances. HNR Energia has the right and option to purchase from Petroandina, and to cause Petroandina to sell, the First Closing Shares, on termination of the Share Purchase Agreement in certain other circumstances.

We have agreed to indemnify Petroandina and its affiliates from and against losses arising out of our and HNR Energia’s breaches of representations and warranties (deemed made without any qualification as to materiality or material adverse effect) or failure to perform or comply with covenants in the Share Purchase Agreement, subject to certain limitations.

We guaranteed HNR Energia’s obligations under the Share Purchase Agreement and the Shareholders’ Agreement.

During the term of the Share Purchase Agreement, Harvest Holding may not pay any dividends to HNR Energia, and therefore would not benefit from any dividends paid by Petrodelta during this period.

Approval of the second closing will be submitted to the Company’s stockholders for their consideration, and the Company will file a definitive proxy statement to be used to solicit stockholder approval of the second closing with the Securities and Exchange Commission (“SEC”). The Company’s stockholders are urged to read the proxy statement regarding the transaction when it becomes available and any other relevant documents filed with the SEC, as well as any amendments or supplements to those documents, because they will contain important information. A free copy of the proxy statement, as well as other filings with the SEC containing information about the Company and the transaction may be obtained, when available, at the SEC’s website at www.sec.gov. Copies of the proxy statement may also be obtained, when available, without charge, by directing a request to Harvest Natural Resources, Inc., Investor Relations, 1177 Enclave Parkway, Suite 300, Houston, Texas 77077 or at the Company’s Investor Relations page on its corporate website at www.harvestnr.com. The Company, its directors and executive officers and Morrow & Co., LLC may be deemed to be participants in the solicitation of proxies from the Company’s stockholders in connection with the approval of the second closing.

Recent Events

In January 2013, we announced that we had encountered oil in Dussafu Tortue Marin-1 (“DTM-1”) in Gabon. In February 2013, we announced that we had drilled a sidetrack well (“DTM-1ST1”) to test the lateral extent of the reservoirs encountered. See “Item 1. Business, Operations, Dussafu Marin, Offshore Gabon – Drilling and Development Activity”.

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In January 2013, we acquired an additional 7.1 percent participating interest in the Budong-Budong Production Sharing Contract (“Budong PSC”) and became operator of the Budong PSC in March 2013. If we do not drill an exploration well before October 2014, our partner has the right to give us notice that the consideration for the additional 7.1 percent participating interest must be paid in cash for $3.2 million. See “Item 1. Business, Operations, Budong-Budong, Onshore Indonesia – General.”

In February 2013, we signed farm-out agreements on Block VSM14 and Block VSM15 in Colombia. We have received notices of default from our partners for failing to comply with certain terms of the farmout agreements for Block VSM 14 and Block VSM 15, followed by notices of termination on November 27, 2013. As discussed further in “Item 3. Legal Proceedings”, our partners have filed for arbitration of claims related to these agreements. After evaluating these circumstances, we determined that it was appropriate to fully impair the costs associated with these interests, and we recorded an impairment charge of $3.2 million during the year ended December 31, 2013. As we no longer have any interests in Colombia, we have reflected the results in discontinued operations. See “Item 1. Business – Operations, Colombia”.

In February 2013, we announced that the agreement between Pertamina and HNR Energia entered into in June 2012 for the purchase of Harvest’s interests in Venezuela had been terminated as a result of the Government of Indonesia, in its capacity as sole shareholder of Pertamina, voting not to approve the transaction.

In March 2013, we elected to not request an extension of the first phase or enter the second phase of Block 64 EPSA in Oman, and Block 64 was relinquished effective May 23, 2013. The carrying value of Block 64 EPSA of $6.4 million was considered to be impaired and a related impairment expense was recorded during the year ended December 31, 2012. During the first half of 2013, we terminated operations in Oman and closed the field office. Our activities in Oman have been reflected as discontinued operations in our financial statements.

On September 30, 2013, we entered into a subscription agreement under which we agreed to sell to three purchasers an aggregate of 390,000 shares of our common stock for an aggregate purchase price of $2,000,700. The transaction closed on October 1, 2013.

On October 2, 2013, we entered into subscription agreements under which we agreed to sell to three purchasers an aggregate of 400,000 shares of our common stock for an aggregate purchase price of $1,928,000. The transactions closed on October 4, 2013.

In November 2013, we entered into subscription agreements under which we agreed to sell to 12 purchasers an aggregate of 1,704,800 shares of common stock for an aggregate purchase price of $5,370,120. The purchasers included six Harvest officers and directors, who purchased an aggregate of 246,000 shares of common stock for an aggregate purchase price of $774,900. The transactions closed on November 27, 2013.

As discussed above, on December 16, 2013, we and HNR Energia entered into the Share Purchase Agreement with Petroandina and Pluspetrol to sell all of our Venezuelan interests through the sale of our equity interests in Harvest Holding.

On January 11, 2014, we used a portion of the $125 million in proceeds from the first closing sale to Petroandina to redeem all of our 11% Senior Notes due 2014. The notes were redeemed for $80.0 million, including principal and accrued and unpaid interest. As a result of the redemption, we recorded a loss on extinguishment of debt of approximately $3.6 million in January 2014. This loss primarily includes the write off of the discount on debt ($2.3 million) and the expensing of the related financing costs ($1.3 million).

See Item 1. Business, Operations, Item 1A. Risk Factors, and Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations for a more detailed description of these and other events during 2013 and through the date of filing this Annual Report on Form 10-K.

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Business Strategy

In Operations, Petrodelta below, Item 1A. Risk Factors and Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, we discuss the situation in Venezuela and how the actions of the Venezuelan government have and continue to adversely affect our operations. The expectation that dividends from Petrodelta will be minimal over the next few years restricted our available cash and had a significant adverse effect on our ability to obtain financing to acquire and develop growth opportunities elsewhere. As discussed above, on December 16, 2013, Harvest and HNR Energia entered into the Share Purchase Agreement with Petroandina and Pluspetrol to sell all of our 80 percent equity interest in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement. The second closing will be subject to, among other things, approval by the holders of a majority of our common stock and approval by the Ministerio del Poder Popular de Petroleo y Mineria representing the Government of Venezuela (which indirectly owns the other 60 percent interest in Petrodelta). See Share Purchase Agreement above.

As discussed above, on January 11, 2014, we used $80.0 million of the $125 million in proceeds from the first closing that we received on December 16, 2013, to redeem all of our 11% Senior Notes due 2014. The remaining $45.0 million of the proceeds from the first closing have been or will be used to pay costs associated with the sale of our Venezuelan interests, to pay severance costs, to make capital expenditures, to pay taxes related to the sale and for general operating expenses. Those remaining proceeds will also be used to repurchase certain outstanding warrants if our stockholders approve the sale of our remaining Venezuelan interests, and if a “Fundamental Change” is consummated under the terms of those warrants.

We are currently marketing our non-Venezuelan assets and talking to potential buyers, and we intend to continue our consideration of a possible sale for some or all of our non-Venezuelan assets if we are able to negotiate a sale or sales in transactions that our Board of Directors believes are in the best interests of the Company and its stockholders. In the meantime, we intend to operate our business in the ordinary course and may ultimately decide to keep our non-Venezuelan assets and acquire additional assets.

If the proposed sale of our remaining Venezuelan interests is completed, a significant portion of our assets will be cash from the proceeds of such transaction. Sales of other non-Venezuelan assets would further increase the portion of our assets that is in cash from the proceeds of such sales. The timing of the second closing is beyond the control of the Company. Operating and capital requirements related to the portfolio of retained assets at the time of the sales will influence the determination by our Board of Directors of the size of any cash distribution to the stockholders from the proceeds of such sales. For clarity, the possible sale of non-Venezuelan assets before the second closing sale would diminish the need for the Company to retain proceeds from the second closing. Depending on the timing of these events, we anticipate using a portion of the proceeds from the second closing to pay for expenses and other costs related to the transaction, which we estimate will be approximately $4 million and to pay taxes related to the transaction, which we estimate will be approximately $51.1 million. In addition, if we do not sell our non-Venezuelan assets before the second closing, then we estimate that we will need to retain approximately $30 million to fund projected general operating expenses and capital expenditures through December 31, 2014 (to the extent that those general operating expenses are not already reserved from any possible sale of our non-Venezuelan assets). Some of these costs will be paid from funds remaining from the proceeds of the first closing. If we sell our non-Venezuelan assets before the second closing, then we estimate that we will need to retain approximately $20 million to fund projected general operating expenses and capital expenditures through December 31, 2014 (to the extent that those general operating expenses are not already reserved from any possible sale of our non-Venezuelan assets). Some of these costs will be paid from funds remaining from the proceeds of the first closing. We will also use these funds to pay any severance or other costs during 2014 associated with the possible severance of some of our personnel in connection with a downsizing of the Company both related to the sale of our Venezuelan interests and related to any sale of our non-Venezuelan assets, if our Board of Directors determines that a downsizing would be in the best interest of the Company and its shareholders. We estimate these costs to be approximately $20 million.

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We will use the remainder of the proceeds as our Board of Directors, in its discretion, determines, based on its determination of what is in the best interests of the Company and its stockholders at the time a decision is made. In addition to the possibility that our Board of Directors may use part of the proceeds to pay a dividend to our stockholders, it is also possible that our Board of Directors may use part of the proceeds to continue the Company’s business. Before making any decisions with respect to paying a dividend to Harvest’s stockholders, our Board of Directors will also need to consider the possible need to provide for retention of funds for contingent obligations relating to any lawsuits or other claims that may exist at the time that the Board of Directors considers these matters. For a description of our non-Venezuelan assets and operations, see “Operations – Dussafu Marin, Offshore Gabon,” “Operations – Budong-Budong, Onshore Indonesia” and “Operations – WAB-21, South China Sea.”

Although we are currently marketing our non-Venezuelan assets and talking to potential buyers, we will continue to operate our business in the ordinary course and may ultimately decide to keep our non-Venezuelan assets and acquire additional assets. Since we no longer have any obligations under the 11% Senior Notes due 2014, and given that we do not currently have any operating cash flow, we may also decide to access additional capital through equity or debt sales. After the sale, we would continue to be a reporting company under SEC regulations and would continue to file reports required by those regulations, including Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Through these reports and other public announcements, we will update our strategy and plans for use of the proceeds from the sale of our remaining Venezuelan interests. We also currently expect that our common stock will continue to be traded on the New York Stock Exchange or another appropriate exchange as long as we meet applicable listing requirements.

Available Information

We file annual, quarterly and current reports, proxy statements and other documents with the SEC under the Securities Exchange Act of 1934 (“Exchange Act”). The public may read and copy any materials that we file with the SEC at the SEC’s Public Reference Room at 100 F Street NE, Washington, DC 20549-0213. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. Also, the SEC maintains an Internet website that contains reports, proxy and information statements, and other information regarding issuers, including us, that file electronically with the SEC. The public can obtain any documents that we file with the SEC at http://www.sec.gov.

We also make available, free of charge on or through our Internet website (http://www.harvestnr.com), our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and if applicable, amendments to those reports filed or furnished pursuant to Section 13(a) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. Forms 3, 4 and 5 filed with respect to our equity securities under Section 16(a) of the Exchange Act are also available on our website. In addition, we have adopted a Code of Business Conduct and Ethics that applies to all of our employees, including our chief executive officer, principal financial officer and principal accounting officer. The text of the Code of Business Conduct and Ethics has been posted on the Corporate Governance section of our website. We post on our website any amendments to, or waivers from, our Code of Business Conduct and Ethics applicable to our senior officers. Additionally, the Code of Business Conduct and Ethics is available in print to any person who requests the information. Individuals wishing to obtain this printed material should submit a request to Harvest Natural Resources, Inc., 1177 Enclave Parkway, Suite 300, Houston, Texas 77077, Attention: Investor Relations.

Reserves

We measure and disclose our oil and gas reserves in accordance with the provisions of the SEC’s Modernization of Oil and Gas Reporting and ASC 932, “Extractive Activities – Oil and Gas” (“ASC 932”). See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, Critical Accounting Policies – Reserves for a definition of proved, probable and possible reserves and a discussion of the uncertainty related to such reserve estimates.

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The process for preparation of our oil and gas reserves estimates is completed in accordance with our prescribed internal control procedures, which include verification of data provided, management reviews and review of the independent third party reserves report. The technical employee responsible for overseeing the process for preparation of the reserves estimates has a Bachelor of Arts in Engineering Science, a Master of Science in Petroleum Engineering, more than 33 years of experience in reservoir engineering, and is a member of the Society of Petroleum Engineers.

All reserve information in this report is based on estimates prepared by Ryder Scott Company L.P. (“Ryder Scott”), independent petroleum engineers. The technical personnel responsible for preparing the reserve estimates at Ryder Scott meet the requirements regarding qualifications, independence, objectivity and confidentiality set forth in the Standards Pertaining to the Estimating and Auditing of Oil and Gas Reserves Information promulgated by the Society of Petroleum Engineers. Ryder Scott is an independent firm of petroleum engineers, geologists, geophysicists and petrophysicists; they do not own an interest in our properties and are not employed on a contingent fee basis.

In Venezuela during 2013, Petrodelta drilled and completed 13 production wells. Eleven of the wells were previously identified as Proved Undeveloped (“PUD”) locations and two wells were previously classified as probable, possible or undefined locations. In 2013, an additional ten PUD locations were identified through drilling activity, however ten PUD locations which are scheduled to be drilled five years after the wells were originally identified have been reclassified as Probable reserves. At December 31, 2013, Petrodelta has 133 identified PUD locations.

Petrodelta’s 2013 business plan, as proposed by Petrodelta, contemplates sustained drilling activities through the year 2023 to fully develop the El Salto, Isleño and Temblador fields. As a noncontrolling interest shareholder in Petrodelta, HNR Finance, a wholly owned subsidiary of Harvest Holding, has limited ability to control the development plans that are periodically prepared and/or approved by the Venezuelan government. The PUD locations which are now scheduled to be drilled five years after they were originally identified have been reclassified as Probable reserves.

Proved undeveloped reserves of 10.6 MMBOE from 133 gross PUD locations are scheduled to be drilled within the period from 2014 to 2017 and within five years from when these locations were first identified. All above MMBOE represent our net 20.4 percent interest, net of a 33.33 percent royalty.

Probable undeveloped reserves of 41.5 MMBOE include 14.0 MMBOE from 108 gross undeveloped locations that would otherwise meet the definition of proved undeveloped reserves, except that they are scheduled to be drilled at least five years after the date that they were originally identified. All of these 108 locations are scheduled to be drilled within five years from 2014 to 2019.

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The following table shows, by country and in the aggregate, a summary of our proved, probable and possible oil and gas reserves as of December 31, 2013.

	Oil and NGLs (c)		Natural Gas		Total
	(MBls) (a)		(MMcf) (a)		(MBOE) (a)
Proved Developed Reserves:
International – Venezuela (b)		8,382		10,430		10,121
Total Proved Developed		8,382		10,430		10,121
Proved Undeveloped Reserves:
International – Venezuela (b)		10,192		2,216		10,561
Total Proved Undeveloped		10,192		2,216		10,561
Total Proved Reserves		18,574		12,646		20,682
Probable Developed Reserves:
International – Venezuela (b)		0		0		0
Total Probable Developed		0		0		0
Probable Undeveloped Reserves:
International – Venezuela (b)		37,344		25,099		41,527
Total Probable Undeveloped		37,344		25,099		41,527
Total Probable Reserves		37,344		25,099		41,527
Possible Developed Reserves:
International – Venezuela (b)		0		0		0
Total Possible Developed		0		0		0
Possible Undeveloped Reserves:
International – Venezuela (b)		60,144		16,536		62,900
Total Possible Undeveloped		60,144		16,536		62,900
Total Possible Reserves		60,144		16,536		62,900

^(a)  “MBls”– thousand barrels of oil, “Mcf” – thousand cubic feet of natural gas, “MMcf”– thousand “Mcf” and MBOE – thousand barrels of oil equivalent. MBOE is determined using the approximate heat content ratio of one barrel of crude oil or condensate to six Mcf of natural gas, which ratio does not necessarily reflect price equivalency.

^(b)  Information represents our net 20.4 percent ownership interest in Petrodelta.

^(c)  “NGL”– Natural gas liquids.

Our estimates of proved reserves, proved developed reserves and proved undeveloped reserves as of December 31, 2013, 2012 and 2011 and changes in proved reserves during the last three years are contained in Item 15. Supplemental Information on Oil and Natural Gas Producing Activities (unaudited). See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operation, Critical Accounting Policies – Reserves for additional information on our reserves.

Operations

As of December 31, 2013, our operations include:

• Venezuela. Operations are through our equity affiliate Petrodelta which is governed by the Contract of Conversion (“Conversion Contract”) signed on September 11, 2007. Our ownership of Petrodelta is

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through Harvest Holding which indirectly, through wholly owned subsidiaries, owns 40 percent of Petrodelta. As we indirectly own 51 percent of Harvest Holding, we indirectly own a net 20.4 percent interest in Petrodelta.

• Republic of Gabon (“Gabon”). Operations are offshore of Gabon through the Dussafu PSC. We have a 66.667 percent interest in the Dussafu PSC. We are the operator.

• Republic of Indonesia (“Indonesia”). Operations are mainly onshore in West Sulawesi in Indonesia through the Budong PSC. We own a 71.5 percent cost sharing interest in the Budong PSC. We became the operator in March 2013.

• People’s Republic of China (“China”). Exploration acreage is offshore of China in the South China Sea through the WAB-21 Petroleum Contract (“WAB-21”). We have a 100 percent interest in the WAB-21 petroleum contract. We are the operator.

Petrodelta

General

On October 25, 2007, the Venezuelan Presidential Decree which formally transferred to Petrodelta the rights to the Petrodelta Fields subject to the conditions of the Conversion Contract was published in the Official Gazette, the official government publication where laws, decrees, resolutions, instructions, and other regulations of general interest issued by the central government of Venezuela are published in order to make those acts valid and official. Petrodelta is to undertake the exploration, production, gathering, transportation and storage of hydrocarbons from the Petrodelta Fields for a maximum of 20 years from that date. Petrodelta is governed by its own charter and bylaws. Petrodelta’s portfolio of properties in eastern Venezuela includes large proven oil fields as well as properties with very substantial opportunities for both development and exploration. We have seconded key technical and managerial personnel into Petrodelta and participate on Petrodelta’s board of directors.

Petrodelta’s shareholders intend that the company be self-funding and rely on internally-generated cash flow to fund operations. Under its conversion contract, work programs and annual budgets adopted by Petrodelta must be consistent with Petrodelta’s business plan. Petrodelta’s business plan may be modified by a favorable decision of the shareholders owning at least 75 percent of the shares of Petrodelta. Petrodelta’s approved capital budget for 2013 was $210 million and included a drilling program to use five drilling rigs for both development and appraisal wells to maintain production capacity. Petrodelta’s actual capital expenditures for 2013 were $269.2 million, and exceeded the budget as a result of cost overruns and inefficiencies.

PDVSA, as administrator of certain operating contracts for several mixed companies in Venezuela, has failed to pay on a timely basis certain amounts owed to contractors doing work for Petrodelta. PDVSA purchases all of Petrodelta’s oil production. PDVSA and its affiliates have reported shortfalls in meeting their cash requirements for operations and planned capital expenditures. In addition, PDVSA has fallen behind in certain of its payment obligations to Petrodelta, which payments Petrodelta would otherwise use to pay its contractors, including Harvest Holding. As a result, Petrodelta has experienced, and is continuing to experience, difficulty in retaining contractors who provide services for Petrodelta’s operations. We cannot provide any assurance as to whether or when PDVSA will become current on its payment obligations. Inability to retain contractors or to pay them on a timely basis has an adverse effect on Petrodelta’s operations and on Petrodelta’s ability to carry out its business plan.

Crude oil delivered from Uracoa, Bombal, Tucupita, Isleño and Temblador fields of Petrodelta to PDVSA Petroleo S.A. (“PPSA”), a wholly owned subsidiary of PDVSA, is priced with reference to Merey 16 published prices, weighted for different markets and adjusted for variations in gravity and sulphur content, commercialization costs and distortions that may occur given the reference price and prevailing market conditions. Merey 16 published prices are quoted and sold in U.S. Dollars. The crude oil produced and delivered from El Salto field is priced with reference to Boscan, a heavier 10 degree API crude oil, published prices, also weighted for different markets and quality adjusted as described above. Boscan published prices are also quoted and sold in U.S. Dollars. An amendment to Petrodelta’s Contract for Sale and Purchase of Hydrocarbons with PPSA (the “Sales Contract”) has been approved by Petrodelta’s shareholders and is awaiting execution. See

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, Operations, Petrodelta for additional information on Petrodelta’s Contract for Sale and Purchase of Hydrocarbons with PPSA. Natural gas delivered from the Petrodelta fields to PPSA is priced at $1.54 per Mcf. PPSA is obligated to make payment to Petrodelta in U.S. Dollars for crude oil and natural gas liquids delivered. Natural gas deliveries are paid in Venezuelan Bolivars (“Bolivars”), but the pricing for natural gas is referenced to the U.S. Dollar.

In April 2011, the Venezuelan government published in the Official Gazette the Law Creating a Special Contribution on Extraordinary Prices and Exorbitant Prices in the International Hydrocarbons Market (the “amended Windfall Profits Tax”). See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, Operations, Venezuela – Petrodelta for a discussion of the effects of the amended Windfall Profits Tax on Petrodelta’s business.

On November 12, 2010, Petrodelta’s board of directors declared a dividend of $30.6 million, $12.2 million net to HNR Finance. Petrodelta shareholder approval of the dividend was received on March 14, 2011. Due to Petrodelta’s liquidity constraints caused by PDVSA’s insufficient monetary support and contractual adherence, as of the date of this proxy statement, this dividend has not been received, although it is due and payable. Petrodelta’s board of directors declared this dividend and has never indicated that the dividend is not payable, or that it will not be paid. The dividend receivable is classified as a long-term receivable at December 31, 2013 due to the uncertainty in the timing of payment. There is uncertainty with respect to the timing of the receipt of this dividend and whether future dividends will be declared or paid. We continue to monitor our investment in Petrodelta. Should the dividend receivable not be collected or facts and circumstances surrounding our investment change, our results of operations and investment in Petrodelta could be adversely affected.

Petroandina has the right to any dividends paid by Harvest Holding after December 16, 2013, that would attach with respect to their current 29 percent interest and, after the second closing any dividends that would attach to the shares of Harvest Holding sold in that closing, regardless of whether the dividends are paid in connection with dividends paid by Petrodelta that are declared before, on or after the date of the Share Purchase Agreement and regardless of the record date therefor. During the term of the Share Purchase Agreement, Harvest Holding may not pay any dividends to HNR Energia, and therefore would not benefit from any dividends paid by Petrodelta during this period.

Petrodelta 2014 Capital Budget

The CVP proposed 2014 budget for Petrodelta is for $518.8 million in capital expenditures. This is nearly double the amount spent in 2013, and we expect the actual expenditures in 2014 will be well below the budgeted amount for several reasons. The engineering processes which are required to execute the plan have not been completed. In addition, the plan requires the procurement of materials and long lead equipment as well as negotiation of contracts with suppliers and this has not progressed to a stage which allow achievement of the plan. Since Petrodelta has had insufficient monetary support and contractual adherence by PDVSA, it is possible that PDVSA will not provide the support required to execute Petrodelta’s proposed 2014 budget. Should PDVSA continue in insufficient monetary support and contractual adherence of Petrodelta, underinvestment in the development plan may lead to continued under-performance. This budget proposal has not been reviewed by Petrodelta’s board yet.

Location and Geology

Uracoa Field

At December 31, 2013, there were 76 (compared to 86 at December 31, 2012) oil and natural gas producing wells and seven (compared to seven at December 31, 2012) water injection wells in the field. The current production facility has capacity to handle 30 thousand barrels (“MBbls”) of oil per day, 130 MBbls of water per day, and storage of up to 75 MBbls of crude oil. The oil produced from Uracoa is blended with the oil produced

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from Tucupita, Bombal and Isleño fields then transported through a 25-mile oil pipeline from the Uracoa plant facilities UM-2 to PDVSA’s EPT-1 storage and fiscalization facility. Substantially all natural gas currently being delivered by Petrodelta is produced from the Uracoa field and is delivered to PDVSA through a 64-mile pipeline to Mamo gas station and PDVSA Gas network.

Tucupita Field

At December 31, 2013, there were 19 (compared to 15 at December 31, 2012) oil producing wells and five (compared to four at December 31, 2012) water injection wells in the field. The Tucupita production facility has a capacity to process 30 MBbls of oil per day, 125 MBbls of water per day and storage for up to 60 MBbls of crude oil. The oil is transported through a 31-mile, 20-MBbls-of-oil-per-day pipeline from the Tucupita field to the Uracoa plant facilities UM-2. See “Uracoa Field” above.

Bombal Field

At December 31, 2013, there were three (compared to four at December 31, 2012) oil producing wells. The oil is transported through a five-mile, ten MBbls of oil per day pipeline from the Bombal field to the Uracoa plant facilities UM-2. See “Uracoa Field” above.

Isleño Field

The Isleño field was discovered in 1953. Seven oil appraisal wells were drilled by PDVSA prior to the field being contributed to Petrodelta. At December 31, 2013, there were three (compared to two at December 31, 2012) oil producing wells in the field. The oil is transported through a pipeline to the Uracoa plant facilities UM-2. See “Uracoa Field” above. A 16-inch, 6.2-mile, 20-MBbls-per-day transfer line capacity was completed and is operational from the Isleño field to Uracoa to transport the fluids produced.

Temblador Field

At December 31, 2013, there were 28 (compared to 28 at December 31, 2012) oil producing wells in the field. The oil is transported through two pipelines: a 5.6-mile, 40-MBbls-of-oil-per-day trunkline from the TY-8 flow station (east end of the field) to the TY-23 flow station; and a 4.3-mile, 20 MBbls-of-oil-per-day gathering system from the west end of the field to the TY-23 flow station. The total crude oil is then delivered from the TY-23 flow station into PDVSA’s EPT-1 storage facility.

El Salto Field

At December 31, 2013, there were 23 (compared to 17 at December 31, 2012) oil producing wells and one (compared to one at December 31, 2012) water injection well in the El Salto field. The oil is transported through an 18.1-mile, 40-MBbls-of-oil-per-day pipeline to PDVSA’s EPM-1 storage facility.

Infrastructure and Facilities

Petrodelta has a 25-mile oil pipeline from its oil processing facilities at Uracoa to PDVSA’s EPT-1 storage facility, the custody transfer point. The pipeline has a nominal capacity of 30 MBls of oil per day and a design capacity of 60 MBls of oil per day.

Petrodelta has a 64-mile pipeline from Uracoa to the Mamo gas station and the PDVSA gas network with a nominal capacity of 70 million cubic feet (“MMcf”) of natural gas per day and a design capacity of 90 MMcf of natural gas per day.

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Petrodelta has two main gathering systems at Temblador Field, one in the east side of the field, a 5.6-mile trunkline from the TY-8 flow station to the TY-23 flow station, which is next to PDVSA’s EPT-1 storage facility. The trunkline has an operational capacity of 40 MBls of fluid per day and a design capacity of 60 MBls of oil per day. The second one, on the west side of the field, is a 4.3-mile, 20-MBbls-of-total-fluid-per-day gathering system from the end of the field to the TY-23 flow station. The total crude oil, on specification, is then delivered from the TY-23 flow station into PDVSA’s EPT-1 storage facility (the custody transfer point).

Petrodelta has an 18.1-mile pipeline from El Salto to PDVSA’s COMOR EPM-1 storage facility, the custody transfer point. The pipeline has a nominal capacity of 30 MBls of oil per day and a design capacity of 40 MBls of oil per day. Petrodelta is executing additional infrastructure enhancement projects in El Salto and Temblador.

Petrodelta has long term agreements in place with the PDVSA gas affiliate for purchase of power for electrical needs, leasing of compression, and operation and maintenance of the gas treatment and compression facilities at the Uracoa and Tucupita fields.

Drilling and Development Activity

During the year ended December 31, 2013, Petrodelta drilled and completed 13 development wells. Petrodelta delivered approximately 14.5 MBls of oil and 2.6 billion cubic feet (“Bcf”) of natural gas, averaging 41,014 BOE per day during the year ended December 31, 2013.

During the year ended December 31, 2012, Petrodelta drilled and completed 12 development wells. Petrodelta delivered approximately 13.2 MBls of oil and 2.2 Bcf of natural gas, averaging 36,979 BOE per day during the year ended December 31, 2012. During the year ended December 31, 2011, Petrodelta drilled and completed 15 development wells, one successful appraisal well and two water injector wells. Petrodelta delivered approximately 11.4 MBls of oil and 2.3 Bcf of natural gas, averaging 32,240 BOE per day during the year ended December 31, 2011.

Currently, Petrodelta is operating six drilling rigs and one workover rig and is continuing with infrastructure enhancement projects in the El Salto and Temblador fields. A pipeline was completed in March 2013, and it is operational between the Isleño field and the main production facility at Uracoa.

Risk Factors

We face significant risks in holding a minority equity investment in Petrodelta. These risks and other risk factors are discussed in Item 1A. Risk Factors and Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Dussafu Marin, Offshore Gabon

General

In 2008, we acquired a 66.667 percent ownership interest in the Dussafu PSC through two separate acquisitions. We are the operator.

The Dussafu PSC partners and Gabon, represented by the Ministry of Mines, Energy, Petroleum and Hydraulic Resources, entered into the third exploration phase of the Dussafu PSC with an effective date of May 28, 2012. The Direction Generale Des Hydrocarbures agreed to lengthen the third exploration phase to four years, until May 27, 2016.

Location and Geology

The Dussafu PSC contract area is located offshore Gabon, adjacent to the border with the Republic of Congo. It contains 680,000 acres with water depths to 1,650 feet. Production and infrastructure exists in the blocks contiguous to the Dussafu PSC.

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Drilling and Development Activity

During 2011, we drilled our first exploratory well, Dussafu Ruche Marin-1 (“DRM-1”), and two appraisal sidetracks. DRM-1 and sidetracks discovered oil of approximately 149 feet of pay within the Gamba and Middle Dentale Formations. DRM-1 and sidetracks are currently suspended pending further exploration and development activities.

Operational activities during 2012 included completion of the time processing of 545 square kilometers of seismic, which was acquired in the fourth quarter of 2011, and well planning. The 3-D Pre-Stack Time Migration was completed in July 2012. Pre-Stack Depth processing and reprocessing of the 2005 Inboard 3-D seismic of approximately 1,300 square kilometers commenced in June 2012 with the time reprocessing and merging of the various 3-D surveys completed in September 2012. The Pre-Stack Depth processing project was completed in September 2013.

During the fourth quarter of 2012, our second exploration well on the Tortue prospect to target stacked pre-salt Gamba and Dentale reservoirs commenced. DTM-1 was spud on November 19, 2012 in a water depth of 380 feet. On January 4, 2013, we announced that DTM-1 had reached a vertical depth of 11,260 feet within the Dentale Formation. Log evaluation and pressure data indicate that we have an oil discovery of approximately 42 feet of pay in a 72-foot column within the Gamba Formation and 123 feet of pay in stacked reservoirs within the Dentale Formation.

The first appraisal sidetrack of DTM-1 (“DTM-1ST1”) was spud in January 12, 2013. DTM-1ST1 was drilled to a total depth of 11,385 feet in the Dentale Formation, approximately 1,800 feet from DTM-1 wellbore and found 65 feet of pay in the primary Dentale reservoir. Several other stacked sands with oil shows were encountered; however, due to a stuck downhole tool, logging operations were terminated before pressure data could be collected to confirm connectivity. The well can be re-entered, and the downhole tool has since been retrieved. Work on DTM-1 and DTM-1ST1 was suspended pending future appraisal and development activities.

Geoscience, reservoir engineering and economic studies have progressed and a field development plan is being prepared for a cluster field development of both the Ruche and Tortue discoveries along with existing pre-salt discoveries at Walt Whitman and Moubenga.

Following the success in both the pre-salt Gamba and Dentale reservoirs in the two Harvest exploration wells a new 1,130 square kilometer 3D seismic survey commenced in October and completed in mid-November 2013. This is first 3D coverage over the outboard area of the Dussafu license, where significant pre-salt prospectivity has been already recognized on 2D seismic data. Pre-Stack Depth processing commenced in December 2013 with the first high quality seismic products expected to be available during the second quarter of 2014. The pre-salt reservoirs are currently the focus of deep water exploration activity offshore Gabon. The new 3D seismic data was extended to be acquired over the two Harvest discoveries and should also enhance the placement of future development wells in the Ruche and Tortue development program. We continue to evaluate our prospects, but we have not drilled any additional wells.

Budong-Budong, Onshore Indonesia

General

In 2007, we entered into a farmout agreement to acquire a 47 percent interest in the Budong PSC located mostly onshore West Sulawesi, Indonesia. In April 2008, Indonesia approved this assignment. Our partner is the operator through the exploration phase as required by the terms of the Budong PSC, and we have an option to become operator, if approved by Indonesia and SKK Migas, the Special Task force for the oil and gas sector, in any subsequent development and production phase.

We acquired our 47 percent interest in the Budong PSC by committing to fund the first phase of the exploration program up to a maximum of $17.2 million, including the acquisition of 2-D seismic information and drilling of the first two exploration wells. Before we drilled the first exploration well, our partner had a one-time

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option to increase the level of the carried interest to a maximum of $20.0 million. On September 15, 2010, our partner exercised its option to increase its carried interest by $2.7 million to a total of $19.9 million. The additional carried interest increased our ownership by 7.4 percent to 54.4 percent. On March 3, 2011, Indonesia approved this change in ownership interest.

On January 14, 2011, we exercised our first refusal right to a proposed transfer of interest by the operator to a third party, which allowed us to acquire an additional 10 percent ownership interest in the Budong PSC at a cost of $3.7 million payable ten business days after completion of the first exploration well. The $3.7 million was paid on April 18, 2011. Closing of this acquisition increased our participating ownership interest in the Budong PSC to 64.4 percent with our cost-sharing interest becoming 64.51 percent until first commercial production. On August 11, 2011, Indonesia approved this change in ownership interest.

The initial exploration term of the Budong PSC was due to expire on January 15, 2013. In September 2012, the operator of the Budong PSC, on behalf of us and our partner, submitted a request to BPMIGAS, Indonesia’s oil and gas regulatory authority, under the terms of the Budong PSC for a four-year extension of the initial six-year exploration term of the Budong PSC. In January 2013, we received written approval from SKK Migas of the four-year extension of the initial six-year exploration term to January 15, 2017.

In November 2012, the Indonesia constitutional court declared BPMIGAS to be unconstitutional. In January 2013, SKK Migas was formed to replace BPMIGAS. SKK Migas supervises all oil and gas industry activities in Indonesia.

In December 2012, we signed a farmout agreement with the operator of the Budong PSC to acquire an additional 7.1 percent participating interest and to become operator of the Budong PSC. We assumed the role of operator effective March 25, 2013. Closing of this acquisition on April 22, 2013 increased our participating ownership interest in the Budong PSC to 71.5 percent with our cost-sharing interest becoming 72 percent until first commercial production. The consideration for this transaction is that we will fund 100 percent of the costs of the first exploration well of the four-year extension to the Budong PSC. If we do not drill an exploration well before October 2014, our partner has the right to give us notice that the consideration for the additional 7.1 percent participating interest must be paid in cash for $3.2 million.

We have satisfied all work commitments for the current exploration phase of the Budong PSC. However, the extension of the initial exploration term includes an exploration well, which if not drilled by January 2016, results in the termination of the Budong PSC. We are actively discussing the sale of our interests in Budong, and based on indications of interest received in December 2013, we determined that is it was appropriate to recognize and impairment expense of $0.6 million and a charge included in general and administrative expenses related to a valuation allowance on VAT that we do not expect to recover of $2.8 million.

Location and Geology

During the initial exploration period, the Budong PSC covered 1.35 million acres. The Budong PSC includes a ten-year exploration period and a 20-year development phase. Pursuant to the terms of the Budong PSC, at the end of the first three-year exploration phase, 45 percent of the original area was to be relinquished to BPMIGAS. In January 2010, 35 percent of the original area was relinquished and 10 percent of the required relinquishment was deferred until 2011. In January 2011, the deferred 10 percent of the original total contract area was relinquished. The Budong PSC currently covers 0.75 million acres. However, pursuant to the request for extension of the initial exploration term, the contract area held by the Budong PSC at the beginning of the extension period should be reduced, according to the terms of the Budong PSC, from the current 55 percent to 20 percent of the original contract area. In January 2014, we submitted a relinquishment deferral proposal of 5 percent to SKK Migas. The retained area will contain all the areas of geological interest to the Budong PSC partners.

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The Budong PSC includes the Lariang and Karama sub-basins, which are the eastern onshore extension of the West Sulawesi foldbelt (“WSFB”). Field work performed has confirmed the presence of Eocene source and reservoir potential. Offshore seismic surveys have greatly improved the understanding of the geology and enhanced the prospectivity of the offshore WSFB and, by analogy, the sparsely explored onshore area.

Drilling and Development Activity

In 2011, two exploratory wells were drilled, Lariang-1 (“LG-1”) and Karama-1 (“KD-1”). Both wells were plugged and abandoned in 2011 and early 2012.

Operational activities during 2012 focused on a review of geological and geophysical data obtained from the drilling of LG-1 and KD-1 wells to upgrade the prospectivity of the block and to define a prospect for potential drilling in 2013. We have completed remapping of both the Lariang and Karama Basins with eight leads in the Lariang Basin and five leads in the Karama Basin having been identified. The identification of these leads is the basis for the four-year extension request of the first six-year exploration term. We continue to evaluate our prospects, but we have not drilled any additional wells.

WAB-21, South China Sea

General

In 1996, we acquired a petroleum contract with China National Offshore Oil Corporation (“CNOOC”) for the WAB-21 area. The WAB-21 petroleum contract area lies within an area that is the subject of a border dispute between China and Socialist Republic of Vietnam (“Vietnam”). Vietnam has executed an agreement on a portion of the same offshore acreage with another company. The border dispute has lasted for many years, and there has been limited exploration and no development activity in the WAB-21 area due to the dispute. Although it is uncertain when or how this dispute will be resolved and under what terms the various countries and parties to the agreements may participate in the resolution, there has been a small increase in exploration activity in the area starting in 2009.

Location and Geology

The WAB-21 contract area covers 6.2 million acres in the South China Sea, with an option for an additional 1.25 million acres under certain circumstances, and is located in the West Wan’ an Bei Basin (Nam Con Son) of the South China Sea. Its western edge lies approximately 20 miles to the east of significant producing natural gas fields, Lan Tay and Lan Do, which are reported to contain two trillion cubic feet (“Tcf”) of natural gas and commenced production in November 2002. Also located to the west of WAB-21 are the Dua and Chim Sao discoveries that commenced oil production in 2011 and the oil and gas discovery in 2009 of Ca’ Rong Doh. The WAB-21 contract area covers a large unexplored area of the Wan’ an Bei Basin where the same successful Lower Miocene through to Upper Miocene plays to the west are present. Exploration success by other operators outside the WAB-21 contract area in the basin to date has resulted in discoveries estimated to total in excess of 500 MBls of oil and 7.5 Tcf of natural gas. Several similar structural trends and geological formations, each with significant potential for hydrocarbon reserves in traps with multiple pay zones similar to the known fields and discoveries to the west are present within WAB-21.

Drilling and Development Activity

Due to the border dispute between China and Vietnam, we have been unable to pursue an exploration program during phase one of the contract. The Joint Management Committee has approved an extension of the license until May 31, 2015. While no assurance can be given, we believe we will continue to receive contract extensions so long as the border disputes persist.

Even though there continues to be increasing activity on the Vietnamese blocks, which we believe confirms our view of WAB-21’s prospectivity, we impaired the carrying value of WAB-21 at December 31, 2012 due to our continued inability to pursue an exploration program. However, we continue to seek permission to acquire regional 2-D seismic and localized 3-D seismic.

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Colombia-Discontinued Operations

In February 2013, we signed farmout agreements on Block VSM14 and Block VSM15 in Colombia. Under the terms of the farm-out agreements, we had a 75 percent beneficial working interest and our partners had a 25 percent carried interest for the minimum exploratory work commitments on each block. We requested the legal assignment of the interest by the Agencia Nacional de Hidrocarburos (“ANH”), Colombia’s oil and gas regulatory authority, and approval of us as operator.

For both blocks, phase one of the contract began on December 15, 2012 and expires on December 15, 2015. The minimum work commitments for phase one of VSM14 include three exploration wells and the acquisition of 70 kilometers of 2D seismic information. The minimum work commitment for phase one of VSM15 includes one exploration well, the acquisition of 65 kilometers of 2D seismic information, reprocessing of 70 kilometers of 2D seismic information and the acquisition of 91 square kilometers of 3D seismic information.

VSM14 covers 137,061 acres and VSM15 covers 105,721 acres. Both blocks are located in the Upper Magdalena Valley in Colombia. The blocks are considered to be prospective for conventional oil and gas fields in multiple reservoirs in Tertiary and Cretaceous rocks, as well as for unconventional oil and gas fields in the Cretaceous La Luna and Villeta formations.

To date, there have been two exploration wells drilled on block VSM 14, both of which were plugged and abandoned. There have been no wells drilled on block VSM 15.

We have received notices of default from our partners for failing to comply with certain terms of the farmout agreements for Block VSM 14 and Block VSM 15, followed by notices of termination on November 27, 2013. As discussed further in “Item 3. Legal Proceedings”, our partners have filed for arbitration of claims related to these agreements. After evaluating these circumstances, we determined that it was appropriate to fully impair the costs associated with these interests, and we recorded an impairment charge of $3.2 million during the year ended December 31, 2013. As we no longer have any interests in Colombia, we have reflected the results in discontinued operations.

Block 64 EPSA, Oman-Discontinued Operations

In 2009, we signed an EPSA with Oman for Block 64 EPSA. We had an 80 percent working interest and our partner, Oman Oil Company, had a 20 percent carried interest in Block 64 EPSA during the initial period.

The First Phase of Block 64 EPSA had a minimum work obligation of $22 million to reprocess 375 square kilometers of 3-D seismic and drill two exploration wells to penetrate and evaluate at least the potential objectives of the Haima Supergroup. In 2011, two exploratory wells were drilled, Mafraq South-1 (“MFS-1”) and Al Ghubar North-1 (“AGN-1”). Both wells were plugged and abandoned in the fourth quarter of 2011 and first quarter of 2012. Operational activities during 2012 included post-well evaluation and review of geological and geophysical data obtained from the drilling of the MFS-1 and AGN-1 wells.

On March 12, 2013, we elected to not request an extension of the first phase or enter the second phase of Block 64 EPSA, and Block 64 was relinquished effective May 23, 2013. The carrying value of Block 64 EPSA of $6.4 million was considered to be impaired and a related impairment expense was recorded at December 31, 2012. During the first half of 2013, we terminated operations and closed the field office. Our activities in Oman have been reflected as discontinued operations in our financial statements.

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Production, Prices and Lifting Cost Summary

In the following table we have set forth, by country, our net production, average sales prices and average operating expenses for the years ended December 31, 2013, 2012 and 2011. The presentation for Venezuela is presented at our net ownership interest in Petrodelta which was 32 percent through December 15, 2013 and 20.4 percent thereafter. The United States is presented at our ownership interest.

	Year Ended December 31,
	2013		2012		2011
Venezuela
Crude Oil Production (MBbls) (b)		3,052		2,810		2,430
Natural Gas Production (MMcf) (a)(c)		547		463		483
Average Crude Oil Sales Price ($ per Bbl)	$	91.22	$	95.91	$	98.52
Average Natural Gas Sales Price ($ per Mcf)	$	1.54	$	1.54	$	1.54
Average Operating Expenses ($ per BOE) (d)	$	12.08	$	10.22	$	8.99
United States-Discontinued Operations (e)
Monument Butte (e)
Net Crude Oil Production (MBbls)		0		0		21
Natural Gas Production (MMcf)		0		0		324
Average Crude Oil Sales Price ($ per Bbl)	$	0	$	0	$	77.91
Average Natural Gas Sales Price ($ per Mcf)	$	0	$	0	$	3.733
Average Operating Expenses ($ per BOE)	$	0	$	0	$	10.34
Lower Green River/Upper Wasatch (e)
Net Crude Oil Production (MBbls)		0		0		40
Natural Gas Production (MMcf)		0		0		13
Average Crude Oil Sales Price ($ per Bbl)	$	0	$	0	$	89.60
Average Natural Gas Sales Price ($ per Mcf)	$	0	$	0	$	4.62
Average Operating Expenses ($ per BOE)	$	0	$	0	$	56.86

^(a)  Royalty-in-kind paid on gas used as fuel by Petrodelta net to our ownership interest (32% through December 15, 2013 and 20.4% thereafter) was 6,412 MMcf for 2013 (4,256 MMcf for2012, 3,226 MMcf for 2011).

^(b)  Crude oil sales net to our ownership interest (32% through December 15, 2013 and 20.4% thereafter) after deduction of royalty. Crude oil sales for Petrodelta at 100 percent were 14,538 MBbls for 2013 (13,172 MBbls for 2012, 11,390 MBbls for 2011).

^(c)  Natural gas sales net to our ownership interest (32% through December 15, 2013 and 20.4% thereafter) after deduction of royalty. Natural gas sales for Petrodelta at 100 percent were 2,593 MMcf for 2013 (2,171 MMcf for 2012, 2,266 MMcf for 2011).

^(d)  Petrodelta is not subject to ad valorem or severance taxes. Average operating expenses per BOE net of royalties and workovers were $15.76 for 2013 ($13.41 per BOE for 2012, $9.84 per BOE for 2011). See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, Results of Operations, Years Ended December 31, 2013 and 2012, Equity in Earnings from Equity Affiliates.

^(e)  Property was sold effective March 1, 2011 and is reported as discontinued operations.

Drilling and Undeveloped Acreage

For acquisitions of leases, development and exploratory drilling, we spent approximately (excluding our share of capital expenditures incurred by equity affiliates) $43.9 million in 2013 ($23.6 million in 2012, $106.1 million in 2011). These numbers do not include any costs for the development of proved undeveloped reserves in 2013, 2012 or 2011.

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We have participated in the drilling of wells as follows:

	Year Ended December 31,
	2013				2012				2011
	Gross		Net		Gross		Net		Gross		Net
Wells Drilled Productive:
Venezuela (Petrodelta)
Development		13		2.7		12		3.8		15		4.8
Appraisal		0		0		0		0		1		0.3
Gabon
Exploration		1		0.7		0		0		1		0.7
United States-Discontinued Operations
Development		0		0		0		0		1		0.7
Exploration		0		0		0		0		2		0.7
Wells Drilled Dry:
Indonesia
Exploration		0		0		0		0		2		1.3
Oman-Discontinued Operations
Exploration		0		0		1		0.8		1		0.8
Producing Wells (1):
Venezuela (Petrodelta)
Crude Oil		173		35		152		48.6		143		45.8
United States-Discontinued Operations
Crude Oil		0		0		0		0		0		0

⁽¹⁾  The information related to producing wells reflects wells we drilled, wells we participated in drilling and producing wells we acquired.

	Year Ended December 31,
	2013		2012		2011
Average Depth of Wells (Feet) Drilled
Venezuela (Petrodelta)
Crude Oil		7,979		7,905		7,298
Gabon
Crude Oil		11,260		0		11,355
Indonesia
Crude Oil		0		0		9,874
Oman-Discontinued Operations
Natural Gas		0		10,482		10,348
United States-Discontinued Operations
Crude Oil		0		0		10,021
Natural Gas		0		0		0

In Gabon, following the success in both the pre-salt Gamba and Dentale reservoirs in the two Harvest exploration wells, a new seismic survey commenced in October and we expect the first high quality seismic products expected to be available during the second quarter of 2014. The new 3D seismic data was extended to be acquired over the two Harvest discoveries and should also enhance the placement of future development wells in the Ruche and Tortue development program. We continue to evaluate our prospects, but we have not drilled any additional wells.

All of our drilling activities are conducted on a contract basis with independent drilling contractors. We do not directly operate any drilling equipment.

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Acreage

The following table summarizes the developed and undeveloped acreage that we own, lease or hold under concession as of December 31, 2013:

	Developed				Undeveloped
	Gross		Net		Gross		Net
Venezuela – Petrodelta		27,460		5,602		220,653		45,013
China		0		0		7,470,080		7,470,080
Gabon		0		0		685,470		456,982
Indonesia (1)		0		0		611,956		437,548
Total		27,460		5,602		8,988,159		8,409,623

⁽¹⁾ In January 2014, additional acreage was relinquished back to the Government of Indonesia under the terms of the PSC reducing our gross undeveloped acreage to 339,423 or 242,687 net acres.

Regulation

General

Our operations and our ability to finance and fund our growth strategy are affected by political developments and laws and regulations in the areas in which we operate. In particular, oil and natural gas production operations and economics are affected by:

• change in governments;

• civil unrest;

• price and currency controls;

• limitations on oil and natural gas production;

• tax, environmental, safety and other laws relating to the petroleum industry;

• changes in laws relating to the petroleum industry;

• changes in administrative regulations and the interpretation and application of administrative rules and regulations; and

• changes in contract interpretation and policies of contract adherence.

In any country in which we may do business, the oil and natural gas industry legislation and agency regulation are periodically changed, sometimes retroactively, for a variety of political, economic, environmental and other reasons. Numerous governmental departments and agencies issue rules and regulations binding on the oil and natural gas industry, some of which carry substantial penalties for the failure to comply. The regulatory burden on the oil and natural gas industry increases our cost of doing business and our potential for economic loss.

Environmental Regulations

Our operations are subject to various federal, state, local and international laws and regulations governing the discharge of materials into the environment or otherwise relating to environmental protection. The cost of compliance could be significant. Failure to comply with these laws and regulations may result in the assessment of administrative, civil and criminal penalties, the imposition of remedial and damage payment obligations, or the issuance of injunctive relief (including orders to cease operations). Environmental laws and regulations are complex and have tended to become more stringent over time. We also are subject to various environmental permit requirements. Some environmental laws and regulations may impose strict liability, which could subject us to liability for conduct that was lawful at the time it occurred or conduct or conditions caused by prior

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operators or third parties. To the extent laws are enacted or other governmental action is taken that prohibits or restricts drilling or imposes environmental protection requirements that result in increased costs to the oil and gas industry in general, our business and financial results could be adversely affected.

Competition

We encounter substantial competition from major, national and independent oil and natural gas companies in acquiring properties and leases for the exploration and development of crude oil and natural gas. The principal competitive factors in the acquisition of oil and natural gas properties include staff and data necessary to identify, investigate and purchase properties, the financial resources necessary to acquire and develop properties, and access to local partners and governmental entities. Many of our competitors have influence, financial resources, staffs, data resources and facilities substantially greater than ours.

Employees

At December 31, 2013, full-time employees in our various offices were: Houston – 17; Caracas – 12; London – 3; Singapore – 2; and Jakarta –12. We augment our employees from time to time with independent consultants, as required.

Item 1A. Risk Factors

In addition to other information set forth elsewhere in this Annual Report on Form 10-K, the following factors should be carefully considered when evaluating us.

Risks Related to Our Business

Our cash position and limited ability to access additional capital may limit our growth opportunities. We have no recurring cash flows, and our available cash may not be sufficient to meet capital and operational commitments for the next twelve months. Our future cash position depends primarily upon the successful completion of the second closing sale, but is also impacted by farm-out, or possible sale or otherwise monetization of assets as necessary to maintain the liquidity required to run our operations and capital spending requirements. There is no assurance that the second closing sale will be completed, and under certain circumstances we may be required to repurchase the First Closing Shares at the greater of $125 million or fair value. These factors could have a material adverse effect on our financial condition and liquidity and may limit our ability to grow through the acquisition or exploration of additional oil and gas properties and projects.

Our business may be sensitive to market prices for oil and gas. We have made significant investments in our oil and gas properties. As we seek to sell the assets in our portfolio, to the extent market values of oil and gas decline, the valuation of the investments in these projects may be adversely affected.

Global market and economic conditions, including those related to the credit markets, could have a material adverse effect on our business, financial condition and results of operations. A general slowdown in economic activity could adversely affect our business by impacting our ability to access additional capital as well as the need to preserve adequate development capital in the interim.

We may not be able to meet certain contractual funding requirements. We have added a significant global exploration component to diversify our overall portfolio. In many locations, we may be required to post performance bonds in support of a work program or the work program may include minimum funding requirements to keep the contract. We may not have the funds available to meet the minimum funding requirements when they come due and be required to forfeit the contracts.

Our portfolio of hydrocarbon assets in known hydrocarbon basins globally are exposed to greater deal execution, operating, financial, legal and political risks. The environments in which we operate are often difficult and the ability to operate successfully will depend on a number of factors, including our ability to

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control the pace of development, our ability to apply “best practices” in drilling and development, and the fostering of productive and transparent relationships with local partners, the local community and governmental authorities. Financial risks include our ability to control costs and attract financing for our projects. In addition, often the legal systems of these countries are not mature and their reliability is uncertain. This may affect our ability to enforce contracts and achieve certainty in our rights to develop and operate oil and natural gas projects, as well as our ability to obtain adequate compensation for any resulting losses. Our business depends on our ability to have significant influence over operations and financial control.

We do not directly manage operations of Petrodelta. PDVSA, through CVP, exercises substantial control over Petrodelta’s operations, making Petrodelta subject to some internal policies and procedures of PDVSA as well as being subject to constraints in skilled personnel available to Petrodelta. These issues may have an adverse effect on the efficiency and effectiveness of Petrodelta’s operations.

We hold a minority equity investment in Petrodelta. Even though we are able to exercise significant influence as a minority equity investor in Petrodelta, our control of Petrodelta is limited to our rights under the Conversion Contract and its annexes and Petrodelta’s charter and bylaws. As a result, our ability to implement or influence Petrodelta’s business plan, assure quality control, and set the timing and pace of development may be adversely affected. In addition, the majority partner, CVP, has initiated and undertaken numerous unilateral decisions that can impact our minority equity investment.

Petrodelta’s business plan will be sensitive to market prices for oil. Petrodelta operates under a business plan, the success of which will rely heavily on the market price of oil. To the extent that market values of oil decline, the business plan of Petrodelta may be adversely affected.

A decline in the market price of crude oil could uniquely affect the financial condition of Petrodelta. Under the terms of the Conversion Contract and other governmental documents, Petrodelta is subject to a special advantage tax (“ventajas especiales”) which requires that if in any year the aggregate amount of royalties, taxes and certain other contributions is less than 50 percent of the value of the hydrocarbons produced, Petrodelta must pay the government of Venezuela the difference. In the event of a significant decline in crude prices, the ventajas especiales could force Petrodelta to operate at a loss. Moreover, our ability to control those losses by modifying Petrodelta’s business plan or restricting the budget is limited under the Conversion Contract.

An increase in oil prices could result in increased tax liability in Venezuela affecting Petrodelta’s operations and profitability, which in turn could affect our dividends and profitability. Prices for oil fluctuate widely. In April 2011, the Venezuelan government published the amended Windfall Profits Tax which establishes a special contribution for extraordinary prices to the Venezuelan government of 20 percent to be applied to the difference between the price fixed by the Venezuela budget for the relevant fiscal year (set at $55 per barrel for 2013) and $80 per barrel. The amended Windfall Profits Tax also establishes a special contribution for exorbitant prices to the Venezuelan government of (1) 80 percent when the average price of the Venezuelan Export Basket (“VEB”) exceeds $80 per barrel but is less than $100 per barrel; (2) 90 percent when the average price of the VEB exceeds $100 per barrel but is less that $110 per barrel; and (3) 95 percent when the average price of the VEB exceeds $110 per barrel. Any increase in the taxes payable by Petrodelta, including the Windfall Profits Tax, as a result of increased oil prices will reduce cash available for dividends to us and our partner, CVP.

Oil price declines and volatility could adversely affect Petrodelta’s operations and profitability, which in turn could affect our dividends and profitability. Prices for oil also affect the amount of cash flow available for capital expenditures and dividends from Petrodelta. Lower prices may also reduce the amount of oil that we can produce economically and lower oil production could affect the amount of natural gas we can produce. We cannot predict future oil prices. Factors that can cause fluctuations in oil prices include:

• relatively minor changes in the global supply and demand for oil;

• export quotas;

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• market uncertainty;

• the level of consumer product demand;

• weather conditions;

• domestic and foreign governmental regulations and policies;

• the price and availability of alternative fuels;

• political and economic conditions in oil-producing and oil consuming countries; and

• overall economic conditions.

The total capital required for development of Petrodelta’s assets may exceed the ability of Petrodelta to finance such developments. Petrodelta’s ability to fully develop the fields in Venezuela will require a significant investment. Petrodelta’s future capital requirements for the development of its assets may exceed the cash available from existing cash flow. Petrodelta’s ability to secure financing is currently limited and uncertain, and has been, and may be, affected by numerous factors beyond its control, including the risks associated with operating in Venezuela. Because of this financial risk, Petrodelta may not be able to secure either the equity or debt financing necessary to meet its future cash needs for investment, which may limit its ability to fully develop the properties, cause delays with their development or require early divestment of all or a portion of those projects. This could negatively impact our minority equity investment. If we are called upon to fund our share of Petrodelta’s operations, our failure to do so could be considered a default under the Conversion Contract and cause the forfeiture of some or all our shares in Petrodelta. In addition, CVP may be unable or unwilling to fund its share of capital requirements and our ability to require them to do so is limited. Should PDVSA continue in insufficient monetary support and contractual adherence of Petrodelta, underinvestment in the development plan may lead to continued under-performance.

The legal or fiscal framework for Petrodelta may change and the Venezuelan government may not honor its commitments. While we believe that the Conversion Contract and Petrodelta provide a basis for a more durable arrangement in Venezuela, the value of the investment necessarily depends upon Venezuela’s maintenance of legal, tax, royalty and contractual stability. Our experiences in Venezuela demonstrate that such stability cannot be assured. While we have and will continue to take measures to mitigate our risks, no assurance can be provided that we will be successful in doing so or that events beyond our control will not adversely affect the value of our minority equity investment in Petrodelta.

PDVSA’s failure to timely pay contractors could have an adverse effect on Petrodelta. PDVSA has failed to pay on a timely basis certain amounts owed to contractors that PDVSA has contracted to do work for Petrodelta. PDVSA purchases all of Petrodelta’s oil production. PDVSA and its affiliates have reported shortfalls in meeting their cash requirements for operations and planned capital expenditures, and PDVSA has fallen behind in certain of its payment obligations to its contractors, including contractors engaged by PDVSA to provide services to Petrodelta. In addition, PDVSA has fallen behind in certain of its payment obligations to Petrodelta, which payments Petrodelta would otherwise use to pay its contractors, including Harvest Vinccler. As a result, Petrodelta is continuing to experience difficulty in retaining contractors who provide services for Petrodelta’s operations. We cannot provide any assurance as to whether or when PDVSA will become current on its payment obligations. Inability to retain contractors or to pay them on a timely basis is continuing to have an adverse effect on Petrodelta’s operations and on Petrodelta’s ability to carry out its business plan.

Risks Related to Our Industry

Estimates of oil and natural gas reserves are uncertain and inherently imprecise. This Annual Report on Form 10-K contains estimates of our oil and natural gas reserves. These estimates are based upon various assumptions, including assumptions required by the SEC relating to oil prices, drilling and operating expenses, capital expenditures, taxes and availability of funds.

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The process of estimating oil and natural gas reserves is complex, requiring significant decisions and assumptions in the evaluation of available geological, geophysical, engineering and economic data for each reservoir. Therefore, these estimates are inherently imprecise. Actual future production, oil and natural gas prices, revenues, taxes, development expenditures, operating expenses and quantities of recoverable oil and natural gas reserves likely will vary from those estimated. Any significant variance could materially affect the estimated quantities and present value of reserves set forth. Actual production, revenue, taxes, development expenditures and operating expenses with respect to our reserves will likely vary from the estimates used, and these variances may be material.

You should not assume that the present value of future net revenues referred to in Item 15. Additional Supplemental Information on Oil and Natural Gas Producing Activities (unaudited) for Petrodelta S.A., TABLE V – Standardized Measure of Discounted Future Net Cash Flows Related to Proved Oil and Natural Gas Reserve Quantities is the current market value of our estimated oil and natural gas reserves. In accordance with SEC requirements, the estimated discounted future net cash flows from proved reserves are generally based on the unweighted average price of the first day of the month during the 12-month period before the ending date of the period covered by the reserve report and costs as of the date of the estimate. Actual future prices and costs may be materially higher or lower than the prices and costs as of the date of the estimate. Any changes in demand, changes in our ability to produce or changes in governmental regulations, policies or taxation will also affect actual future net cash flows. The timing of both the production and the expenses from the development and production of oil and natural gas properties will affect the timing of actual future net cash flows from estimated proved reserves and their present value. In addition, the 10 percent discount factor, which is required by the SEC to be used in calculating discounted future net cash flows for reporting purposes, is not necessarily the most accurate discount factor. The effective interest rate at various times and the risks associated with the oil and natural gas industry in general will affect the accuracy of the 10 percent discount factor.

We may not be able to replace production with new reserves. In general, production rates and remaining reserves from oil and natural gas properties decline as reserves are depleted. The decline rates depend on reservoir characteristics. Our future oil and natural gas production is highly dependent upon our level of success in finding or acquiring additional reserves. The business of exploring for, developing or acquiring reserves is capital intensive and uncertain. We may be unable to make the necessary capital investment to maintain or expand our oil and natural gas reserves if cash flow from operations is reduced and external sources of capital become limited or unavailable. We cannot give any assurance that our future exploration, development and acquisition activities will result in additional proved reserves or that we will be able to drill productive wells at acceptable costs.

Our future operations and our investments in equity affiliates are subject to numerous risks of oil and natural gas drilling and production activities. Oil and natural gas exploration and development drilling and production activities are subject to numerous risks, including the risk that no commercially productive oil or natural gas reservoirs will be found. The cost of drilling and completing wells is often uncertain. Oil and natural gas drilling and production activities may be shortened, delayed or canceled as a result of a variety of factors, many of which are beyond our control. These factors include:

• shortages or delays in the delivery of equipment;

• shortages in experienced labor;

• pressure or irregularities in formations;

• unexpected drilling conditions;

• equipment or facilities failures or accidents;

• remediation and other costs resulting from oil spills or releases of hazardous materials;

• government actions or changes in regulations;

• delays in receiving necessary governmental permits;

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• delays in receiving partner approvals; and

• weather conditions.

The prevailing price of oil also affects the cost of and availability for drilling rigs, production equipment and related services. We cannot give any assurance that the new wells we drill will be productive or that we will recover all or any portion of our investment. Drilling for oil and natural gas may be unprofitable. Drilling activities can result in dry wells and wells that are productive but do not produce sufficient net revenues after operating and other costs.

We operate in many different jurisdictions and we could be adversely affected by violations of the U.S. Foreign Corrupt Practices Act and similar worldwide anti-corruption laws. The U.S. Foreign Corrupt Practices Act (“FCPA”) and similar worldwide anti-corruption laws, including the U.K. Bribery Act 2010, which is broader in scope than the FCPA, generally prohibit companies and their intermediaries from making improper payments to government and other officials for the purpose of obtaining or retaining business. Our internal policies mandate compliance with these anti-corruption laws. Despite our training and compliance programs, we cannot be assured that our internal control policies and procedures will always protect us from acts of corruption committed by our employees or agents. Our continued expansion outside the U.S., including in developing countries, could increase the risk of such violations in the future. Violations of these laws, or allegations of such violations, could disrupt our business and result in a material adverse effect on our financial condition, results of operations and cash flows.

Operations in areas outside the United States are subject to various risks inherent in foreign operations. Our operations are subject to various risks inherent in foreign operations. These risks may include, among other things, loss of revenue, property and equipment as a result of hazards such as expropriation, nationalization, war, insurrection, civil unrest, strikes and other political risks, increases in taxes and governmental royalties, being subject to foreign laws, legal systems and the exclusive jurisdiction of foreign courts or tribunals, renegotiation of contracts with governmental entities, changes in laws and policies, including taxes, governing operations of foreign-based companies, currency restrictions and exchange rate fluctuations and other uncertainties arising out of foreign government sovereignty over our international operations. Our international operations may also be adversely affected by laws and policies of the United States affecting foreign policy, foreign trade, taxation and the possible inability to subject foreign persons to the jurisdiction of the courts in the United States.

Our oil and natural gas operations are subject to various governmental regulations that materially affect our operations. Our oil and natural gas operations are subject to various governmental regulations. These regulations may be changed in response to economic or political conditions. Matters regulated may include permits for discharges of wastewaters and other substances generated in connection with drilling operations, bonds or other financial responsibility requirements to cover drilling contingencies and well plugging and abandonment costs, reports concerning operations, the spacing of wells, and unitization and pooling of properties and taxation. At various times, regulatory agencies have imposed price controls and limitations on oil and natural gas production. In order to conserve or limit supplies of oil and natural gas, these agencies have restricted the rates of the flow of oil and natural gas wells below actual production capacity. We cannot predict the ultimate cost of compliance with these requirements or their effect on our operations.

We are subject to complex laws that can affect the cost, manner or feasibility of doing business. Exploration and development and the production and sale of oil and natural gas are subject to extensive federal, state, local and international regulation. We may be required to make large expenditures to comply with environmental and other governmental regulations. Matters subject to regulation include:

• the amounts and types of substances and materials that may be released into the environment;

• response to unexpected releases to the environment;

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• reports and permits concerning exploration, drilling, production and other operations; and

• taxation.

Under these laws, we could be liable for personal injuries, property damage, oil spills, discharge of hazardous materials, remediation and clean-up costs, natural resource damages and other environmental damages. We also could be required to install expensive pollution control measures or limit or cease activities on lands located within wilderness, wetlands or other environmentally or politically sensitive areas. Failure to comply with these laws also may result in the suspension or termination of our operations and subject us to administrative, civil and criminal penalties as well as the imposition of corrective action orders. Moreover, these laws could change in ways that substantially increase our costs. Any such liabilities, penalties, suspensions, terminations or regulatory changes could have a material adverse effect on our financial condition, results of operations or cash flows.

The oil and gas business involves many operating risks that can cause substantial losses, and insurance may not protect us against all of these risks. We are not insured against all risks. Our oil and gas exploration and production activities are subject to all of the operating risks associated with drilling for and producing oil and gas, including the risk of:

• fires and explosions;

• blow-outs;

• uncontrollable or unknown flows of oil, gas, formation water or drilling fluids;

• adverse weather conditions or natural disasters;

• pipe or cement failures and casing collapses;

• pipeline ruptures;

• discharges of toxic gases;

• build up of naturally occurring radioactive materials; and

• vandalism.

If any of these events occur, we could incur substantial losses as a result of:

• injury or loss of life;

• severe damage or destruction of property and equipment, and oil and gas reservoirs;

• pollution and other environmental damage;

• investigatory and clean-up responsibilities;

• regulatory investigation and penalties;

• suspension of our operations; and

• repairs to resume operations.

If we experience any of these problems, our ability to conduct operations could be adversely affected.

We maintain insurance against some, but not all, of these potential risks and losses. We may elect not to obtain insurance if we believe that the cost of available insurance is excessive relative to the risks presented. In addition, pollution and environmental risks generally are not insurable.

Competition within the industry may adversely affect our operations. We operate in a highly competitive environment. We compete with major, national and independent oil and natural gas companies for

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the acquisition of desirable oil and natural gas properties and the equipment and labor required to develop and operate such properties. Many of these competitors have financial and other resources substantially greater than ours.

The loss of key personnel could adversely affect our ability to successfully execute our strategy. We are a small organization and depend on the skills and experience of a few individuals in key management and operating positions to execute our business strategy. Loss of one or more key individuals in the organization could hamper or delay achieving our strategy.

Tax claims by municipalities in Venezuela may adversely affect Harvest Vinccler’s financial condition. The municipalities of Uracoa and Libertador have asserted numerous tax claims against Harvest Vinccler which we believe are without merit. However, the reliability of Venezuela’s judicial system is a source of concern and it can be subject to local and political influences.

Potential regulations regarding climate change could alter the way we conduct our business. Studies over recent years have indicated that emissions of certain gases may be contributing to warming of the Earth’s atmosphere. In response to these studies, governments have begun adopting domestic and international climate change regulations that requires reporting and reductions of the emission of greenhouse gases. Methane, a primary component of natural gas, and carbon dioxide, a by-product of the burning of oil, gas and refined petroleum products, are considered greenhouse gases. Internationally, the United Nations Framework Convention on Climate Change and the Kyoto Protocol address greenhouse gas emissions, and several countries including the European Union have established greenhouse gas regulatory systems. Any laws or regulations that may be adopted to restrict or reduce emissions of greenhouse gases could require us to incur increased operating and compliance costs, and could have an adverse effect on demand for the oil and gas that we produce and as a result, negatively impact our financial condition, results of operations and cash flows.

Our business is dependent upon the proper functioning of our internal business processes and information systems and modification or interruption of such systems may disrupt our business, processes and internal controls. The proper functioning of our internal business processes and information systems is critical to the efficient operation and management of our business. If these information technology systems fail or are interrupted, our operations may be adversely affected and operating results could be harmed. Our business processes and information systems need to be sufficiently scalable to support the future growth of our business and may require modifications or upgrades that expose us to a number of operational risks. Our information technology systems, and those of third party providers, may also be vulnerable to damage or disruption caused by circumstances beyond our control. These include catastrophic events, power anomalies or outages, natural disasters, computer system or network failures, viruses or malware, physical or electronic break-ins, unauthorized access and cyber attacks. Any material disruption, malfunction or similar challenges with our business processes or information systems, or disruptions or challenges relating to the transition to new processes, systems or providers, could have a material adverse effect on our financial condition, results of operations and cash flows.

Risks Related to the Sale of Our Venezuelan Interests

There is no assurance that the sale of our remaining Venezuelan interests under the Share Purchase Agreement will be completed, and our inability to consummate the proposed sale could harm the market price of our common stock and our business, results of operations and financial condition. If our stockholders fail to authorize the proposed sale of our remaining Venezuelan interests, or if the proposed sale is not completed for any other reason, the market price of our common stock may decline. In addition, failure to complete the proposed sale will result in a reduction in the amount of cash otherwise available to us and, given that we do not currently have any operating cash flow, may substantially limit our ability to implement our business strategy.

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We cannot assure you that the proposed sale of our remaining Venezuelan interests will be consummated. The consummation of the proposed sale is subject to the satisfaction or waiver of a number of conditions, including, among others, the requirement that we obtain stockholder approval of the proposed sale, the requirement that we obtain approval of the proposed sale from the Government of Venezuela, requirements with respect to the accuracy of the representations and warranties of the parties to the Share Purchase Agreement and requirements with respect to the satisfaction or waiver of the covenants and obligations of the parties to the Share Purchase Agreement. In addition, the Share Purchase Agreement may be terminated in certain circumstances under the terms of the Share Purchase Agreement.

We cannot guarantee that the parties to the Share Purchase Agreement will be able to meet all of the second closing conditions. If we are unable to meet all of the second closing conditions, Petroandina would not be obligated to close the proposed sale of our remaining Venezuelan interests. We also cannot be sure that circumstances, such as a material adverse effect, will not arise that would also allow Petroandina to terminate the Share Purchase Agreement before the second closing. If the proposed sale is not approved by our stockholders or does not close for another reason, our Board of Directors will be forced to evaluate other alternatives, which may be less favorable to us than the current proposed sale.

If the Share Purchase Agreement is terminated:

• because our stockholders fail to approve the proposed sale of our remaining Venezuelan interests, we would be required to pay Petroandina a fee of $3.0 million, and Petroandina would have the right to sell back to HNR Energia the 29 percent interest in Harvest Holding acquired in December 2013 at a price equal to the greater of $125 million and the fair market value of the 29 percent interest;

• because our Board of Directors changes or withdraws its recommendation that our stockholders vote to approve the proposed sale of our remaining Venezuelan interests or as a result of our or HNR Energia’s intentional breach of our respective obligations with respect to acquisition proposals, we would be required to pay Petroandina a breakup fee of $9.6 million, and Petroandina would have the right to sell back to HNR Energia its 29 percent interest in Harvest Holding at a price equal to the greater of $125 million and the fair market value of the 29 percent interest;

• as a result of our breach of any representations or warranties on the date of the Share Purchase Agreement that would give rise to the failure of a closing condition, or our breach of covenants, Petroandina would have the right to sell back to HNR Energia its 29 percent interest in Harvest Holding at an exercise price equal to $125 million payable within five business days of the exercise of the option (unless our breach was intentional, in which case we must also pay the positive difference between the fair market value of the 29 percent interest and $125 million within five business days of the determination of fair market value);

• as a result of (i) the second closing not occurring prior to the termination date, (ii) our stockholders having not approved the proposed sale or (iii) our breach of representations, warranties or covenants that gives rise to the failure of a closing condition, then we will also be required to pay Petroandina a breakup fee of $9.6 million if, in certain circumstances, within 12 months of such termination we execute a definitive agreement with respect to, or our Board recommends, an alternative acquisition proposal and we subsequently consummate such an alternative transaction; or

• because our Board of Directors determines to accept a superior proposal (as defined in the Share Purchase Agreement), we would be obligated to pay Petroandina a breakup fee of $9.6 million, and Petroandina would have the right to sell back to HNR Energia its 29 percent interest in Harvest Holding for a purchase price described under the put and call provisions in the Share Purchase Agreement.

In any case where we would be required to repurchase the Petroandina’s 29 percent interest in Harvest Holding, we would not necessarily have sufficient funds to pay for the shares that we are required to repurchase,

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and, given that we do not currently have any operating cash flow, we may need additional funds for the sole purpose of purchasing Petroandina’s 29 percent interest in Harvest Holding which would require us to raise additional capital through equity or debt sales.

In addition, if the proposed sale of our remaining Venezuelan interests is not consummated, our directors, executive officers and other employees will have expended extensive time and effort during the pendency of the sale and we will have incurred significant transaction costs, in each case, without any commensurate benefit.

We are required to obtain the approval of the sale of our Venezuelan interests from the Ministerio del Poder Popular de Petroleo y Mineria representing the Government of Venezuela. There can be no assurances that we will be able to obtain this approval, or that we will be able to obtain this approval on terms reasonably satisfactory to us and Pluspetrol. If this approval is not obtained, then the Share Purchase Agreement may be terminated.

While the proposed sale of our remaining Venezuelan interests is pending, it creates uncertainty about our future that could have a material adverse effect on our business, financial condition and results of operations. While the proposed sale of our remaining Venezuelan interests is pending, it creates uncertainty about our future. As a result of this uncertainty, our current or potential business partners may decide to delay, defer or cancel entering into new business arrangements with us pending completion or termination of the proposed sale. In addition, while the proposed sale is pending, we are subject to a number of risks, including:

• the diversion of management and employee attention from our day-to-day business;

• the potential disruption to business partners and other service providers; and

• the possible inability to respond effectively to competitive pressures, industry developments and future opportunities.

The occurrence of any of these events individually or in combination could have a material adverse effect on our business, financial condition and results of operation.

If the proposed sale of our remaining Venezuelan interests is not completed, there may not be any other offers from potential acquirors. If the proposed sale of our remaining Venezuelan interests is not completed, we may seek another purchaser for our interests in Venezuela. There can be no assurances that we would be able to enter into meaningful discussions or to otherwise complete any transaction with any other party who may have an interest in purchasing our Venezuelan interests on terms acceptable to us.

The Share Purchase Agreement may expose us to contingent liabilities. Under the Share Purchase Agreement, we have agreed to indemnify Petroandina for a breach or inaccuracy of any representation, warranty or covenant made by us in the Share Purchase Agreement, subject to certain limitations. Significant indemnification claims by Petroandina could have a material adverse effect on our financial condition.

There is no guarantee that you will receive any of the net cash proceeds from the proposed sale of our remaining Venezuelan interests in the form of dividends, and we could spend or invest the net cash proceeds from the proposed sale in ways in which our stockholders may not agree. The purchase price for the sale of our interests in Venezuela will be paid directly to us. After the payment of expenses related to the proposed sale (including taxes) and reservation of some of the proceeds for operating costs and contingent liabilities, any use of the remaining proceeds will be at the discretion of our Board of Directors and based on its determination of what is in the best interests of the Company and its stockholders at the time of determination. Our Board of Directors could decide that we should use all or a significant portion of the net cash proceeds from the sale for purposes other than paying dividends, including continuing the Company’s business.

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Item 1B. Unresolved Staff Comments

None.

Item 2. Properties

We have regional office in Singapore and field offices in Jakarta, Indonesia and Port Gentil, Gabon to support field operations in those areas. At December 31, 2013, we had the following lease commitments for office space:

Location	Date Lease Signed	Term		Annual Expense
Houston, Texas	April 2004		10.0 years	$	306,000
Houston, Texas	December 2008		5.6 years		147,000
Caracas, Venezuela	December 2013		1.0 years		92,750
Port Gentil, Gabon	December 2012		2.0 years		61,750
Singapore	October 2012		2.0 years		87,600
Jakarta, Indonesia	April 2012		2.0 years		174,900

See Item 1. Business, Operations for a description of our oil and gas properties.

Item 3. Legal Proceedings

Kensho Sone, et al. v. Harvest Natural Resources, Inc., in the United States District Court, Southern District of Texas, Houston Division. On July 24, 2013, 70 individuals, all alleged to be citizens of Taiwan, filed an original complaint and application for injunctive relief relating to the Company’s interest in the WAB-21 area of the South China Sea. The complaint alleges that the area belongs to the people of Taiwan and seeks damages in excess of $2.9 million and preliminary and permanent injunctions to prevent the Company from exploring, developing plans to extract hydrocarbons from, conducting future operations in, and extracting hydrocarbons from, the WAB-21 area. The Company has filed a motion to dismiss and intends to vigorously defend these allegations.

The following related class action lawsuits were filed on the dates specified in the United States District Court, Southern District of Texas: John Phillips v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (March 22, 2013) (“Phillips case”); Sang Kim v. Harvest Natural Resources, Inc., James A. Edmiston, Stephen C. Haynes, Stephen D. Chesebro’, Igor Effimoff, H. H. Hardee, Robert E. Irelan, Patrick M. Murray and J. Michael Stinson (April 3, 2013); Chris Kean v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (April 11, 2013); Prastitis v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (April 17, 2013); Alan Myers v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (April 22, 2013); and Edward W. Walbridge and the Edward W. Walbridge Trust v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (April 26, 2013). The complaints allege that the Company made certain false or misleading public statements and demand that the defendants pay unspecified damages to the class action plaintiffs based on stock price declines. All of these actions have been consolidated into the Phillips case. The Company and the other named defendants have filed a motion to dismiss and intend to vigorously defend the consolidated lawsuits.

In June 2012, the operator of the Budong PSC received notice of a claim related to the ownership of part of the land comprising the Karama-1 (“KD-1”) drilling site. The claim asserts that the land on which the drill site is located is partly owned by the claimant. The operator purchased the site from local landowners in January 2010, and the purchase was approved by BPMIGAS, Indonesia’s oil and gas regulatory authority. The claimant is seeking compensation of 16 billion Indonesia Rupiah (approximately $1.4 million, $1.0 million net to our 71.61 percent cost sharing interest) for land that was purchased at a cost of $4,100 in January 2010. On March 8, 2013, the court ruled to dismiss the claim because the claim had not been filed against the proper parties to the claim. On March 19, 2013, the claimant filed an appeal against the judgment. We dispute the claim and plan to vigorously defend against it.

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In May 2012, Newfield Production Company (“Newfield”) filed notice pursuant to the Purchase and Sale Agreement between Harvest (US) Holdings, Inc. (“Harvest US”), a wholly owned subsidiary of Harvest, and Newfield dated March 21, 2011 (the “PSA”) of a potential environmental claim involving certain wells drilled on the Antelope Project. The claim asserts that locations constructed by Harvest US were built on, within, or otherwise impact or potentially impact wetlands and other water bodies. The notice asserts that, to the extent of potential penalties or other obligations that might result from potential violations, Harvest US must indemnify Newfield pursuant to the PSA. In June 2012, we provided Newfield with notice pursuant to the PSA (1) denying that Newfield has any right to indemnification from us, (2) alleging that any potential environmental claim related to Newfield’s notice would be an assumed liability under the PSA and (3) asserting that Newfield indemnify us pursuant to the PSA. We dispute Newfield’s claims and plan to vigorously defend against them.

On May 31, 2011, the United Kingdom branch of our subsidiary, Harvest Natural Resources, Inc. (UK), initiated a wire transfer of approximately $1.1 million ($0.7 million net to our 66.667 percent interest) intending to pay Libya Oil Gabon S.A. (“LOGSA”) for fuel that LOGSA supplied to our subsidiary in the Netherlands, Harvest Dussafu, B.V., for the company’s drilling operations in Gabon. On June 1, 2011, our bank notified us that it had been required to block the payment in accordance with the U.S. sanctions against Libya as set forth in Executive Order 13566 of February 25, 2011, and administered by OFAC, because the payee, LOGSA, may be a blocked party under the sanctions. The bank further advised us that it could not release the funds to the payee or return the funds to us unless we obtain authorization from OFAC. On October 26, 2011, we filed an application with OFAC for return of the blocked funds to us. Until that application is approved, the funds will remain in the blocked account, and we can give no assurance when OFAC will permit the funds to be released. Our October 26, 2011 application for the return of the blocked funds remains pending with OFAC.

Robert C. Bonnet and Bobby Bonnet Land Services vs. Harvest (US) Holdings, Inc., Branta Exploration & Production, LLC, Ute Energy LLC, Cameron Cuch, Paula Black, Johnna Blackhair, and Elton Blackhair in the United States District Court for the District of Utah. This suit was served in April 2010 on Harvest and Elton Blackhair, a Harvest employee, alleging that the defendants, among other things, intentionally interfered with plaintiffs’ employment agreement with the Ute Indian Tribe – Energy & Minerals Department and intentionally interfered with plaintiffs’ prospective economic relationships. Plaintiffs seek actual damages, punitive damages, costs and attorney’s fees. We dispute plaintiffs’ claims and plan to vigorously defend against them. On October 29, 2013, we learned that the court administratively closed the case. The case was recently reopened as a result of the Circuit Court of Appeals’ ruling against Plaintiffs’ discovery request. We dispute Plaintiffs’ claims and plan to vigorously defend against them.

Uracoa Municipality Tax Assessments. Harvest Vinccler S.C.A., a subsidiary of Harvest Holding (“Harvest Vinccler”), has received nine assessments from a tax inspector for the Uracoa municipality in which part of the Uracoa, Tucupita and Bombal fields are located as follows:

• Three claims were filed in July 2004 and allege a failure to withhold for technical service payments and a failure to pay taxes on the capital fee reimbursement and related interest paid by PDVSA under the Operating Service Agreement (“OSA”). Harvest Vinccler has filed a motion with the Tax Court in Barcelona, Venezuela, to enjoin and dismiss one of the claims and has protested with the municipality the remaining claims.

• Two claims were filed in July 2006 alleging the failure to pay taxes at a new rate set by the municipality. Harvest Vinccler has filed a protest with the Tax Court in Barcelona, Venezuela, on these claims.

• Two claims were filed in August 2006 alleging a failure to pay taxes on estimated revenues for the second quarter of 2006 and a withholding error with respect to certain vendor payments. Harvest Holding has filed a protest with the Tax Court in Barcelona, Venezuela, on one claim and filed a protest with the municipality on the other claim.

• Two claims were filed in March 2007 alleging a failure to pay taxes on estimated revenues for the third and fourth quarters of 2006. Harvest Vinccler has filed a protest with the municipality on these claims.

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Harvest Vinccler disputes the Uracoa tax assessments and believes it has a substantial basis for its positions based on the interpretation of the tax code by SENIAT (the Venezuelan income tax authority), as it applies to operating service agreements, Harvest Holding has filed claims in the Tax Court in Caracas against the Uracoa Municipality for the refund of all municipal taxes paid since 1997.

Libertador Municipality Tax Assessments. Harvest Vinccler has received five assessments from a tax inspector for the Libertador municipality in which part of the Uracoa, Tucupita and Bombal fields are located as follows:

• One claim was filed in April 2005 alleging the failure to pay taxes at a new rate set by the municipality. Harvest Vinccler has filed a protest with the Mayor’s Office and a motion with the Tax Court in Barcelona, Venezuela, to enjoin and dismiss the claim. On April 10, 2008, the Tax Court suspended the case pending a response from the Mayor’s Office to the protest. If the municipality’s response is to confirm the assessment, Harvest Holding will defer to the Tax Court to enjoin and dismiss the claim.

• Two claims were filed in June 2007. One claim relates to the period 2003 through 2006 and seeks to impose a tax on interest paid by PDVSA under the OSA. The second claim alleges a failure to pay taxes on estimated revenues for the third and fourth quarters of 2006. Harvest Vinccler has filed a motion with the Tax Court in Barcelona, Venezuela, to enjoin and dismiss both claims.

• Two claims were filed in July 2007 seeking to impose penalties on tax assessments filed and settled in 2004. Harvest Vinccler has filed a motion with the Tax Court in Barcelona, Venezuela, to enjoin and dismiss both claims.

Harvest Vinccler disputes the Libertador allegations set forth in the assessments and believes it has a substantial basis for its position. As a result of the SENIAT’s interpretation of the tax code as it applies to operating service agreements, Harvest Vinccler has filed claims in the Tax Court in Caracas against the Libertador Municipality for the refund of all municipal taxes paid since 2002.

On May 4, 2012, Harvest Vinccler learned that the Political Administrative Chamber of the Supreme Court of Justice issued a decision dismissing one of Harvest Vinccler’s claims against the Libertador Municipality. Harvest Vinccler continues to believe that it has sufficient arguments to maintain its position in accordance with the Venezuelan Constitution. Harvest Vinccler plans to present a request of Constitutional Revision to the Constitutional Chamber of the Supreme Court of Justice once it is notified officially of the decision. Harvest Vinccler has not received official notification of the decision. Harvest Vinccler is unable to predict the effect of this decision on the remaining outstanding municipality claims and assessments.

On February 21, 2014, Tecnica Vial and Flamingo, our partners in Colombia on Blocks VSM14 and VSM15, respectively, filed for arbitration of claims related to the farmout agreements for each block. We had received notices of default from our partners for failing to comply with certain terms of the farmout agreements, followed by notices of termination on November 27, 2013. We determined that it was appropriate to fully impair the costs associated with these interests, and we recorded an impairment charge of $3.2 million during the year ended December 31, 2013 which includes an accrual of $2 million related to this matter. We intend to vigorously defend the arbitration.

We are a defendant in or otherwise involved in other litigation incidental to our business. In the opinion of management, there is no such litigation that will have a material adverse effect on our financial condition, results of operations and cash flows.

Item 4. Mine Safety Disclosures

Not applicable.

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PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Price Range of Common Stock and Dividend Policy

Our common stock is traded on the New York Stock Exchange (“NYSE”) under the symbol “HNR”. As of December 31, 2013, there were 42,114,346 shares of common stock outstanding, with approximately 424 stockholders of record. The following table sets forth the high and low sales prices for our Common Stock reported by the NYSE.

Year	Quarter	High		Low
2012	First quarter		8.27		6.14
	Second quarter		9.12		4.88
	Third quarter		9.85		7.72
	Fourth quarter		9.50		8.38
2013	First quarter		10.25		3.38
	Second quarter		3.72		2.80
	Third quarter		5.25		3.44
	Fourth quarter		5.88		2.83

On March 7, 2014, the last sales price for the common stock as reported by the NYSE was $4.18 per share.

Historically, our policy has been to retain earnings to support the growth of our business, and accordingly, our Board of Directors has never declared a cash dividend on our common stock. However, should the sale of our remaining interests in Venezuela be completed, a substantial portion of our assets would be cash proceeds from such sale, and our Board of Directors would evaluate alternative uses of the cash proceeds, including a possible distribution to the Company’s stockholders. See Part 1. Item 1. Business, Business Strategy for further discussion.

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Stock Performance Graph

The graph below shows the cumulative total stockholder return over the five-year period ending December 31, 2013, assuming an investment of $100 on December 31, 2008 in each of Harvest’s common stock, the Dow Jones U.S. Exploration & Production Index and the S&P Composite 500 Stock Index.

This graph assumes that the value of the investment in Harvest stock and each index was $100 at December 31, 2008 and that all dividends were reinvested.

PLOT POINTS

(December 31 of each year)

	2008		2009		2010		2011		2012		2013
Harvest Natural Resources, Inc.	$	100	$	123	$	283	$	172	$	211	$	105
Dow Jones US E&P Index	$	100	$	141	$	169	$	164	$	172	$	226
S&P 500 Index	$	100	$	126	$	146	$	149	$	172	$	228

Total Return Data provided by S&P’s Institutional Market Services, Dow Jones & Company, Inc. is composed of companies that are classified as domestic oil companies under Standard Industrial Classification codes (1300-1399, 2900-2949, 5170-5179 and 5980-5989). The Dow Jones US Exploration & Production Index is accessible at http://www.djindexes.com/mdsidx/index.cfm?event=showTotalMarket.

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Item 6. Selected Financial Data

SELECTED CONSOLIDATED FINANCIAL DATA

The following tables set forth our selected consolidated financial data for each of the years in the five-year period ended December 31, 2013.

	Year Ended December 31,
	2013			2012			2011			2010			2009
	(in thousands, except per share data)
Consolidated Statements of Operations:
Operating loss	$	(45,436	)	$	(38,826	)	$	(77,155	)	$	(32,774	)	$	(29,705	)
Earnings from Equity Affiliates		72,578			67,769			73,451			66,291			35,253
Income (loss) from continuing operations (1)		(83,946	)		2,199			(30,285	)		12,615			(2,384	)
Net income (loss) attributable to Harvest		(89,096	)		(12,211	)		55,960			14,375			(3,568	)
Income (loss) from continuing operations attributable to Harvest per common share:
Basic (1)	$	(2.12	)	$	0.06		$	(0.89	)	$	0.38		$	(0.07	)
Diluted (1)	$	(2.12	)	$	0.06		$	(0.89	)	$	0.34		$	(0.07	)
Weighted average common shares outstanding
Basic		39,579			37,424			34,117			33,541			33,084
Diluted		39,579			37,591			34,117			36,767			33,084

⁽¹⁾  Reduced for net income attributable to noncontrolling interests.

	As of December 31,
	2013		2012		2011		2010		2009
	(in thousands)
Balance Sheet Data:
Total assets	$	734,880	$	596,837	$	507,203	$	484,622	$	345,214
Long-term debt, net of current maturities		0		74,839		31,535		78,291		0
Total Harvest’s Stockholders’ equity (1)		302,630		379,337		355,691		291,727		271,603

⁽¹⁾ No cash dividends were declared or paid during the periods presented.

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Operations

We had a net loss attributable to Harvest of $(89.1) million, or $(2.25) per diluted share, for the year ended December 31, 2013 compared to a net loss attributable to Harvest of $(12.2) million, or $(0.33) per diluted share, for the year ended December 31, 2012. Net loss attributable to Harvest for the year ended December 31, 2013 includes $15.2 million of exploration expense, $0.6 million of impairment expense, $3.5 million of unrealized gain on warrant derivatives, $23.0 million of loss on sale of interest in affiliate, $73.1 of income tax expense (including $89.9 million of accrued income tax expense related to previously unrecognized income tax on undistributed earnings for foreign subsidiaries), net equity income from Petrodelta’s operations of $72.6 million and a loss from discontinued operations of $(5.2) million. Net loss attributable to Harvest for the year ended December 31, 2012 includes $8.8 million of exploration expense, $2.9 million of impairment expense, $0.7 million of dry hole costs, net equity income from Petrodelta’s operations of $67.8 million and a loss from discontinued operations of $(14.4) million.

Petrodelta

See Item 1. Business, Share Purchase Agreement and Operations, Petrodelta.

Petrodelta’s shareholders intend that the company be self-funding and rely on internally-generated cash flow to fund operations. Petrodelta’s 2013 approved capital budget was $210 million and included a drilling program to use five drilling rigs for both development and appraisal wells to maintain production capacity. Actual capital expenditures were $269.2 million in 2013 or 28 percent over the approved budget due to cost overruns and inefficiencies.

Petrodelta began 2013 with three drilling rigs and two workover rigs and projects in progress to enhance the infrastructure in the El Salto and Temblador fields and to construct a pipeline between the Isleño field and the main production facility at Uracoa. Currently, Petrodelta is operating six drilling rigs and one workover rig and is continuing the construction on the infrastructure enhancements in the El Salto and Temblador fields. Construction of the pipeline between the Isleño field and the main production facility at Uracoa was completed in March 2013.

During the year ended December 31, 2013, Petrodelta drilled and completed 13 development wells compared to 12 development wells in the year ended December 31, 2012. Petrodelta delivered approximately 14.5 MBls of oil and 2.6 Bcf of natural gas, averaging 41,014 BOE per day during the year ended December 31, 2013 compared to deliveries of 13.2 MBls of oil and 2.2 Bcf of natural gas, averaging 36,979 BOE per day during the year ended December 31, 2012.

Petrodelta’s Proved reserves, net to our 20.4 percent interest, are 20.7 MMBOE at December 31, 2013. Petrodelta’s Probable reserves, net to our 20.4 percent interest, are 41.5 MMBOE at December 31, 2013. Petrodelta’s Possible reserves, net to our 20.4 percent interest, are 62.9 MMBOE. Proved plus Probable reserves at 62.2 MMBOE, after accounting for the reduction in our interest from 32.0 percent to 20.4 percent, are virtually unchanged from last year. See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, Critical Accounting Policies – Reserves for a definition of proved, probable and possible reserves and a discussion of the uncertainty related to such reserve estimates.

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Certain operating statistics for the years ended December 31, 2013, 2012 and 2011 for the Petrodelta fields operated by Petrodelta are set forth below. This information is provided at 100 percent.

	December 31,
	2013		2012		2011
Thousand barrels of oil sold		14,538		13,172		11,390
Million cubic feet of gas sold		2,593		2,171		2,266
Total thousand barrels of oil equivalent		14,970		13,534		11,768
Average price per barrel	$	91.22	$	95.91	$	98.52
Average price per thousand cubic feet	$	1.54	$	1.54	$	1.54
Cash operating costs (thousands) (a)	$	151,661	$	121,023	$	77,236
Capital expenditures (thousands)	$	269,239	$	184,202	$	137,518

^(a)  See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, Results of Operations, Years Ended December 31, 2013 and 2012, Equity in Earnings from Equity Affiliates and Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, Results of Operations, Years Ended December 31, 2012 and 2011, Equity in Earnings from Equity Affiliates

Sales Contract

Under Petrodelta’s Sales Contract, crude oil delivered from the Petrodelta fields to PPSA is priced with reference to Merey 16 published prices, weighted for different markets and adjusted for variations in gravity and sulphur content, commercialization costs and distortions that may occur given the reference price and prevailing market conditions. Merey 16 published prices are quoted and sold in U.S. Dollars. Natural gas delivered from the Petrodelta Fields to PDVSA is priced at $1.54 per thousand cubic feet. PPSA is obligated to make payment to Petrodelta in U.S. Dollars in the case of payment for crude oil and natural gas liquids delivered. Natural gas deliveries are paid in Bolivars, but the pricing for natural gas is referenced to the U.S. Dollar.

Beginning in October 2011, MENPET determined that Petrodelta’s production flowing through the COMOR transfer point which comes from the El Salto field was a heavier type of crude, Boscan. The official pricing formula applied to Boscan by MENPET is used for the sales of Petrodelta crude oil with quality close to 10 degrees API to represent actual quality delivered. PPSA and Petrodelta are in the process of amending the contract to provide pricing under both the Merey 16 and Boscan pricing formulas. Once the Sales Contract is executed, PPSA will be invoiced for the deliveries. As of December 31, 2013, $756.7 million ($352.7 million in 2012) for El Salto remain uninvoiced to PPSA pending execution of the amendment.

Payments to Contractors

In Item 1A. Risk Factors, we disclosed that PDVSA’s failure to timely pay contractors, including Petrodelta, was having an adverse effect on Petrodelta. We have advanced certain costs on behalf of Petrodelta. These costs include consultants in engineering, drilling, operations and seismic interpretation, and employee salaries and related benefits for Harvest employees seconded into Petrodelta. Currently, we have three employees seconded into Petrodelta. Costs advanced are invoiced on a monthly basis to Petrodelta. We are considered a contractor to Petrodelta, and as such, we are also experiencing the slow payment of invoices. As of December 31, 2013, we had $2.9 million outstanding for unpaid advances to Petrodelta for continuing operations costs. Although payment is slow, payments continue to be received. Petrodelta and Petrodelta’s board have not indicated that the advances are not payable, nor that they will not be paid. At December 31, 2013, has reflected all of the $2.9 million of the Advances to Affiliate as a long-term receivable due to slow payment and age of the advances.

We are unable to provide an indication of when PDVSA will become and remain current in its payment obligations. However, we believe that PDVSA’s debt will not disappear completely in the short term, but the risk of contractor work stoppage is minimal due to PDVSA guaranteeing payments as publicly stated by top officials. Increased costs due to PDVSA’s debt financing are already imbedded in current contractor’s rates.

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In the past, there has been insufficient monetary support and contractual adherence by PDVSA, it is possible that PDVSA will not provide the support required to execute Petrodelta’s proposed 2014 budget. Should PDVSA continue in insufficient monetary support and contractual adherence of Petrodelta, underinvestment in the development plan may lead to continued under-performance. The 2014 budget proposal has not been reviewed by Petrodelta’s board yet.

Windfall Profits Tax

In April 2011, the Venezuelan government published in the Official Gazette the Law Creating a Special Contribution on Extraordinary Prices and Exorbitant Prices in the International Hydrocarbons Market (“Windfall Profits Tax”). In February 2013, the Venezuelan government published in the Official Gazette an amendment to the Windfall Profits Tax which established new levels for contribution to the Venezuelan government. Extraordinary prices are considered to be equal to or lower than $80 per barrel, and exorbitant prices are considered to be over $80 per barrel. See Item 15. Exhibits and Financial Statement Schedules, Notes to the Consolidated Financial Statements (“Notes to Consolidated Financial Statements”), Note 6 – Investment in Equity Affiliates for further discussion of the Windfall Profits Tax rates. Windfall Profits Tax is deductible for Venezuelan income tax purposes.

The April 2011 Windfall Profits Tax included a provision wherein it considered that an exemption of the Windfall Profits Tax could be granted for the incremental production of projects and grass root developments until the specific investments are recovered. The projects deemed to qualify for the exemption have to be considered and approved on a case by case basis by MENPET. In March 2013, PDVSA requested an exemption from MENPET for the Windfall Profits Tax under the provision in the April 2011 Windfall Profits Tax law. PDVSA issued to Petrodelta its share of the exemption credit for 2012 of $55.2 million ($36.4 million net of tax) ($11.3 million net to our 20.4 percent interest, $7.4 million net of tax net to our 20.4 percent interest) based on PDVSA’s calculation and projects PDVSA deemed to qualify for the exemption. Petrodelta has not been provided with supporting documentation indicating the properties have been appropriately qualified by MENPET, the specific details for the exemption credit, such as which fields, production period or production, or the supporting calculations. Until MENPET either issues guidance on the exemption provision in the April 2011 Windfall Profits Tax law or issues payment forms including the exemption credit, or written approval from MENPET for this exemption credit is received by Petrodelta or us, we have and will continue to exclude the exemption credit from our equity earnings in Petrodelta.

Royalty Cap

Royalties are paid at 33.33 percent with the 30 percent royalty paid in-kind and the 3.33 percent royalty paid in cash. The amended Windfall Profits Tax states that royalties paid to Venezuela are capped at $80 per barrel ($70 per barrel in 2012). The law does not specify whether the cap on royalties is applicable to in-cash, in-kind, or both. Per instructions received from PDVSA, Petrodelta reports royalties, whether paid in-cash or in-kind, at $80 per barrel (royalty barrels x $80). Per our interpretation of the Windfall Profits Tax law and as required under U.S. GAAP, the $80 cap on royalty barrels should only be applied to the 3.33 percent royalty which Petrodelta pays in cash. The revenues and royalties in Results of Operations, Earnings from Equity Affiliates, have been adjusted to report royalties paid in-kind at the oil price applicable for the period. While both methods of reporting result in the same amount being reported for net sales, our method results in prices per barrel of oil which are consistent with the prices expected under the Sales Contract. See Notes to Consolidated Financial Statements, Note 6 – Investment in Equity Affiliates for further discussion of the amounts reported for royalties.

Sports Law

The Organic Law on Sports, Physical Activity and Physical Education (“Sports Law”) was published in the Official Gazette on August 23, 2011 and is effective beginning January 1, 2012. Per the Sports Law,

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contributions are to be calculated on an after-tax basis. However, CVP has instructed Petrodelta to calculate the contribution on a before-tax basis contrary to the Sports Law resulting in an overstatement of the liability. We have adjusted for the over-accrual of the Sports Law in the years ended December 31, 2013 and 2012 Earnings from Equity Affiliate. As of December 31, 2013, the cumulative amount of this adjustment is $1.3 million ($0.3 million net to our 20.4 percent interest).

Functional Currency

Petrodelta’s functional and reporting currency is the U.S. Dollar. It has currency exchange risk from fluctuations of the official prevailing exchange rate that applies to their operating costs denominated in Venezuela Bolivars (“Bolivars”). The monetary assets that are exposed to exchange rate fluctuations are cash, accounts receivable, prepaid expenses and other current assets. The monetary liabilities that are exposed to exchange rate fluctuations are accounts payable, accruals, current and deferred income tax and other tax obligations and other current liabilities. All monetary assets and liabilities incurred at the official Bolivar exchange rate are settled at the official Bolivar exchange rate. The official prevailing currency exchange rate was increased from 4.3 Bolivars per U.S. Dollar to 6.3 Bolivars per U.S. Dollar in February 2013. Petrodelta reflected a gain of approximately $169.6 million on revaluation of its non-income tax related assets and liabilities during the year ended December 31, 2013 primarily related to the February 2013 devaluation.

As a result of legislation enacted in December 2013 and January and February of 2014, Venezuela now has a multiple exchange rate system. Most of Petrodelta’s transactions are subject to a fixed official exchange rate of 6.3. In addition, there is a variable official exchange rate system in which the exchange rate is determined through auctions (11.3 rate as of December 31, 2013). The third system is not yet available as the government has not yet specified the scope of application and mechanics. The financial information is prepared using the official fixed exchange rate (6.3 from February 2013 through December 2013). At December 31, 2013, the balances in Petrodelta’s Bolivar denominated monetary assets and liabilities accounts that are exposed to exchange rate changes are 1,011 million Bolivars and 6,683 million Bolivars, respectively.

Petrodelta’s results were also impacted by PDVSA changing its policy with respect to invoicing for disbursements made in Bolivars on behalf of Petrodelta to require that such invoices be denominated in U.S. dollars rather than Bolivars. This change was implemented in the fourth quarter of 2013 with retroactive application to certain transactions occurring in 2011 and thereafter. As a result of this change, Petrodelta recorded a $14.2 million foreign currency loss in the three months ended December 31, 2013.

Collective Labor Agreement

On February 11, 2014, the Collective Labor Agreement for the period from October 1, 2013 thru October 1, 2015, between the employees of the oil industry represented by the Venezuelan Unitary Federation of workers of the oil, gas, and derivatives (FUTPV) and PDVSA was signed. The Collective Labor Agreement establishes a salary raise and payroll and retirement benefits which has a significant impact on Petrodelta’s payroll cost. The most significant impact is a step increase of salary around 90%, where 59% is to be retroactive from October 1, 2013, then a 23% raise from May 1, 2014 and finally the remaining portion to be adjusted on January 1, 2015.

Dividends

On November 12, 2010, Petrodelta’s board of directors declared a dividend of $30.6 million, $12.2 million net to HNR Finance. Petrodelta shareholder approval of the dividend was received on March 14, 2011. Petrodelta had working capital of $253.8 million as of December 31, 2013; however, due to Petrodelta’s liquidity constraints caused by PDVSA’s insufficient monetary support and contractual adherence, this dividend has not yet been received, although it is due and payable, and dividends for subsequent periods have not been declared and/or paid. Petrodelta’s board of directors declared this dividend and has neither indicated that the dividend is not payable, nor that it will not be paid. Petrodelta has consistently earned a profit from 2007 through September 30, 2013; however, dividends of profits since 2010 have not been declared. There is uncertainty with

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respect to the timing of the receipt of the dividend declared in November 2010 or whether future dividends will be declared and/or paid. During the term of the Share Purchase Agreement, Harvest Holding may not pay any dividends to HNR Energia, and therefore would not benefit from any dividends paid by Petrodelta during this period. Should this receivable be paid and subsequently distributed to Harvest Holding’s shareholders prior to the second closing sale to Petroandina, we would not receive any portion of the dividend.

Petrodelta’s results and operating information is more fully described in Notes to the Consolidated Financial Statements, Note 6 – Investment in Equity Affiliates.

Dussafu Project – Gabon

We have a 66.667 percent ownership interest in the Dussafu PSC through two separate acquisitions, and we are the operator. The Dussafu PSC partners and Gabon, represented by the Ministry of Mines, Energy, Petroleum and Hydraulic Resources, is in the third exploration phase of the Dussafu PSC which has been extended to May 27, 2016.

During 2011, we drilled our first exploratory well, Dussafu Ruche Marin-1 (“DRM-1”), and two appraisal sidetracks. DRM-1 and sidetracks discovered oil of approximately 149 feet of pay within the Gamba and Middle Dentale Formations. DRM-1 and sidetracks are currently suspended pending further exploration and development activities.

During the fourth quarter of 2012, our second exploration well on the Tortue prospect to target stacked pre-salt Gamba and Dentale reservoirs commenced. DTM-1 was spud on November 19, 2012 in a water depth of 380 feet. On January 4, 2013, we announced that DTM-1 had reached a vertical depth of 11,260 feet within the Dentale Formation. Log evaluation and pressure data indicate that we have an oil discovery of approximately 42 feet of pay in a 72-foot column within the Gamba Formation and 123 feet of pay in stacked reservoirs within the Dentale Formation. The first appraisal sidetrack of DTM-1 (“DTM-1ST1”) was spud in January 12, 2013. DTM-1ST1 was drilled to a total depth of 11,385 feet in the Dentale Formation, approximately 1,800 feet from DTM-1 wellbore and found 65 feet of pay in the primary Dentale reservoir. Work on DTM-1 and DTM-1ST1 was suspended pending future appraisal and development activities.

Geoscience, reservoir engineering and economic studies have progressed and a field development plan is being prepared for a cluster field development of both the Ruche and Tortue discoveries along with existing pre-salt discoveries at Walt Whitman and Moubenga. Following the success in both the pre-salt Gamba and Dentale reservoirs in the two Harvest exploration wells a new 1,130 square kilometer 3D seismic survey commenced in October with the first high quality seismic products expected to be available during the second quarter of 2014. The new 3D seismic data was extended to be acquired over the two Harvest discoveries and should also enhance the placement of future development wells in the Ruche and Tortue development program. We continue to evaluate our prospects, but we have not drilled any additional wells.

During the year ended December 31, 2013, we had cash capital expenditures of $42.5 million for well costs ($11.7 million for well costs during the year ended December 31, 2012). The 2014 budget for the Dussafu PSC is $7.4 million. See Item 1. Business, Operations, Dussafu Marin, Offshore Gabon for further information on the Dussafu Project.

Budong-Budong Project, Indonesia

See Item 1. Business, Operations, Budong-Budong, Onshore Indonesia.

In January 2013, the Budong PSC partners were granted a four year extension of the initial six year exploration term of the Budong PSC to January 15, 2017. The extension of the initial exploration term includes an exploration well, which if not drilled by January 2016, results in the obligation of the Joint Venture to return the entire Budong PSC to the Government of Indonesia.

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In December 2012, we signed a farmout agreement with the operator of the Budong PSC to acquire an additional 7.1 percent participating interest and to become operator of the Budong PSC. We assumed the role of interim operator effective January 16, 2013. Closing of this acquisition will increase our participating ownership interest in the Budong PSC to 71.5 percent with our cost sharing interest becoming 72 percent until first commercial production. The consideration for this transaction is that we will fund 100 percent of the costs of the first exploration well of the four-year extension to the Budong PSC. If we do not drill an exploration well before October 2014, our partner has the right to give us notice that the consideration for the additional 7.1 percent participating interest must be paid in cash for $3.2 million.

Operational activities during the year ended December 31, 2013 included continued work on an exploration program targeting the Pliocene and Miocene targets encountered in the two exploratory wells drilled in 2011. Land access and acquisition; environmental studies; construction and upgrades to access roads, bridges, and well site; permitting; and tender prequalification and procurement are on-going.

We are actively discussing the sale of our interests in Budong, and based on indications of interest received in December 2013, we determined that is it was appropriate to recognize and impairment expense of $0.6 million and a charge included in general and administrative expenses related to a valuation allowance on VAT we do not expect to recover of $2.8 million.

During the year ended December 31, 2013, we had cash capital expenditures of $0.2 million ($5.8 million during the year ended December 31, 2012) for deepening and plugging and abandonment costs. The 2014 budget for the Budong PSC is $1.0 million.

WAB-21 Project – China

In March 2011, CNOOC granted us an extension to May 2013 of Phase One of the Exploration Period for the WAB-21 contract area. The Joint Management Committee has approved an extension of the license until May 31, 2015. While no assurance can be given, we believe we will continue to receive contract extensions so long as the border disputes with Vietnam persist. Even though there continues to be increasing activity on the Vietnamese blocks which we believe confirms our view of WAB-21’s prospectivity, we impaired the carrying value of WAB-21 of $2.9 million at December 31, 2012 due to our continued inability to pursue an exploration program. However, we continue to seek permission to acquire regional 2-D seismic and localized 3-D seismic.

Operational activities during 2013 include costs related to maintenance of the license. The 2014 budget for WAB 21 is minimal, consisting of costs required to maintain the license. See Item 1. Business, Operations, WAB-21, South China Sea for further information on the WAB-21 Project.

Colombia – Discontinued Operations

In February 2013, we signed farmout agreements on Block VSM14 and Block VSM15 in Colombia. Under the terms of the farm-out agreements, we had a 75 percent beneficial working interest and our partners had a 25 percent carried interest for the minimum exploratory work commitments on each block. We requested the legal assignment of the interest by the Agencia Nacional de Hidrocarburos (“ANH”), Colombia’s oil and gas regulatory authority, and approval of us as operator.

For both blocks, phase one of the contract began on December 15, 2012 and expires on December 15, 2015. We have received notices of default from our partners for failing to comply with certain terms of the farmout agreements for Block VSM 14 and Block VSM 15, followed by notices of termination on November 27, 2013. As discussed further in “Item 3. Legal Proceedings”, our partners have filed for arbitration of claims related to these agreements. After evaluating these circumstances, we determined that it was appropriate to fully impair the costs associated with these interests, and we recorded an impairment charge of $3.2 million during the year ended December 31, 2013. As we no longer have any interests in Colombia, we have reflected the results in

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discontinued operations. During the year ended December 31, 2013 we had capital expenditures of $1.2 million for leasehold acquisition costs. See Item 1. Business, Operations, Colombia for further information on this project.

Block 64 EPSA Project – Oman – Discontinued Operations

On March 12, 2013, we elected to not request an extension of the First Phase or enter the Second Phase of Block 64 EPSA. The carrying value of Block 64 EPSA of $6.4 million was considered to be impaired and a related impairment expense was recorded during the year ended December 31, 2012. During the first half of 2013, Block 64 was relinquished effective May 23, 2013 and we terminated our operations and closed the field office. Our activities in Oman have been reflected as discontinued operations in our financial statements. See Item 1. Business, Operations, Block 64 EPSA, Oman for further information on the Block 64 EPSA Project.

Business Strategy

In Item 1. Business and Item 1A. Risk Factors, we discuss the situation in Venezuela and how the actions of the Venezuelan government have and continue to adversely affect our operations. The expectation that dividends from Petrodelta will be minimal over the next few years has restricted our available cash and had a significant adverse effect on our ability to obtain financing to acquire and develop growth opportunities elsewhere. Upon consideration of these and other factors, on December 16, 2013, Harvest and HNR Energia entered into the Share Purchase Agreement with Petroandina and Pluspetrol to sell all of our 80 percent equity interest in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement, when we sold a 29 percent equity interest in Harvest Holding for $125 million. The second closing, for the sale of a 51 percent equity interest in Harvest Holding for a cash purchase price of $275 million, will be subject to, among other things, approval by the holders of a majority of our common stock and approval by the Ministerio del Poder Popular de Petroleo y Mineria representing the Government of Venezuela (which indirectly owns the other 60 percent interest in Petrodelta). See Item 1. Business, Share Purchase Agreement.

We are currently marketing our non-Venezuelan assets and talking to potential buyers, and we intend to continue our consideration of a possible sale for some or all of our non-Venezuelan assets if we are able to negotiate a sale or sales in transactions that our Board of Directors believes are in the best interests of the Company and its stockholders. In the meantime, we intend to operate our business in the ordinary course and may ultimately decide to keep our non-Venezuelan assets and acquire additional assets. See Item 1. Business,Business Strategy for further discussion on how we plan to operate the business in the near term.

Results of Operations

The following discussion on results of operations for each of the years in the three-year period ended December 31, 2013 should be read in conjunction with our consolidated financial statements and related notes thereto.

Years Ended December 31, 2013 and 2012

We reported a net loss attributable to Harvest of $(89.1) million, or $(2.25) diluted earnings per share, for the year ended December 31, 2013, compared with a net loss attributable to Harvest of $(12.2) million, or $(0.33) diluted earnings per share, for the year ended December 31, 2012.

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Loss From Continuing Operations

Expenses and other non-operating (income) expense from continuing operations (in thousands) were:

	Year Ended December 31,						Increase (Decrease)
	2013			2012
Depreciation and amortization	$	341		$	391		$	(50	)
Exploration expense		15,155			8,838			6,317
Impairment expense		575			2,900			(2,325	)
Dry hole costs		0			685			(685	)
General and administrative		29,365			26,012			3,353
Investment earnings and other		(280	)		(348	)		68
Loss on sale of interest in Harvest Holding		22,994			0			22,994
Unrealized (gain) loss on derivatives		(3,517	)		600			(4,117	)
Interest expense		4,495			1,590			2,905
Debt conversion expense		0			3,645			(3,645	)
Loss on extinguishment of debt		0			5,425			(5,425	)
Foreign currency transaction losses		820			113			707
Other non-operating expenses		1,849			2,905			(1,056	)
Income tax expense (benefit)		73,087			(609	)		73,696

Our accounting method for oil and gas properties is the successful efforts method. During the year ended December 31, 2013, we incurred $13.7 million of exploration costs for the processing and reprocessing of seismic data related to ongoing operations and $1.5 million related to other general business development activities. During the year ended December 31, 2012, we incurred $4.5 million of exploration costs for the processing and reprocessing of seismic data related to ongoing operations, $2.5 million related to other general business development activities, and $1.8 million related to lease maintenance.

During the year ended December 31, 2013, we impaired $0.6 million related to our Budong project in Indonesia. During the year ended December 31, 2012, we impaired $2.9 million related to the carrying value of WAB-21.

During the year ended December 31, 2013, we did not record any dry hole costs. During the year ended December 31, 2012, we expensed to dry hole costs $0.7 million related to the drilling of the KD-1 well on the Budong PSC.

The increase in general and administrative costs in the year ended December 31, 2013 from the year ended December 31, 2012, was primarily due to higher professional fees and contract services ($1.2 million), general operations and overhead $2.5 million and restructuring costs ($3.0 million), offset by lower employee related costs ($3.3 million).

The unrealized gain on derivatives in the year ended December 31, 2013 as compared to an unrealized loss for the year ended December 31, 2012 was due to a reduction in the estimated fair value for our warrant derivative liability. As discussed further in Notes to Consolidated Financial Statements, Note 8 – Warrant Derivative Liabilities, the decrease in value reflects the impact of the increased likelihood of an event which would trigger certain early settlement provisions.

The increase in interest expense in the year ended December 31, 2013 from the year ended December 31, 2012 was due to higher average principal balance outstanding during the period ($79.8 million during 2013 and $24.6 million during 2012) and higher interest rate on the debt outstanding during the year ended December 31, 2013 (11 percent) than the year ended December 31, 2012 (8.25 percent through mid-October 2012 and 11 percent thereafter) offset by interest capitalized to oil and gas properties in the year ended December 31, 2013 of $8.3 million (year ended December 31, 2012: $3.0 million).

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During the year ended December 31, 2012, we incurred debt conversion expense of $2.9 million related to the issuance of 0.4 million common shares issued as an inducement for completing the exchange and legal and other professional fees ($0.7 million).

During the year ended December 31, 2012, we incurred a loss on extinguishment of debt of $5.4 million related to the early conversion of our 8.25 percent senior convertible notes. The loss on extinguishment of debt includes the difference between the carrying value of the 8.25 percent senior convertible notes and the amount received for the 11 percent senior unsecured notes ($5.0 million), expensing of deferred financing costs related to the 8.25 percent senior convertible notes ($0.1 million) and issuance of 30,000 shares of Harvest common stock issued in exchange for a waiver agreement ($0.3 million).

The $0.8 million loss on exchange rates for the year ended December 31, 2013 was primarily related to revaluation of the VAT receivable as compared to the nominal loss on exchange rates of $0.1 million for the year ended December 31, 2012.

The decrease in other non-operating expense in the year ended December 31, 2013 from the year ended December 31, 2012 was due to higher costs incurred in 2012 related to our strategic alternative process and evaluation.

We had income tax expense in the year ended December 31, 2013 of $73.1 million as compared to an income tax benefit of $(0.6) million in the year ended December 31, 2012. The income tax expense in 2013 included $89.9 million of accrued income tax related to previously unrecognized income tax on undistributed earnings for foreign subsidiaries (which were considered permanently invested in previous periods), $2.1 million of expense related to the sale of the interest in Harvest Holding offset by the benefit of $(8.8) million from the reversal of valuation allowances, the benefit from current year losses and a benefit of $(2.2) million from the favorable resolution of certain tax contingencies. The income tax benefit in the year ended December 31, 2012 is attributable to the benefit from net operating losses.

Earnings from Equity Affiliates

	Year Ended December 31,				Increase (Decrease)			% Increase (Decrease)			Increase (Decrease)
	2013		2012
	(dollars in thousands, except prices)
Revenues:
Crude oil	$	1,326,093	$	1,263,264	$	62,829			5	%
Natural gas		4,000		3,350		650			19	%
Total revenues	$	1,330,093	$	1,266,614	$	63,479			5	%
Price and Volume Variances:
Crude oil price variance (per Bbl)	$	91.22	$	95.91	$	(4.69	)		(5	)%	$	(61,773	)
Volume Variances:
Crude oil volumes (MBbls)		14,538		13,172		1,366			10	%		124,601
Natural gas volumes (MMcf)		2,593		2,171		422			19	%		651
Total variance											$	63,479

Revenues were higher in the year ended December 31, 2013 compared to the year ended December 31, 2012 due to increases in sales volumes resulting from running a six drilling rig program offset by lower world crude oil prices.

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Total expenses and other non-operating (income) expense, inclusive of all adjustments necessary to reconcile Net Income from Petrodelta to Earnings from Equity Affiliate:

	Year Ended December 31,					Increase (Decrease)
	2013			2012
	(in thousands)
Royalties	$	440,963		$	423,069	$	17,894
Operating expenses		151,661			121,023		30,638
Workovers		29,168			17,302		11,866
Depletion, depreciation and amortization		87,203			86,004		1,199
General and administrative		26,345			31,753		(5,408	)
Windfall profits tax		234,453			291,355		(56,902	)
Foreign currency transaction (gain)		(169,582	)		0		(169,582	)
Interest expense		21,728			7,017		14,711
Income tax expense (inclusive of U.S. GAAP adjustment)		298,475			124,142		174,333
Adjustment stated at our 40% equity interest related to amortization of excess basis		3,684			2,143		1,541

For the year ended December 31, 2013 compared to the year ended December 31, 2012, royalties, which is a function of revenue, increased due to the increase in revenues discussed above (net increase in revenue of $63.5 million at 30 percent royalty). The increase in operating expense is due to increased oil production as well as operating inefficiencies. Workover expense is higher for the year ended December 31, 2013 than the year ended December 31, 2012 due to running between one and two workovers rigs in 2013 versus one workover rig in 2012. Windfall Profits Tax, which is a function of volume and price received per barrel as well as pricing levels set for determining Windfall Profits Tax, decreased due to an increase in the pricing levels under the Windfall Profits Tax Law (See Operations – Petrodelta, S.A. above. The foreign currency transaction gain is due to the Bolivar devaluation in February 2013 from 4.30 Bolivars/U.S. Dollar to 6.30 Bolivars/U.S. Dollar and Petrodelta having more Bolivar denominated liabilities than Bolivar denominated assets. Petrodelta’s effective tax rate (inclusive of the adjustments to reconcile to reported earnings from unconsolidated equity affiliate) for the year ended December 31, 2013 was higher than the effective tax rate for the year ended December 31, 2012 primarily because the foreign currency transaction gain is not included in taxable income.

Net Income Attributable to Noncontrolling Interests

Net income attributable to noncontrolling interests is attributable to Vinccler’s 20 percent equity interest in Harvest Holding. Beginning December 16, 2013 it is also attributable to Petroandina’s 29 percent equity interest in Harvest Holding. Earnings for Harvest Holding are primarily attributable to Petrodelta, and the decrease in net income attributable to noncontrolling interests from $13.4 million for the year ended December 31, 2012 to $11.6 million for the year ended December 31, 2013 is primarily a result of lower earnings from Petrodelta during the period in which the noncontrolling interest increased from 20 percent to 49 percent.

Discontinued Operations

As a result of the decision to not request an extension of the First Phase or enter the Second Phase of the Exploration and Production Sharing Agreement (“EPSA”) A1 Ghubar / Qarn Alam license (“Block 64 EPSA”), Block 64 was relinquished effective May 23, 2013. The carrying value of Block 64 EPSA of $6.4 million was written off to impairment expense at December 31, 2012. Operations in Oman were terminated, and the field office was closed May 31, 2013. We have no continuing involvement in Oman. The loss from discontinued operations for Oman of $(0.7) million for the year ended December 31, 2013 included $0.5 million of general and administrative expenses. The loss from discontinued operations for Oman of $(12.7) million for the year ended December 31, 2012 included $6.4 million related impairment expense, $4.9 million related to dry hole costs and $1.1 million of general and administrative expenses.

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We have received notices of default from our partners for failing to comply with certain terms of the farmout agreements for Block VSM 14 and Block VSM 15 in Colombia, followed by notices of termination on November 27, 2013. As discussed further in “Item 3. Legal Proceedings”, our partners have filed for arbitration of claims related to these agreements. We have accrued $2.0 million as of December 31, 2013 related to obligations under the farmout agreements. After evaluating these circumstances, we determined that it was appropriate to fully impair the costs associated with these interests, and we recorded an impairment charge of $3.2 million during the year ended December 31, 2013. As we no longer have any interests in Colombia, we have reflected the results in discontinued operations.

On May 17, 2011, we closed the transaction to sell the Antelope Project. The sale had an effective date of March 1, 2011. We received cash proceeds of approximately $217.8 million which reflects increases to the purchase price for customary adjustments and deductions for transaction related costs. We do not have any continuing involvement with the Antelope Project. The related gain on the sale was reported in discontinued operations in the second quarter of 2011. During the year ended December 31, 2012, we incurred $0.1 million of expense related to settlement of royalty payments to the Mineral Management Services and write-offs of $5.2 million of accounts and note receivable and $3.6 million of accounts payable and carry obligation related to the settlement of all outstanding claims with a private third party on the Antelope Project.

Oman operations and the Antelope Project have been classified as discontinued operations. There were no revenues applicable to discontinued operations during the years ended December 31, 2013 and 2012. Income (loss) from discontinued operations was:

	December 31,
	2013			2012
	(in thousands)
Income (loss) from discontinued operations:
Oman operations	$	(674	)	$	(12,711	)
Colombia operations		(4,476	)		0
Antelope Project		0			(1,699	)
	$	(5,150	)	$	(14,410	)

Years Ended December 31, 2012 and 2011

We reported a net loss attributable to Harvest of $(12.2) million, or $(0.33) diluted earnings per share, for the year ended December 31, 2012, compared with net income attributable to Harvest of $56.0 million, or $1.64 diluted earnings per share, for the year ended December 31, 2011.

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Loss from Continuing Operations

Expenses and other non-operating (income) expense from continuing operations (in thousands) were:

	Year Ended December 31,						Increase (Decrease)
	2012			2011
Depreciation and amortization	$	391		$	439		$	(48	)
Exploration expense		8,838			11,950			(3,112	)
Impairment expense		2,900			3,335			(435	)
Dry hole costs		685			40,003			(39,318	)
General and administrative		26,012			21,428			4,584
Investment earnings and other		(348	)		(665	)		317
Unrealized (gain) loss on derivatives		600			(9,786	)		10,386
Interest expense		1,590			7,159			(5,569	)
Debt conversion expense		3,645			0			3,645
Loss on extinguishment of debt		5,425			13,132			(7,707	)
Foreign currency transaction losses		113			132			(19	)
Other non-operating expenses		2,905			1,376			1,529
Income tax expense (benefit)		(609	)		1,057			(1,666	)

Our accounting method for oil and gas properties is the successful efforts method. During the year ended December 31, 2012, we incurred $4.5 million of exploration costs for the processing and reprocessing of seismic data related to ongoing operations, $2.5 million related to other general business development activities, and $1.8 million related to lease maintenance. During the year ended December 31, 2011, we incurred $9.5 million of exploration costs for the acquisition, processing and reprocessing of seismic data related to ongoing operations, $0.3 million related to other general business development activities, and $2.2 million related to lease maintenance.

During the year ended December 31, 2012, we impaired $2.9 million related to the carrying value of WAB-21. During the year ended December 31, 2011, we impaired $3.3 million related to the carrying value of West Bay.

During the year ended December 31, 2012, we expensed to dry hole costs $0.7 million related to the drilling of the KD-1 well on the Budong. During the year ended December 31, 2011, we expensed to dry hole costs $14.0 million related to the drilling of the LG-1 on Budong PSC and $26.0 million related to the drilling of the KD-1 and KD-1ST on the Budong PSC. See Item 1. Business, Operations, Budong-Budong, Onshore Indonesia –Drilling and Development Activity.

The increase in general and administrative costs in the year ended December 31, 2012 from the year ended December 31, 2011, was primarily due to increases in employee related costs ($3.3 million, of which $2.2 million was non-cash related to equity compensation), public relations ($0.1 million) and audit fees ($2.0 million) offset by a decrease in general office expense and overhead ($0.4 million), contract services ($0.4 million) and travel costs ($0.2 million).

The decrease in investment earnings and other in the year ended December 31, 2012 from the year ended December 31, 2011 was due to the receipt during the year ended December 31, 2011 of payment for transition services provided on the Antelope Project after closing of the sale.

The decrease in unrealized gain (loss) on derivatives in the year ended December 31, 2012 from the year ended December 31, 2011 was due to the change in fair value for our warrant derivative liabilities: $3.18 per warrant at December 31, 2012 and $3.04 per warrant at December 31, 2011.

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The decrease in interest expense in the year ended December 31, 2012 from the year ended December 31, 2011 was due to the conversion of $31.5 million of our 8.25 percent senior convertible notes in the year ended December 31, 2012, offset by our $79.8 million senior unsecure note offering in October 2012, repayment in May 2011 of our $60 million term loan facility, and interest capitalized to oil and gas properties of $3.0 million.

As discussed under Years Ended December 31, 2013 and 2012 above, during the year ended December 31, 2012, we incurred debt conversion expense of $2.9 million related to the issuance of 0.4 million common shares issued as an inducement for completing the exchange and legal and other professional fees ($0.7 million), and we incurred a loss on extinguishment of debt of $5.4 million related to the early conversion of our 8.25 percent senior convertible notes. During the year ended December 31, 2011, we incurred a loss on extinguishment of debt related to early payment of our $60 million term loan facility. The loss on extinguishment of debt includes the write off of the discount on debt ($10.6 million), prepayment premium of 3.5 percent of the amount outstanding ($2.1 million), expensing of financing costs related to the term loan facility ($0.4 million), and the cost to redeem 4.4 million unvested warrants issued in connection with the term loan facility.

The foreign currency transaction losses for the year ended December 31, 2012 were consistent with the year ended December 31, 2011.

The increase in other non-operating expense in the year ended December 31, 2012 from the year ended December 31, 2011 was due to costs incurred related to our strategic alternative process and evaluation.

The change in income tax expense in the year ended December 31, 2012 from the year ended December 31, 2011 is due to a net operating loss incurred in 2012 while we had taxable income in 2011 as a result of the sale of interest in the Antelope Project.

Earnings from Equity Affiliates

	Year Ended December 31,				Increase (Decrease)			% Increase (Decrease)			Increase (Decrease)
	2012		2011
	(in dollars, except prices)
Revenues:
Crude oil	$	1,263,264	$	1,122,191	$	141,073			13	%
Natural gas		3,350		3,497		(147	)		(4	)%
Total revenues	$	1,266,614	$	1,125,688	$	140,926			13	%
Price and Volume Variances:
Crude oil price variance (per Bbl)	$	95.91	$	98.52	$	(2.62	)		(3	)%	$	(29,831	)
Volume Variances:
Crude oil volumes (MBbls)		13,172		11,390		1,782			16	%		170,903
Natural gas volumes (MMcf)		2,171		2,266		(95	)		(4	)%		(146	)
Total variance											$	140,926

For the year ended December 31, 2012, revenue from oil sales due to higher sales volumes ($170.9 million) offset by lower prices ($29.8 million).

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Total expenses and other non-operating (income) expense, inclusive of all adjustments necessary to reconcile Net Income from Petrodelta to Earnings from Equity Affiliate:

	Year Ended December 31,				Increase (Decrease)
	2012		2011
	(in thousands)
Royalties	$	423,069	$	374,135	$	48,934
Operating expenses		121,023		77,236		43,787
Workovers		17,302		28,508		(11,206	)
Depletion, depreciation and amortization		86,004		58,376		27,628
General and administrative		31,753		11,297		20,456
Windfall profits tax		291,355		237,632		53,723
Interest expense		7,017		10,699		(3,682	)
Income tax expense (inclusive of U.S. GAAP adjustment)		124,142		145,500		(21,358	)
Adjustment stated at our 40% equity interest related to amortization of excess basis		2,143		1,863		280

Royalties, which is a function of revenue, increased $48.9 million due to the increase in revenue (net increase in revenue of $141.2 million at 30 percent royalty). Windfall Profits Tax, which is a function of volume and price received per barrel, increased $53.7 million due to an increase in volumes (13.2 MBls in 2012 vs. 11.4 MBls in 2011) offset by lower price received per barrel ($95.91 per barrel in 2012 vs. $98.52 per barrel in 2011). The increase in operating expense in the year ended December 31, 2012 from the year ended December 31, 2011 was due to increased oil production and also includes $3.8 million of additional expense related to the labor law which was recorded in December 2012. The decrease in workover expense in the year ended December 31, 2012 from the year ended December 31, 2011 was due to fewer workovers being performed. Petrodelta’s effective tax rate (inclusive of the adjustments to reconcile to reported earnings from equity affiliate) for the year ended December 31, 2012 was not materially different with the effective tax rate for the year ended December 31, 2011.

Net Income Attributable to Noncontrolling Interests

The decrease in net income attributable to noncontrolling interests from $14.2 million for the year ended December 31, 2011 to $13.4 million for the year ended December 31, 2012 is primarily a result of the decrease in earnings from Petrodelta between the years.

Discontinued Operations

As discussed under Years Ended December 31, 2013 and 2012, Discontinued Operations above, the Oman operations and the Antelope Project have been classified as discontinued operations. Years Ended December 31, 2013 and 2012, Discontinued Operations above also discusses the losses from our Oman operations and Antelope Project for the year ended December 31, 2012. The loss from discontinued operations for Oman of $(11.4) million for the year ended December 31, 2011 included $9.7 million of dry hole costs and $1.0 million of general and administrative expenses. Income from discontinued operations for the Antelope Project for the year ended December 31, 2011 included $106.0 million gain on the sale of our Antelope Project, $3.8 million for employee severance and special accomplishment bonuses, and $5.7 million of U.S. income tax related to the sale of our Antelope Project. Severance costs for key employees include 58,000 stock appreciation rights (“SAR”) granted at an exercise price of $4.595 per SAR. These SARs are exercisable by the key employee for up to one year after termination.

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Revenues and income (loss) from discontinued operations were:

	December 31,
	2012			2011
	(in thousands)
Revenues applicable to discontinued operations:
Oman operations	$	0		$	0
Antelope Project		0			6,488
	$	0		$	6,488
Income (loss) from discontinued operations:
Oman operations	$	(12,711	)	$	(11,371	)
Antelope Project		(1,699	)		97,616
	$	(14,410	)	$	86,245

Risks, Uncertainties, Capital Resources and Liquidity

The following discussion on risks, uncertainties, capital resources and liquidity should be read in conjunction with our consolidated financial statements and related notes thereto.

Liquidity

In the Consolidated Financial Statements and other disclosures in our Annual Report on Form 10-K for 2012 (“2012 Form 10-K”), we discussed certain doubts about our ability to continue as a going concern. At the time we filed our 2012 Form 10-K, we expected that in 2013 we would not generate revenues, we would continue to generate losses from operations, and that our cash flows would not be sufficient to cover our operating expenses. While we believed that we would be able to raise additional capital through issuances of debt and/or equity or through sales of assets, our circumstances at such time raised substantial doubt about our ability to continue to operate as a going concern, and this was disclosed in the notes to the consolidated financial statements and in other disclosures in the 2012 Form 10-K.

As discussed above under Share Purchase Agreement, on December 16, 2013, Harvest and HNR Energia entered into the Share Purchase Agreement with Petroandina and Pluspetrol, its parent, to sell all of our 80 percent equity interest in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement, when we sold a 29 percent equity interest in Harvest Holding for $125 million. Proceeds from the December 2013 sale of the 29 percent equity interest in Harvest Holding are expected to be adequate to meet our short-term liquidity requirements. We used a portion of the proceeds to redeem all of our 11% Senior Notes due 2014. The notes were redeemed on January 11, 2014, for $80.0 million, including principal and accrued and unpaid interest. The remaining $45.0 million of the proceeds from the sale have been or will be used to pay costs associated with the sale of our Venezuelan interests, to pay severance costs, to make capital expenditures, to pay taxes related to the sale and for general operating expenses. Those remaining proceeds will also be used to repurchase certain outstanding warrants if our stockholders approve the sale of our remaining Venezuelan interests, and if a “Fundamental Change” is consummated under the terms of those warrants.

We expect that during 2014, our capital needs will be met either from the completion of the sale of our remaining Venezuelan interests, the sale of other non-Venezuelan assets or borrowings available under the Share Purchase Agreement during the period until the second closing. The timing of the second closing, however, is beyond the control of the Company. In addition, depending on the timing of these events, we anticipate using a portion of the proceeds from the second closing to pay for expenses and other costs related to the transaction, which we estimate will be approximately $4 million; to pay taxes related to the transaction, which we estimate will be approximately $51.1 million; and if we do not sell our non-Venezuelan assets before the second closing,

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then we estimate that we will need to retain approximately $30 million to fund projected general operating expenses and capital expenditures from April 1, 2014 through December 31, 2014 (to the extent that those general operating expenses are not already reserved from any possible sale of our non-Venezuelan assets).

In addition, we may be able to meet future liquidity needs through the issuance of additional equity securities and/or short or long-term debt financing, although there can be no assurance that such financing will be available to us or on terms that are acceptable to us, farm-downs or possible sales of assets.

The oil and gas industry is a highly capital intensive and cyclical business with unique operating and financial risks. In Item 1A. Risk Factors, we discuss a number of variables and risks related to our exploration projects and our minority equity investment in Petrodelta that could significantly utilize our cash balances, affect our capital resources and liquidity.

Accumulated Undistributed Earnings of Foreign Subsidiaries

As of December 31, 2013, the book-tax outside basis difference in our foreign subsidiary resulting from unremitted earnings was approximately $334.8 million. Prior to 2013, no U.S. taxes had been recorded on these earnings as it was our practice and intention to reinvest the earnings of our non-U.S. subsidiaries in those operations.

Under ASC 740-30-25-17, no deferred tax liability must be recorded if sufficient evidence shows that the subsidiary has invested or will invest the undistributed earnings or that the earnings will be remitted in a tax-free manner. Management must consider numerous factors in determining timing and amounts of possible future distribution of these earnings to the parent company and whether a U.S. deferred tax liability should be recorded for these earnings. These factors include the future operating and capital requirements of both the parent company and the subsidiaries, remittance restrictions imposed by foreign governments or financial agreements and tax consequences of the remittance, including possible application of U.S. foreign tax credits and limitations on foreign tax credits that may be imposed by the Internal Revenue Code and regulations.

During the fourth quarter of 2013, management evaluated numerous factors related to the timing and amounts of possible future distribution of these earnings to the parent company, with consideration of the pending sale of the remaining equity interest in Harvest Holding as well as possible sales of other non-U.S. assets. While we will continue to invest the undistributed earnings to the extent possible and operate the Company’s business in the normal course, management is also considering distributions to the Company’s shareholders which could include the distribution of proceeds from the sales of assets by the Company’s foreign subsidiaries to the U.S. parent company resulting in U.S. taxable income. Because management is pursuing various alternatives, a determination was made that it was appropriate to record a deferred tax liability associated with the unremitted earnings of our foreign subsidiaries of $89.9 million in the fourth quarter of 2013. This liability includes $51.1 million which could become payable currently upon the sale of the remaining interest in Harvest Holding and is therefore reflected as a current deferred tax liability.

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Working Capital and Cash Flows

The net funds raised and/or used in each of the operating, investing and financing activities are summarized in the following table and discussed in further detail below:

	Year Ended December 31,
	(in thousands, except ratios)
	2013			2012			2011
Net cash used in operating activities	$	(37,077	)	$	(26,405	)	$	(55,243	)
Net cash provided by (used in) investing activities		80,460			(23,789	)		112,216
Net cash provided by (used in) financing activities		4,887			63,875			(56,730	)
Net increase in cash	$	48,270		$	13,681		$	243
Working capital	$	(31,667	)	$	40,537		$	62,618
Current ratio		0.8			2.0			3.1
Total cash, including restricted cash	$	121,045		$	73,627		$	60,146
Total debt*	$	83,589		$	74,839		$	31,535

* 2013 also includes notes payable to noncontrolling interest owner of $6.1 million.

Working Capital

The decrease in working capital of $72.2 million between December 31, 2012 and December 31, 2013 was primarily due to increases in the current portion of long-term debt of $77.5 million and current deferred tax liability of $43.2 million, cash used to fund the loss from operations and interest payments as well as cash payments for capital expenditures offset by net proceeds of $124.0 million from the first closing sale to Petroandina. The current deferred tax liability of $43.2 million and the long-term deferred tax liability of $29.8 million are primarily related to the accrued income tax on undistributed earnings of foreign subsidiaries.

The decrease in working capital of $22.1 million at December 31, 2012 from December 31, 2011 was primarily due to decreases in receivables, increases in cash payments for capital expenditures and accrued expenses and decreases in accounts payable.

Cash Flow from Operating Activities

During the year ended December 31, 2013, net cash used in operating activities was approximately $37.1 million ($26.4 million during the year ended December 31, 2012). The $10.7 million increase in use of cash was primarily due to an increase in exploration expenses, general and administrative costs and interest expense.

Cash Flow from Investing Activities

Our cash capital expenditures for property and equipment are summarized in the following table:

	December 31,
	2013		2012
	(in thousands)
Budong PSC	$	175	$	5,819
Dussafu PSC		42,536		11,660
Other		0		46
Total additions of property and equipment – continuing operations		42,711		17,525
Colombia-discontinued operations (1)		1,195		0
Block 64 EPSA-discontinued operations (1)		0		6,050
Total additions of property and equipment	$	43,906	$	23,575

⁽¹⁾  See Item 15. Exhibits and Financial Statement Schedules, Notes to Consolidated Financial Statements, Notes to Consolidated Financial Statements, Note 5 – Dispositions, Discontinued Operations.

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In addition to cash capital expenditures, during the year ended December 31, 2013, we:

• Received $124.0 million in net proceeds from the first closing sale to Petroandina; and

• Advanced $0.5 million to Petrodelta for continuing operations costs; and

• We had $1.0 million in restricted cash returned to us and deposited with a U.S. bank $0.1 million for a customs bond related to Dussafu PSC.

In addition to cash capital expenditures, during the year ended December 31, 2012, we:

• Advanced $0.5 million to Petrodelta for continuing operations costs, and Petrodelta repaid $0.1 million; and

• Deposited with a U.S. bank $1.0 million as collateral for a Standby Letter of Credit issued in support of a performance bond for a joint study and had $1.2 million of restricted cash released to us.

Petrodelta’s capital commitments will be determined by its business plan. Petrodelta’s capital commitments are expected to be funded by internally generated cash flow. Our budgeted capital expenditures of $8.7 million for 2014, of which $2.2 million is non-discretionary, for U.S., Gabon and Indonesia operations will be funded through our existing cash balances, accessing equity and debt markets, and cost reductions. In addition, we could delay the discretionary portion of our capital spending to future periods or sell assets as necessary to maintain the liquidity required to run our operations, as warranted.

Cash Flow from Financing Activities

During the year ended December 31, 2013, we:

• Sold 2,494,800 shares of our Common Stock in private placements for $9.3 million;

• We made a payment of $4.3 million on our note payable to O&G Technology Consultants, a noncontrolling interest owner; and

• Incurred $0.2 million in legal fees associated with financings.

During the year ended December 31, 2012, we:

• Received cash proceeds of $66.5 million from an offering of $79.8 million in aggregate principal amount of our 11.0 percent senior unsecured notes (see Item 15. Exhibits and Financial Statement Schedules, Notes to Consolidated Financial Statements, Note 11 – Debt); and

• Incurred $3.3 million in legal fees associated with financings.

Contractual Obligations

At December 31, 2013, we had the following lease commitments for office space in Houston, Texas, regional/technical offices in Singapore and field offices in Port Gentil, Gabon and Jakarta, Indonesia that support field operations in those areas.

Location	Date Lease Signed	Term		Annual Expense
Houston, Texas	April 2004		10.0 years	$	306,000
Houston, Texas	December 2008		5.6 years		147,000
Caracas, Venezuela	December 2013		1.0 years		92,750
Port Gentil, Gabon	December 2012		2.0 years		61,750
Singapore	October 2012		2.0 years		87,600
Jakarta, Indonesia	April 2012		2.0 years		174,900

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At December 31, 2013, we had the following contractual obligation (in thousands):

	Payments Due by Period
	Total		Less than 1 Year		1-2 Years		3-4 Years		After 4 Years
Debt:
11.0% Senior Unsecured Notes Due 2014	$	79,750	$	79,750	$	0	$	0	$	0
Note payable to noncontrolling interest owner		6,109		0		6,109		0		0
Total debt		85,859		79,750		6,109		0		0
Other obligations:
Interest payments		244		244		0		0		0
Oil and gas activities		6,204		6,204		0		0		0
Office leases		583		521		62		0		0
Total other obligations		7,031		6,969		62		0		0
Total contractual obligations	$	92,890	$	86,719	$	6,171	$	0	$	0

“Oil and gas activities” in the table above includes various contractual commitments pertaining to exploration, development and production activities. The four-year extension of the initial exploration phase on the Budong PSC includes an exploration well, which if not drilled by January 2016, results in the termination of the Budong PSC. Also, if this exploration well is not drilled before October 2014 (within 18 months of the date of approval from the Government of Indonesia of this transaction), our partner has the right to give us notice that the consideration for the additional 7.1 percent participating interest must be paid in cash for $3.2 million. We have accrued $2.0 million as of December 31, 2013 for claims made under arbitration proceedings related to the farmout agreements for our Colombian project. See Item 15. Exhibits and Financial Statement Schedules, Notes to Consolidated Financial Statements, Note 9 – Indonesia.

Senior Unsecured Notes

On October 11, 2012, we closed an offering of $79.8 million in aggregate principal amount of our 11.0 percent senior unsecured notes. We used a portion of the proceeds from the sale of the 29 percent interest in Harvest Holding to redeem all of our 11% Senior Notes due 2014. The notes were redeemed on January 11, 2014, for $80.0 million, including principal and accrued and unpaid interest. As a result of the redemption, we will record a loss on extinguishment of debt of approximately $3.6 million during the three months ended March 31, 2014. This loss primarily includes the write off of the discount on debt ($2.3 million) and the expensing of financing costs related to the term loan facility ($1.3 million). See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Risks, Uncertainties, Capital Resources and Liquidity.

Effects of Changing Prices, Foreign Exchange Rates and Inflation

Our results of operations and cash flow are affected by changing oil prices. Fluctuations in oil prices may affect our total planned development activities and capital expenditure program.

Our net foreign exchange losses attributable to our international operations were minimal for the years ended December 31, 2013, 2012 and 2011. There are many factors affecting foreign exchange rates and resulting exchange gains and losses, most of which are beyond our control. It is not possible for us to predict the extent to which we may be affected by future changes in exchange rates and exchange controls.

Venezuela imposed currency exchange restrictions in February 2003, and adjusted the official exchange rate in February 2004, March 2005, January 2010, January 2011, February 2013 and December 2013. As a result of

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the December 2013 devaluation, Harvest Vinccler recorded a $0.1 million gain on revaluation of its assets and liabilities, and Petrodelta recorded a gain of approximately $169.6 million gain on revaluation of its assets and liabilities.

Harvest Vinccler’s and Petrodelta’s functional and reporting currency is the U.S. Dollar. They do not have currency exchange risk other than the official prevailing exchange rate that applies to their operating costs denominated in Venezuela Bolivars (“Bolivars”) (11.3 Bolivars per U.S. Dollar). However, during the year ended December 31, 2013, Harvest Vinccler exchanged approximately $1.6 million through the Central Bank and received an average exchange rate of 6.9 Bolivars per U.S. Dollar. See Operations – Venezuela for a more complete discussion of the exchange agreements and their effects on our Venezuelan operations.

Within the United States and other countries in which we conduct business, inflation has had a minimal effect on us, but it is an important factor with respect to certain aspects of the results of operations in Venezuela. The inflation rate in Venezuela was 56.2 percent for the year ended December 31, 2013 (year ended December 31, 2012: 14.06 percent).

Critical Accounting Policies

Reporting and Functional Currency

The United States Dollar (“U.S. Dollar”) is the reporting and functional currency for all of our controlled subsidiaries and Petrodelta. Amounts denominated in non-U.S. Dollar currencies are re-measured into U.S. Dollars, and all currency gains or losses are recorded in the consolidated statements of operations and comprehensive income (loss). There are many factors that affect foreign exchange rates and the resulting exchange gains and losses, many of which are beyond our influence.

Investment in Equity Affiliates

We evaluate our investments in unconsolidated companies under ASC 323, “Investments – Equity Method and Joint Ventures.” Investments in which we have significant influence are accounted for under the equity method of accounting. Under the equity method, Investment in Equity Affiliates is increased by additional investments and earnings and decreased by dividends and losses. We review our Investment in Equity Affiliates for impairment whenever events and circumstances indicate a loss in investment value is other than a temporary decline.

There are many factors to consider when evaluating an equity investment for possible impairment. Currency devaluations, inflationary economies, and cash flow analysis are some of the factors we consider in our evaluation for possible impairment.

Capitalized Interest

We capitalize interest costs for qualifying oil and gas properties. The capitalization period begins when expenditures are incurred on qualified properties, activities begin which are necessary to prepare the property for production and interest costs have been incurred. The capitalization period continues as long as these events occur. The average additions for the period are used in the interest capitalization calculation.

Property and Equipment

We follow the successful efforts method of accounting for our oil and gas properties. Under this method, oil and natural gas lease acquisition costs are capitalized when incurred. Unproved properties are assessed quarterly on a property-by-property basis, and any impairment in value is recognized. If the unproved properties are determined to be productive, the appropriate related costs are transferred to proved oil and gas properties. Lease rentals are expensed as incurred.

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Oil and natural gas exploration costs, other than the costs of drilling exploratory wells, are charged to expense as incurred. The costs of drilling exploratory wells are capitalized pending determination of whether the wells have discovered proved reserves. Exploratory drilling costs are capitalized when drilling is completed if it is determined that there is economic producibility supported by either actual production, conclusive formation test or by certain technical data. If proved reserves are not discovered, such drilling costs are expensed. Costs to develop proved reserves, including the costs of all development wells and related equipment used in production of crude oil and natural gas, are capitalized.

Depletion, depreciation, and amortization (“DD&A”) of the cost of proved oil and natural gas properties are calculated using the unit of production method. The reserve base used to calculate DD&A for leasehold acquisition costs and the cost to acquire proved properties is proved reserves. With respect to lease and well equipment costs, which include development costs and successful exploration drilling costs, the reserve base is proved developed reserves. Estimated future dismantlement, restoration and abandonment costs, net of salvage values, are taken into account. Certain other assets are depreciated on a straight-line basis.

Assets are grouped in accordance with ASC 932. The basis for grouping is reasonable aggregation of properties with a common geological structural feature or stratigraphic condition, such as a reservoir or field.

Amortization rates are updated to reflect: 1) the addition of capital costs, 2) reserve revisions (upwards or downwards) and additions, 3) property acquisitions and/or property dispositions and 4) impairments.

We account for impairments of proved properties under the provisions of ASC 360, “Property, Plant, and Equipment”. When circumstances indicate that an asset may be impaired, we compare expected undiscounted future cash flows at a producing field level to the amortized capitalized cost of the asset. If the future undiscounted cash flows, based on our estimate of future crude oil and natural gas prices, operating costs, anticipated production from proved reserves and other relevant data, are lower than the amortized capitalized cost, the capitalized cost is reduced to fair value. Fair value is calculated by discounting the future cash flows at an appropriate risk-adjusted discount rate.

Reserves

In December 2009, we adopted the SEC’s Modernization of Oil and Gas Reporting and ASC 932. ASC 932 requires the unweighted average, first-day-of-the-month price during the 12-month period preceding the end of the year be used when estimating reserve quantities and permits the use of reliable technologies to determine proved reserves, if those technologies have been demonstrated to result in reliable conclusions about reserves volumes.

Proved 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 from known reservoirs and under existing economic conditions, operating methods, government regulations, etc. Prices include consideration of changes in existing prices provided only by contractual arrangements and do not include adjustments based upon expected future conditions. 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.

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The estimate of reserves is made using available geological and reservoir data as well as production performance data. These estimates are prepared by an independent third party petroleum engineering consulting firm and revised, either upward or downward, as warranted by additional data. Revisions are necessary due to changes in, among other things, reservoir performance, prices, economic conditions and governmental restrictions, as well as changes in the expected recovery associated with infill drilling. Decreases in prices, for example, may cause a reduction in some proved reserves due to reaching economic limits earlier. A material adverse change in the estimated volumes of proved reserves could have a negative impact on DD&A expense and could result in the recognition of an impairment.

Income Taxes

Deferred income taxes reflect the net tax effects, calculated at currently enacted rates, of (a) future deductible/taxable amounts attributable to events that have been recognized on a cumulative basis in the financial statements or income tax returns, and (b) operating loss and tax credit carry forwards. A valuation allowance for deferred tax assets is recorded when it is more likely than not that the benefit from the deferred tax asset will not be realized.

Where we are able to determine that undistributed earnings of our foreign subsidiaries are permanently reinvested as part of our ongoing business, we do not provide deferred income taxes for possible future remittances of such earnings.

New Accounting Pronouncements

In January 2013, FASB issued ASU No. 2013-01, which is included in ASC 210, “Balance Sheet”, “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities” (“ASU No. 2013-01”). This update clarifies that the scope of ASU 2011-11: “Disclosures about Offsetting Assets and Liabilities” applies only to derivatives accounted for under ASC 815 “Derivatives and Hedging”, included bifurcated embedded derivatives, repurchase agreements and reverse repurchase agreements, and securities lending transactions that are either offset in accordance with ASC 210-20-45 or ASC 815-10-45 or subject to an enforceable master netting arrangement or similar agreement. ASU No. 2013-01 is effective for fiscal years and interim periods within those years, beginning on or after January 1, 2013. Entities should provide the required disclosures retrospectively for all comparative periods presented. The adoption of this guidance impacted presentation disclosures only and did not have an impact on our consolidated financial position, results of operation or cash flows.

In February 2013, FASB issued ASU No. 2013-04, which is included in ASC 405, “Liabilities”, “Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation is Fixed at the Reporting Date”. This update provides guidance for the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of the obligation with the scope of this guidance is fixed at the reporting date, except for obligations addressed within existing guidance in USGAAP. Examples of obligations within the scope to ASU No. 2013-04 include debt arrangements, other contractual obligations, and settled litigation and judicial rulings. ASU No. 2013-04 is effective for fiscal years and interim periods within those years beginning after December 15, 2013. Entities should provide the required disclosures retrospectively for all comparative periods presented. We are currently evaluating the impact of this guidance, but we expect that the adoption of this guidance will impact presentation disclosures only and will not have an impact on our consolidated financial position, results of operation or cash flows.

In July 2013, FASB issued ASU No. 2013-11 which is included in ASC 740 “Income Taxes”, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” This update provides guidance regarding the presentation of unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward are not available at the reporting date to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose. In such instances, the unrecognized tax benefit should be presented in the

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financial statements as a liability and should not be combined with deferred tax assets. The amendment should be applied prospectively to all unrecognized tax benefits that exist at the effective date; however, retrospective application is permitted. The amendment is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. We are currently evaluating the impact of this guidance, but we expect that the adoption of this guidance will impact presentation disclosures only and will not have an impact on our consolidated financial position, results of operation or cash flows.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to market risk from adverse changes in oil and natural gas prices and foreign exchange risk, as discussed below.

Oil Prices

Oil and natural gas prices historically have been volatile, and this volatility is expected to continue. Prevailing prices for such commodities are subject to wide fluctuation in response to relatively minor changes in supply and demand and a variety of additional factors beyond our control. Being primarily a crude oil producer, we are more significantly impacted by changes in crude oil prices than by changes in natural gas prices. As an independent oil producer, our revenue, other income and profitability, reserve values, access to capital and future rate of growth are substantially dependent upon the prevailing prices of crude oil and natural gas.

We and our equity affiliates currently do not have any oil production that is hedged. While hedging limits the downside risk of adverse price movements, it may also limit future revenues from favorable price movements.

Interest Rates

Total debt at December 31, 2013 consisted of $77.5 million of fixed-rate senior unsecured notes maturing in 2014 and a $6.1 million note payable to a noncontrolling interest owner maturing in 2016. We used a portion of the proceeds from the sale of the 29 percent interest in Harvest Holding to redeem all of our 11% Senior Notes due 2014. The notes were redeemed on January 11, 2014, for $80.0 million, including principal and accrued and unpaid interest. See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Risks, Uncertainties, Capital Resources and Liquidity. Interest on the note payable to the noncontrolling interest owner accrues at US dollar based LIBOR plus 0.5%. It is management’s intention to fully settle this note in 2014.

Foreign Exchange

The Bolivar is not readily convertible into the U.S. Dollar. We have not utilized currency hedging programs to mitigate any risks associated with operations in Venezuela, and, therefore, our financial results are subject to favorable or unfavorable fluctuations in exchange rates and inflation in that country. Venezuela has imposed currency exchange controls. See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, Effects of Changing Prices, Foreign Exchange Rates and Inflation above.

Item 8. Financial Statements and Supplementary Data

The information required by this item is included herein begins on page S-1.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

On June 19, 2013, we, at the direction and with the unanimous approval of the Audit Committee (the “Audit Committee”) of the Company’s Board of Directors (the “Board”), dismissed PricewaterhouseCoopers LLP (“PwC”) as its independent registered public accounting firm and engaged UHY LLP (“UHY”) to become its new independent registered public accounting firm.

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PwC’s reports on the Company’s consolidated financial statements for the fiscal years ended December 31, 2012 and 2011 did not contain any adverse opinion or a disclaimer of opinion, nor were those reports qualified or modified as to uncertainty, audit scope or accounting principles, except that PwC’s audit opinion on the Company’s financial statements as of and for the year ended December 31, 2012 (a) includes an explanatory paragraph expressing substantial doubt regarding the Company’s ability to continue as a going concern and (b) expresses an opinion that the Company did not maintain, in all material respects, effective internal control over financial reporting as of December 31, 2012, because of material weaknesses in internal control over financial reporting as described below.

During the Company’s two most recent fiscal years ended December 31, 2011 and 2012, and the subsequent interim period through June 19, 2013, there were no disagreements with PwC on any matters of accounting principles and practices, financial statement disclosure, or auditing scope or procedure that, if not resolved to the satisfaction of PwC, would have caused it to make reference to the disagreement in connection with its reports on the Company’s financial statements.

Except for the six material weaknesses in the Company’s internal control over financial reporting as described by the Company in Item 9A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2012, as filed with the Securities and Exchange Commission (the “Commission”) on May 2, 2013 (the “2012 Form 10-K”), there were no “reportable events,” as defined in Item 304(a)(1)(v) of Regulation S-K that occurred during the Company’s two most recent fiscal years or during the subsequent interim period through June 19, 2013. The material weaknesses in internal control over financial reporting identified in the 2012 Form 10-K related to (1) an insufficient complement of accounting and financial reporting resources; (2) accounting for certain transactions for oil and gas unproved properties; (3) accounting for income taxes; (4) appropriate segregation of duties related to certain system access rights and the recording and review of journal entries; (5) preparation and review of certain classification and disclosure matters impacting the financial statements and related notes; and (6) significant and complex debt and equity transactions. Because of these weaknesses, the Company’s management concluded, as reported in the 2012 Form 10-K, that the Company did not maintain effective internal control over financial reporting as of December 31, 2012. PwC, in its attestation report in the 2012 Form 10-K also reported that, in its opinion, the Company did not maintain in all material respects, effective internal control over financial reporting as of December 31, 2012. The Audit Committee discussed these matters with PwC, and the Company authorized PwC to respond fully to any inquiries by UHY.

The Company provided PwC with a copy of its June 19, 2013 Current Report on Form 8-K filed on June 21, 2013 in which the change in accountants was reported and requested that PwC furnish the Company with a letter addressed to the Commission stating whether PwC agrees with the statements made by the Company herein. A copy of PwC’s response letter was included as Exhibit 16.1 to the June 19, 2013 Form 8-K.

During the fiscal years ended December 31, 2011 and 2012 and the subsequent interim period through the date of UHY’s engagement, neither the Company nor anyone acting on its behalf consulted UHY with respect to either (i) the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Company’s consolidated financial statements, and no written report or oral advice was provided by UHY to the Company that UHY concluded was an important factor considered by the Company in reaching a decision as to the accounting, auditing, or financial reporting issue; or (ii) any matter that was the subject of either a disagreement (as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions to such item) or a reportable event (as described in Item 304(a)(1)(v) of Regulation S-K).

Item 9A. Controls and Procedures

Evaluation of Disclosure Controls and Procedures. We have established disclosure controls and procedures that are designed to ensure the information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods

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specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Management of the Company, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of the Company’s disclosure controls and procedures. Based on their evaluation as of December 31, 2013, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) were effective.

Management’s Report on Internal Control Over Financial Reporting. Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f) and 15d-15(f). Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the 1992 Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of The Treadway Commission. Based on our evaluation under the 1992 Internal Control Integrated Framework, our management concluded that our internal control over financial reporting was effective as of December 31, 2013. The effectiveness of our internal control over financial reporting as of December 31, 2013, has been audited by UHY LLP, an independent registered public accounting firm, as stated in their report which appears herein.

Remediation of Material Weaknesses. As discussed in our 2012 Form 10-K, our management concluded that our internal control over financial reporting was not effective as of December 31, 2012 as a result of material weaknesses related to an insufficient complement of accounting and financial reporting resources, accounting for certain transactions for oil and gas properties, accounting for income taxes and the financial reporting process. Management identified the following measures to strengthen our internal control over financial reporting and to address these material weaknesses. We began implementing certain of these measures in the second quarter of 2013 and continued to develop remediation plans and implemented additional measures throughout the remainder of 2013, including:

• We retained and recruited qualified finance professionals necessary to properly maintain and control our financial reporting. We contracted a new chief accounting officer in July 2013;

• We continued to assess adequacy and expertise of the finance, tax and accounting staff;

• We enhanced procedures to help ensure that the proper accounting for all complex, non-routine transactions is researched, detailed in memoranda and reviewed by senior management on a timely basis prior to recording;

• We ensured that our finance resources are familiarized with policies and procedures to effectively monitor compliance; and

• We improved the periodic financial close process through the use of a detailed financial close plan and enhanced and more timely reviewed manual journal entries, account reconciliations, estimates and judgments and consolidation schedules.

The Company believes that the steps described above have enhanced the overall effectiveness of our internal control over financial reporting and remediated the previously identified material weaknesses.

Changes in Internal Control over Financial Reporting. Except for the remediation of the previously identified material weaknesses discussed above, there have been no other changes in internal control over financial reporting during the quarter ended December 31, 2013 that have materially affected or are reasonably likely to materially affect that Company’s internal control over financial reporting.

Item 9B. Other Information

None.

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PART III

Item 10. Directors, Executive Officers and Corporate Governance

Please refer to the information under the caption “Directors, Executive Officers and Corporate Governance” in an amendment to this Annual Report on Form 10-K to be filed with the SEC on or before April 30, 2014.

Item 11. Executive Compensation

Please refer to the information under the caption “Executive Compensation” in an amendment to this Annual Report on Form 10-K to be filed with the SEC on or before April 30, 2014.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Please refer to the information under the caption “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters” in an amendment to this Annual Report on Form 10-K to be filed with the SEC on or before April 30, 2014.

Item 13. Certain Relationships and Related Transactions, and Director Independence

Please refer to the information under the caption “Certain Relationships and Related Transactions, and Director Independence” in an amendment to this Annual Report on Form 10-K to be filed with the SEC on or before April 30, 2014.

Item 14. Principal Accountant Fees and Services

Please refer to the information under the caption “Principal Accountant Fees and Services” in an amendment to this Annual Report on Form 10-K to be filed with the SEC on or before April 30, 2014.

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PART IV

Item 15. Exhibits and Financial Statement Schedules

(a)	1.	Index to Financial Statements:	Page
		Reports of Independent Registered Public Accounting Firms	S-1
		Consolidated Balance Sheets at December 31, 2013 and 2012	S-4
		Consolidated Statements of Operations for the Years Ended December 31, 2013, 2012 and 2011	S-5
		Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 2013, 2012 and 2011	S-6
		Consolidated Statements of Cash Flows for the Years Ended December 31, 2013, 2012 and 2011	S-7
		Notes to Consolidated Financial Statements	S-9
	2.	Consolidated Financial Statement Schedules and Other:

All schedules are omitted because they are not applicable or the required information is shown in the financial statements or the notes thereto.

Separate financial statements of Petrodelta, S.A. required pursuant to Rule 3-09 of Regulation S-X are filed as Exhibit 99.1.

(b) 3. Exhibits:

3.1	Amended and Restated Certificate of Incorporation. (Incorporated by reference to Exhibit 3.1 to our Form 10-Q filed on November 9, 2010, File No. 1-10762.)
3.2	Restated Bylaws as of May 17, 2007. (Incorporated by reference to Exhibit 3.1 to our Form 8-K filed on May 23, 2007, File No. 1-10762.)
4.1	Form of Common Stock Certificate. (Incorporated by reference to Exhibit 4.1 to our Form 10-K filed on March 17, 2008, File No. 1-10762.)
4.2	Certificate of Designation, Rights and Preferences of the Series B Preferred Stock of Benton Oil and Gas Company, filed May 12, 1995. (Incorporated by reference to Exhibit 4.2 to our Form 10- Q filed on November 9, 2010, File No. 1-10762.)
4.3	Third Amended and Restated Rights Agreement, dated as of August 23, 2007, between Harvest Natural Resources, Inc. and Wells Fargo Bank, N.A. (Incorporated by reference to Exhibit 99.3 to our Form 8-A12G filed on October 23, 2007, File No. 1-10762.)
4.4	Amendment to Third Amended and Restated Rights Agreement, dated as of October 28, 2010, between Harvest Natural Resources, Inc. and Wells Fargo Bank, N.A. (Incorporated by reference to Exhibit 4.1 to our Form 8-K filed on October 29, 2010, File No. 1-10762.)
4.5	Warrant Purchase Agreement, dated as of October 28, 2010, between Harvest Natural Resources, Inc. and MSD Energy Investments Private II, LLC. (Incorporated by reference to Exhibit 4.2 to our Form 8-K filed on October 29, 2010, File No. 1-10762.)
4.9	Common Stock Purchase Warrant No. W-1, dated as of October 28, 2010, between Harvest Natural Resources, Inc. and MSD Energy Investments Private II, LLC. (Incorporated by reference to Exhibit 4.3 to our Form 8-K filed on October 29, 2010, File No. 1-10762.)
4.10	Common Stock Purchase Warrant No. W-2, dated as of October 28, 2010, between Harvest Natural Resources, Inc. and MSD Energy Investments Private II, LLC. (Incorporated by reference to Exhibit 4.4 to our Form 8-K filed on October 29, 2010, File No. 1-10762.)

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4.11	Indenture, dated as of October 11, 2012, between the Company and U.S. Bank National Association, as Trustee. (Incorporated by reference to Exhibit 4.1 to our Form 8-K filed on October 15, 2012, File No. 1-10762).
4.12	Form of Note. (Included as Exhibit 1 to the Indenture filed as Exhibit 4.1 to our Form 8-K filed on October 15, 2012, File No. 1-10762).
4.13	Warrant Agreement, dated as of October 11, 2012, between the Company and U.S. Bank National Association, as Warrant Agent. (Incorporated by reference to Exhibit 4.3 to our Form 8-K filed on October 15, 2012, File No. 1-10762).
4.14	Form of Warrant. (Included as Exhibit A to the Warrant Agreement filed as Exhibit 4.3 to our Form 8-K filed on October 15, 2012, File No. 1-10762).
4.15	Second Amendment to Third Amended and Restated Rights Agreement, dated as of February 1, 2013, between Harvest Natural Resources, Inc. and Wells Fargo Bank, N.A., as Rights Agent. (Incorporated by reference to Exhibit 4.1 to our Form 8-K filed on February 4, 2013, File No. 1- 10762.)
10.1†	2001 Long Term Stock Incentive Plan. (Incorporated by reference to Exhibit 4.1 to our Registration Statement on Form S-8 filed on April 9, 2002 (Registration Statement No. 333- 85900).)
10.2†	Harvest Natural Resources 2004 Long Term Incentive Plan. (Incorporated by reference to Exhibit 4.5 to our Registration Statement on Form S-8 filed on May 25, 2004 (Registration Statement No. 333-115841).)
10.3†	Form of Indemnification Agreement between Harvest Natural Resources, Inc. and each Director and Executive Officer of the Company. (Incorporated by reference to Exhibit 10.19 to our Form 10-K filed on February 23, 2005, File No. 1-10762.)
10.4†	Form of 2004 Long Term Stock Incentive Plan Stock Option Agreement. (Incorporated by reference to Exhibit 10.20 to our Form 10-K filed on February 23, 2005, File No. 1-10762.)
10.5†	Form of 2004 Long Term Stock Incentive Plan Director Restricted Stock Agreement. (Incorporated by reference to Exhibit 10.21 to our Form 10-K filed on February 23, 2005, File No. 1-10762.)
10.6†	Form of 2004 Long Term Stock Incentive Plan Employee Restricted Stock Agreement. (Incorporated by reference to Exhibit 10.22 to our Form 10-K filed on February 23, 2005, File No. 1-10762.)
10.7†	Stock Option Agreement dated September 15, 2005, between Harvest Natural Resources, Inc. and James A. Edmiston. (Incorporated by reference to Exhibit 10.24 to our Form 10-K filed on February 27, 2006, File No. 1-10762.)
10.8†	Stock Option Agreement dated September 15, 2005, between Harvest Natural Resources, Inc. and James A. Edmiston. (Incorporated by reference to Exhibit 10.25 to our Form 10-K filed on February 27, 2006, File No. 1-10762.)
10.9†	Stock Option Agreement dated September 26, 2005, between Harvest Natural Resources, Inc. and Byron A. Dunn. (Incorporated by reference to Exhibit 10.26 to our Form 10-K filed on February 27, 2006, File No. 1-10762.)
10.10†	Harvest Natural Resources 2006 Long Term Incentive Plan. (Incorporated by reference to Exhibit 4.5 to our Registration Statement on Form S-8 filed on June 1, 2006 [Registration Statement No. 333-134630].)
10.11†	Form of 2006 Long Term Incentive Plan Stock Option Agreement. (Incorporated by reference to Exhibit 10.2 to our Form 10-Q filed on August 9, 2006, File No. 1-10762.)
10.12†	Form of 2006 Long Term Incentive Plan Director Restricted Stock Agreement. (Incorporated by reference to Exhibit 10.3 to our Form 10-Q filed on August 9, 2006, File No. 1-10762.)

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10.13†	Form of 2006 Long Term Incentive Plan Employee Restricted Stock Agreement. (Incorporated by reference to Exhibit 10.4 to our Form 10-Q filed on August 9, 2006, File No. 1-10762.)
10.14†	Stock Unit Award Agreement dated September 15, 2005 between Harvest Natural Resources, Inc. and James A. Edmiston. (Incorporated by reference to Exhibit 10.5 to our Form 10-Q filed on August 9, 2006, File No. 1-10762.)
10.15†	Stock Unit Award Agreement dated March 2, 2006 between Harvest Natural Resources, Inc. and James A. Edmiston. (Incorporated by reference to Exhibit 10.6 to our Form 10-Q filed on August 9, 2006, File No. 1-10762.)
10.16†	Form of 2006 Long Term Incentive Plan Stock Option Agreement – Five Year Vesting, Seven Year Term. (Incorporated by reference to Exhibit 10.33 to our Form 10-K filed on March 13, 2007, File No. 1-10762.)
10.17†	Amendment to Harvest Natural Resources 2006 Long Term Incentive Plan adopted July 19, 2006. (Incorporated by reference to Exhibit 10.1 to our Form 10-Q filed on May 3, 2007, File No. 1-10762.)
10.18†	Stock Option Agreement dated May 7, 2007 between Harvest Natural Resources, Inc. and Keith L. Head. (Incorporated by reference to Exhibit 10.2 to our Form 10-Q filed on July 25, 2007, File No. 1-10762.)
10.19	Contract for Conversion to a Mixed Company between Corporación Venezolana del Petróleo, S.A., Harvest-Vinccler, S.C.A. and HNR Finance B.V. (Incorporated by reference to Exhibit 10.1 to our Form 10-Q filed on November 1, 2007, File No. 1-10762.)
10.20†	Stock Option Agreement dated May 19, 2008 between Harvest Natural Resources, Inc. and Stephen C. Haynes. (Incorporated by reference to Exhibit 10.2 to our Form 10-Q filed on August 7, 2008, File No. 1-10762.)
10.21†	2010 Long Term Incentive Plan. (Incorporated by reference to Appendix A to the Company’s Definitive Proxy Statement on Schedule 14A filed with the Securities and Exchange Commission on April 9, 2010, File No. 1-10762.)
10.22†	Form of 2010 Long Term Incentive Plan Employee Restricted Stock Award Agreement. (Incorporated by reference to Exhibit 10.2 to our Form 10-Q filed on August 9, 2010, File No. 1-10762.)
10.23†	Form of 2010 Long Term Incentive Plan Stock Option Award Agreement. (Incorporated by reference to Exhibit 10.3 to our Form 10-Q filed on August 9, 2010, File No. 1-10762.)
10.24†	Form of 2010 Long Term Incentive Plan Director Restricted Stock Award Agreement. (Incorporated by reference to Exhibit 10.30 to our Form 10-K filed on March 15, 2012 File No. 1- 10762.)
10.25†	Employment Agreement dated January 1, 2009 between Harvest Natural Resources, Inc. and Karl L. Nesselrode. (Incorporated by reference to Exhibit 10.30 to our Form 10-K filed on March 15, 2012, File No. 1-10762.)
10.26†	Employment Agreement dated January 1, 2009 between Harvest Natural Resources, Inc. and James A. Edmiston. (Incorporated by reference to Exhibit 10.31 to our Form 10-K filed on March 15, 2012, File No. 1-10762.)
10.27†	Employment Agreement dated January 1, 2009 between Harvest Natural Resources, Inc. and Keith L. Head. (Incorporated by reference to Exhibit 10.32 to our Form 10-K filed on March 15, 2012, File No. 1-10762.)
10.28†	Employment Agreement dated January 1, 2009 between Harvest Natural Resources, Inc. and Stephen C. Haynes. (Incorporated by reference to Exhibit 10.33 to our Form 10-K filed on March 15, 2012, File No. 1-10762.)

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10.29†	Employment Agreement dated May 31, 2008 between Harvest Natural Resources, Inc. and Robert Speirs. (Incorporated by reference to Exhibit 10.34 to our Form 10-K filed on March 15, 2012, File No. 1-10762.)
10.30†	Form of Stock Appreciation Right Award Agreement. (Incorporated by reference to Exhibit 10.1 to our Form 10-Q filed on August 4, 2009, File No. 1-10762.)
10.31†	Form of Stock Unit Award Agreement. (Incorporated by reference to Exhibit 10.2 to our Form 10-Q filed on August 4, 2009, File No. 1-10762.)
10.32†	Form of Director Stock Unit Award Agreement. (Incorporated by reference to Exhibit 10.3 to our Form 10-Q filed on August 9, 2012, File No. 1-10762.)
10.33†	Form of Employee Stock Unit Award Agreement. (Incorporated by reference to Exhibit 10.4 to our Form 10-Q filed on August 9, 2012, File No. 1-10762.)
10.34†	Form of Employee Stock Appreciation Right Award Agreement. (Incorporated by reference to Exhibit 10.5 to our Form 10-Q filed on August 9, 2012, File No. 1-10762.)
10.35	Equity Distribution Agreement, dated March 30, 2012 by and between the Company and Knight Capital Americas, L.P. (Incorporated by reference to Exhibit 1.1 to our Form 8-K filed on March 30, 2012, File No. 1-10762.)
10.36	Share Purchase Agreement dated June 21, 2012, by and among HNR Energia BV, Harvest Natural Resources, Inc. and PT Pertamina (Persero). (Incorporated by reference to Exhibit 2.1 to our Form 8-K filed on June 21, 2012, file No. 1-10762.)
10.37	Guarantee of Harvest Natural Resources, Inc. dated June 21, 2012. (Incorporated by reference to Exhibit 2.2 to our Form 8-K filed on June 21, 2012, file No. 1-10762.)
10.38	Securities Purchase Agreement, dated as of October 11, 2012, among Harvest Natural Resources, Inc. and the purchasers named therein. (Incorporated by reference to Exhibit 10.1 to our Form 8-K filed on October 15, 2012, File No. 1-10762).
10.39	Form of Subscription Agreement between Harvest Natural Resources, Inc. and certain purchasers of Harvest’s common stock in private placements in October and November 2013.
10.40	Subscription Agreement, dated November 25, 2013, between Harvest Natural Resources, Inc. and MSD Credit Opportunity Master Fund, L.P.
10.41	Share Purchase Agreement dated December 16, 2013, by and among HNR Energia B.V., Harvest Natural Resources, Inc., Petroandina Resources Corporation N.V. and Pluspetrol Resources Corporation B.V. (Incorporated by reference to Exhibit 2.1 to our Form 8-K filed on December 20, 2013, file No. 1-10762.)
10.42	Shareholders’ Agreement dated as of December 16, 2013, by and among HNR Energia B.V. and Petroandina Resources Corporation N.V.
21.1	List of subsidiaries.
23.1	Consent of UHY LLP.
23.2	Consent of PricewaterhouseCoopers LLP.
23.3	Consent of Ryder Scott Company, LP.
23.4	Consent of PGFA Perales, Pistone & Asociados.
31.1	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 executed by James A. Edmiston, President and Chief Executive Officer.

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31.2	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 executed by Stephen C. Haynes, Vice President, Chief Financial Officer and Treasurer.
32.1	Certification accompanying Annual Report on Form 10-K pursuant to Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. Section 1350 executed by James A. Edmiston, President and Chief Executive Officer.
32.2	Certification accompanying Annual Report on Form 10-K pursuant to Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. Section 1350 executed by Stephen C. Haynes, Vice President, Chief Financial Officer and Treasurer.
99.1	Financial statements of Petrodelta, S.A. for the years ended December 31, 2013 and 2012.
99.2	Reserve report dated February 26, 2014 prepared by Ryder Scott Company for HNR Finance B.V.
101.INS	XBRL Instance Document
101.SCH	XBRL Schema Document
101.CAL	XBRL Calculation Linkbase Document
101.LAB	XBRL Label Linkbase Document
101.PRE	XBRL Presentation Linkbase Document
101.DEF	XBRL Definition Linkbase Document

^†  Identifies management contracts or compensating plans or arrangements required to be filed as an exhibit hereto pursuant to Item 15(a) and (b) of Form 10-K.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and

Stockholders of Harvest Natural Resources, Inc.

We have audited Harvest Natural Resources, Inc. and subsidiaries’ (the “Company”) internal control over financial reporting as of December 31, 2013, based on criteria established in Internal Control – Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying management report on internal control over financial reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, Harvest Natural Resources, Inc. and subsidiaries maintained, in all material respects, effective internal control over financial reporting as of December 31, 2013, based on criteria established in Internal Control – Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of Harvest Natural Resources, Inc. and subsidiaries as of December 31, 2013, and the related consolidated statements of operations and comprehensive income (loss), stockholders’ equity and cash flows for the year then ended and our report dated March 17, 2014 expressed an unqualified opinion on those consolidated financial statements.

/s/ UHY LLP

Houston, Texas

March 17, 2014

S-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and

Stockholders of Harvest Natural Resources, Inc.

We have audited the accompanying consolidated balance sheet of Harvest Natural Resources, Inc. and subsidiaries (the “Company”) as of December 31, 2013, and the related consolidated statements of operations and comprehensive income (loss), stockholders’ equity and cash flows for the year then ended. The Company’s management is responsible for these consolidated financial statements. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Harvest Natural Resources, Inc. and subsidiaries as of December 31, 2013, and the consolidated results of their operations and their cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America.

We also audited the reclassification adjustments described in Note 16 that were applied to the segment information as of December 31, 2012 and for each of the two years in the period ended December 31, 2012. In our opinion, such reclassification adjustments are appropriate and have been properly applied to the segment information to conform to the current year presentation.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of Harvest Natural Resources, Inc. and subsidiaries’ internal control over financial reporting as of December 31, 2013, based on criteria established in Internal Control – Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and our report dated March 17, 2014 expressed an unqualified opinion on the effective operation of internal control over financial reporting.

/s/ UHY LLP

Houston, Texas

March 17, 2014

S-2

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of Harvest Natural Resources, Inc.

In our opinion, the consolidated balance sheet as of December 31, 2012 and the related consolidated statement of operations and comprehensive income (loss), of shareholders’ equity and of cash flows for each of two years in the period ended December 31, 2012, before the effects of the adjustments to retrospectively reflect the changes in the presentation of reportable segments described in Note 16, present fairly, in all material respects, the financial position of Harvest Natural Resources, Inc. and its subsidiaries at December 31, 2012, and the results of their operations and their cash flows for each of the two years in the period ended December 31, 2012, in conformity with accounting principles generally accepted in the United States of America (the 2012 financial statements before the effects of the adjustments discussed in Note 16 are not presented herein). These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits, before the effects of the adjustments described above, of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

We were not engaged to audit, review, or apply any procedures to the adjustments to retrospectively reflect the changes in the presentation of reportable segments described in Note 16 and accordingly, we do not express an opinion or any other form of assurance about whether such adjustments are appropriate and have been properly applied. Those adjustments were audited by other auditors.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company has not generated revenue and has incurred recurring losses and negative cash flows from operations that raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/PricewaterhouseCoopers LLP

Houston, Texas

May 2, 2013, except with respect to our opinion on the consolidated financial statements insofar as it relates to the discontinued operations related to the Oman operations as described in Note 5 to the financial statements, as to which the date is January 28, 2014

S-3

HARVEST NATURAL RESOURCES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

	December 31,
	2013			2012
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	120,897		$	72,627
Restricted cash		148			1,000
Accounts receivable, net		1,962			2,955
Advances to and receivables from equity affiliate		0			656
Deferred income taxes		81			821
Prepaid expenses and other		2,030			1,460
TOTAL CURRENT ASSETS		125,118			79,519
LONG-TERM RECEIVABLE – EQUITY AFFILIATE		15,097			14,346
INVESTMENT IN EQUITY AFFILIATE		485,401			412,823
PROPERTY AND EQUIPMENT:
Oil and gas properties (successful efforts method)		108,013			81,792
Other administrative property, net		378			744
TOTAL PROPERTY AND EQUIPMENT, NET		108,391			82,536
OTHER ASSETS		873			7,613
TOTAL ASSETS	$	734,880		$	596,837
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Accounts payable, trade and other	$	4,398		$	3,970
Accrued expenses		22,659			30,748
Accrued interest		380			624
Income taxes payable		2,178			102
Current deferred tax liability		43,162			0
Current portion – long term debt		77,480			0
Note payable to noncontrolling interest owner		6,109			0
Other current liabilities		419			3,538
TOTAL CURRENT LIABILITIES		156,785			38,982
LONG – TERM DEBT		0			74,839
WARRANT DERIVATIVE LIABILITY		1,953			5,470
LONG-TERM DEFERRED TAX LIABILITY		29,787			0
OTHER LONG – TERM LIABILITIES		558			1,108
COMMITMENTS AND CONTINGENCIES (See Note 13)
EQUITY
STOCKHOLDERS’ EQUITY:
Preferred stock, par value $0.01 a share; authorized 5,000 shares; outstanding, none		0			0
Common stock, par value $0.01 a share; authorized 80,000 shares at December 31, 2013 and 2012; issued 48,666 and 45,882 shares at December 31, 2013 and 2012, respectively		487			458
Additional paid-in capital		276,083			263,646
Retained earnings		92,282			181,378
Treasury stock, at cost, 6,551 shares at December 31, 2013 and (2012: 6,527 shares)		(66,222	)		(66,145	)
TOTAL HARVEST STOCKHOLDERS’ EQUITY		302,630			379,337
NONCONTROLLING INTERESTS		243,167			97,101
TOTAL EQUITY		545,797			476,438
TOTAL LIABILITIES AND EQUITY	$	734,880		$	596,837

See accompanying notes to consolidated financial statements.

S-4

HARVEST NATURAL RESOURCES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(in thousands, except per share data)

	Year Ended December 31,
	2013			2012			2011
EXPENSES:
Depreciation and amortization	$	341		$	391		$	439
Exploration expense		15,155			8,838			11,950
Impairment expense		575			2,900			3,335
Dry hole costs		0			685			40,003
General and administrative		29,365			26,012			21,428
		45,436			38,826			77,155
LOSS FROM OPERATIONS		(45,436	)		(38,826	)		(77,155	)
OTHER NON-OPERATING INCOME (EXPENSE):
Investment earnings and other		280			348			665
Loss on sale of interest in Harvest Holding		(22,994	)		0			0
Unrealized gain (loss) on derivatives		3,517			(600	)		9,786
Interest expense		(4,495	)		(1,590	)		(7,159	)
Debt conversion expense		0			(3,645	)		0
Loss on extinguishment of debt		0			(5,425	)		(13,132	)
Foreign currency transaction losses		(820	)		(113	)		(132	)
Other non-operating expenses		(1,849	)		(2,905	)		(1,375	)
		(26,361	)		(13,930	)		(11,347	)
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES		(71,797	)		(52,756	)		(88,502	)
INCOME TAX EXPENSE (BENEFIT)		73,087			(609	)		1,057
LOSS FROM CONTINUING OPERATIONS BEFORE EARNINGS FROM EQUITY AFFILIATES		(144,884	)		(52,147	)		(89,559	)
EARNINGS FROM EQUITY AFFILIATES		72,578			67,769			73,451
INCOME (LOSS) FROM CONTINUING OPERATIONS		(72,306	)		15,622			(16,108	)
DISCONTINUED OPERATIONS:
Loss from discontinued operations		(5,150	)		(14,410	)		(14,007	)
Gain on sale of assets		0			0			106,000
Income tax expense on discontinued operations		0			0			(5,748	)
Income (loss) from discontinued operations		(5,150	)		(14,410	)		86,245
NET INCOME (LOSS)		(77,456	)		1,212			70,137
LESS: NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS		11,640			13,423			14,177
NET INCOME (LOSS) ATTRIBUTABLE TO HARVEST [COMPREHENSIVE INCOME (LOSS)]	$	(89,096	)	$	(12,211	)	$	55,960
BASIC EARNINGS (LOSS) PER SHARE:
Income (loss) from continuing operations	$	(2.12	)	$	0.06		$	(0.89	)
Discontinued operations		(0.13	)		(0.39	)		2.53
Basic earnings (loss) per share	$	(2.25	)	$	(0.33	)	$	1.64
DILUTED EARNINGS (LOSS) PER SHARE:
Income (loss) from continuing operations	$	(2.12	)	$	0.06		$	(0.89	)
Discontinued operations		(0.13	)		(0.39	)		2.53
Diluted earnings (loss) per share	$	(2.25	)	$	(0.33)		$	1.64

See accompanying notes to consolidated financial statements.

S-5

HARVEST NATURAL RESOURCES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands)

	Common Shares Issued		Common Stock		Additional Paid-in Capital		Retained Earnings			Treasury Stock			Non- Controlling Interests			Total Equity
BALANCE AT JANUARY 1, 2011		40,103	$	401	$	219,240	$	137,629		$	(65,543	)	$	69,501		$	361,228
Issuance of common shares:
Exercise of stock options		167		2		922		0			0			0			924
Restricted stock awards		273		2		2,028		0			0			0			2,030
Employee stock-based compensation		0		0		2,611		0			0			0			2,611
Conversion of 8.25% senior convertible notes		82		1		464		0			0			0			465
Purchase of treasury shares		0		0		0		0			(561	)		0			(561	)
Tax benefits related to equity compensation		0		0		2,535		0			0			0			2,535
Net income		0		0		0		55,960			0			14,177			70,137
BALANCE AT DECEMBER 31, 2011		40,625		406		227,800		193,589			(66,104	)		83,678			439,369
Issuance of common shares:
Exercise of stock options		122		1		718		0			0			0			719
Restricted stock awards		203		2		1,564		0			0			0			1,566
Employee stock-based compensation		0		0		1,934		0			0			0			1,934
Conversion of 8.25% senior convertible notes		4,932		49		29,058		0			0			0			29,107
Warrants issued		0		0		2,572		0			0			0			2,572
Purchase of treasury shares		0		0		0		0			(41	)		0			(41	)
Net income (loss)		0		0		0		(12,211	)		0			13,423			1,212
BALANCE AT DECEMBER 31, 2012		45,882	$	458		263,646		181,378			(66,145	)		97,101			476,438
Issuance of common shares:
Exercise of stock options		20		0		122		0			0			0			122
Sales of common shares		2,495		25		9,273		0			0			0			9,298
Restricted stock awards		269		4		924		0			0			.			928
Employee stock-based compensation		0		0		2,118		0			0			0			2,118
Purchase of treasury shares		0		0		0		0			(77	)		0			(77	)
Increase in equity held by noncontrolling interests due to sale of interest in affiliate														144,796			144,796
Dividend to noncontrolling interest owner		0		0		0		0			0			(10,370	)		(10,370	)
Net income (loss)		0		0		0		(89,096	)		0			11,640			(77,456	)
BALANCE AT DECEMBER 31, 2013		48,666	$	487	$	276,083	$	92,282		$	(66,222	)	$	243,167		$	545,797

See accompanying notes to consolidated financial statements.

S-6

HARVEST NATURAL RESOURCES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Year Ended December 31,
	2013			2012			2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	(77,456	)	$	1,212		$	70,137
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depletion, depreciation and amortization		354			423			1,272
Impairment expense		3,770			9,312			4,775
Dry hole costs		0			5,617			40,467
Amortization of debt financing costs		1,489			690			975
Amortization of discount on debt		2,641			543			2,876
Foreign currency transaction loss		436			0			0
Loss on sale of interest in Harvest Holding		22,994			0			0
Gain on sale of assets		0			0			(106,225	)
Debt conversion expense		0			2,915			0
Allowance for account and note receivable		0			5,180			0
Write off of accounts payable, carry obligation		0			(3,596	)		0
Loss on early extinguishment of debt		0			5,425			10,983
Earnings from equity affiliates		(72,578	)		(67,769	)		(73,451	)
Share-based compensation-related charges		3,046			3,500			4,642
Unrealized (gain) loss on derivatives		(3,517	)		600			(9,786	)
Changes in operating assets and liabilities:
Accounts and notes receivable		993			9,542			(10,025	)
Prepaid expenses and other		710			(718	)		4,065
Other assets		3,971			(87	)		(4,180	)
Accounts payable		428			(3,411	)		(623	)
Accrued expenses		3,790			4,757			7,475
Accrued interest		(244	)		(238	)		(942	)
Income taxes payable		2,076			(587	)		617
Deferred tax asset and liabilities		73,689			(821	)		0
Other current liabilities		(3,119	)		906			2,632
Other long term liabilities		(550	)		200			(927	)
NET CASH USED IN OPERATING ACTIVITIES		(37,077	)		(26,405	)		(55,243	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of assets		0			0			218,823
Additions of property and equipment		(43,906	)		(23,575	)		(72,180	)
Additions to assets held for sale		0			0			(33,930	)
Advances (to) from equity affiliate		(531	)		(414	)		(682	)
Proceeds from sale of interest in equity affiliates, net		124,045			0			1,385
(Increase) decrease in restricted cash		852			200			(1,200	)
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES		80,460			(23,789	)		112,216
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuances of common stock		9,420			719			924
Tax benefits related to equity compensation		0			0			2,535
Proceeds from issuance of long-term debt		0			66,480			0
Payments of long-term debt		0			0			(60,000	)
Treasury stock purchases		(77	)		0			0
Payments on note payable to noncontrolling interest owner		(4,260	)		0			0
Financing costs		(196	)		(3,324	)		(189	)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES .		4,887			63,875			(56,730	)
NET INCREASE IN CASH AND CASH EQUIVALENTS		48,270			13,681			243
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR		72,627			58,946			58,703
CASH AND CASH EQUIVALENTS AT END OF YEAR	$	120,897		$	72,627		$	58,946
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid during the year for interest expense (net of capitalization)	$	487		$	640		$	2,685
Cash paid during the year for income taxes	$	495		$	216		$	8,241

See accompanying notes to consolidated financial statements.

S-7

HARVEST NATURAL RESOURCES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

(in thousands, except share amounts)

Supplemental Schedule of Noncash Investing and Financing Activities:

	Year Ended December 31,
	2013			2012		2011
Increase (decrease) in current liabilities related to additions of property and equipment	$	(13,926	)	$	10,500	$	3,416
Non-cash distribution of note payable to noncontrolling interest owner	$	10,370		$	0	$	0

See Note 3 – Summary of Significant Accounting Policies, Other Assets for a discussion of certain non-cash asset transactions and Note 11 – Debt and Note 15 – Stock-Based Compensation and Stock Purchase Plans for a discussion of other non-cash equity transactions.

See accompanying notes to consolidated financial statements.

S-8

HARVEST NATURAL RESOURCES, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Note 1 – Organization

Harvest Natural Resources, Inc. (“Harvest”) is an independent energy company engaged in the acquisition, exploration, development, production and disposition of oil and natural gas properties since 1989, when it was incorporated under Delaware law.

We have acquired and developed significant interests in the Bolivarian Republic of Venezuela (“Venezuela”). Our Venezuelan interests are owned through Harvest-Vinccler Dutch Holding, B.V., a Dutch private company with limited liability (“Harvest Holding”). Our ownership of Harvest Holding is through HNR Energia, B.V. (“HNR Energia”) in which we have a direct controlling interest. Prior to December 16, 2013, we indirectly owned 80 percent of Harvest Holding and we had one partner, Oil & Gas Technology Consultants (Netherlands) Coöperatie U.A., (“Vinccler”, a controlled affiliate of Venezolana de Inversiones y Construcciones Clerico, C.A.), which owned the remaining noncontrolling interest in Harvest Holding of 20 percent. We do not have a business relationship with Vinccler outside of Venezuela. On December 16, 2013, Harvest and HNR Energia entered into a Share Purchase Agreement (“Share Purchase Agreement”) with Petroandina Resources Corporation N.V. (“Petroandina”, a wholly owned subsidiary of Pluspetrol Resources Corporation B.V. (“Pluspetrol”)) and Pluspetrol to sell all of our 80 percent equity interest in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement, when we sold a 29 percent equity interest in Harvest Holding for $125 million. This first transaction resulted in a loss on the sale of the interest in Harvest Holding of $23.0 million in the year ended December 31, 2013. As a result of this first sale, we indirectly own 51 percent of Harvest Holding beginning December 16, 2013 and the noncontrolling interest owners hold the remaining 49 percent with Petroandina having 29 percent and Vinccler continuing to own 20 percent. See Note 5 – Dispositions below for further information on this transaction.

Harvest Holding owns, indirectly through wholly owned subsidiaries, a 40 percent of Petrodelta, S.A. (“Petrodelta”). Corporación Venezolana del Petroleo S.A. (“CVP”) and PDVSA Social S.A. own the remaining 56 percent and 4 percent, respectively, of Petrodelta. Petroleos de Venezuela S.A. (“PDVSA”) owns 100 percent of CVP and PDVSA Social S.A. Through our indirect 51 percent in Harvest Holding, we indirectly own a net 20.4 percent interest in Petrodelta for the period from December 16, 2013 to date, and prior to December 16, 2013 we indirectly owned a 32 percent interest in Petrodelta through our indirect 80 percent interest in Harvest Holding during this period.

In addition to its 40 percent interest in Petrodelta, Harvest Holding also indirectly owns 100 percent of Harvest Vinccler S.C.A. (“Harvest Vinccler”). Harvest Vinccler’s main business purposes are to assist us in the management of Petrodelta and in negotiations with PDVSA.

In addition to our interests in Venezuela, we also have the following projects:

• Offshore of the Republic of Gabon (“Gabon”) through the Dussafu Marin Permit (“Dussafu PSC”) (see Note 8 – Gabon),

• Mainly onshore in West Sulawesi in the Republic of Indonesia (“Indonesia”) through the Budong-Budong Production Sharing Contract (“Budong PSC”) (see Note 9 – Indonesia), and

• Offshore of the People’s Republic of China (“China”) through the Wab-21 Petroleum Contract (see Note 10 – China).

Note 2 – Liquidity

Historically, our primary ongoing source of cash has been dividends from Petrodelta and the sale of oil and gas properties. Our primary use of cash has been to fund oil and gas exploration projects, principal payments on debt, interest, and general and administrative costs. We require capital principally to fund the exploration and

S-9

development of new oil and gas properties. As is common in the oil and gas industry, we have various contractual commitments pertaining to exploration, development and production activities. See Note 8 – Gabon, Note 9 – Indonesia and Note 5 – Dispositions, Discontinued Operations for our contractual commitments.

The environments in which we operate are often difficult and the ability to operate successfully depends on a number of factors including our ability to control the pace of development, our ability to apply “best practices” in drilling and development, and the fostering of productive and transparent relationships with local partners, the local community and governmental authorities. Financial risks include our ability to control costs and attract financing for our projects. In addition, often the legal systems of certain countries are not mature, and their reliability can be uncertain. This may affect our ability to enforce contracts and achieve certainty in our rights to develop and operate oil and natural gas projects, as well as our ability to obtain adequate compensation for any resulting losses. Our strategy depends on our ability to have significant influence over operations and financial control.

Our operations are subject to various risks inherent in foreign operations. These risks may include, among other things, loss of revenue, property and equipment as a result of hazards such as expropriation, nationalization, war, insurrection, civil unrest, strikes and other political risks, increases in taxes and governmental royalties, being subject to foreign laws, legal systems and the exclusive jurisdiction of foreign courts or tribunals, renegotiation of contracts with governmental entities, changes in laws and policies, including taxes, governing operations of foreign-based companies, currency restrictions and exchange rate fluctuations and other uncertainties arising out of foreign government sovereignty over our international operations. Our international operations may also be adversely affected by the U.S. Foreign Corrupt Practices Act and similar worldwide anti-corruption laws, laws and policies of the United States affecting foreign policy, foreign trade, taxation and the possible inability to subject foreign persons to the jurisdiction of the courts in the United States.

As a result of the situation in Venezuela, the actions of the Venezuelan government which have and continue to adversely affect our operations and the expectation that dividends from Petrodelta will be minimal over the next few years, cash generated from operations has been limited and this has had a significant adverse effect on our ability to obtain financing to acquire and develop growth opportunities elsewhere. In the consolidated financial statements issued in the prior year, we discussed certain doubts about our ability to continue as a going concern. At the time of issuance, we expected that in 2013 we would not generate revenues, we would continue to generate losses from operations, and that our cash flows would not be sufficient to cover our operating expenses. While we believed that we would be able to raise additional capital through issuances of debt and/or equity or through sales of assets, our circumstances at such time raised substantial doubt about our ability to continue to operate as a going concern, and this was disclosed in the notes to the consolidated financial statements.

As discussed above under Share Purchase Agreement, on December 16, 2013, Harvest and HNR Energia entered into the Share Purchase Agreement with Petroandina and Pluspetrol, its parent, to sell all of our 80 percent equity interest in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement, when we sold a 29 percent equity interest in Harvest Holding for $125 million. Proceeds from the December 2013 sale of the 29 percent equity interest in Harvest Holding are expected to be adequate to meet our short-term liquidity requirements. As discussed above and in Note 5 – Dispositions, Share Purchase Agreement below, on December 16, 2013, Harvest and HNR Energia entered into the Share Purchase Agreement with Petroandina and Pluspetrol to sell all of our 80 percent equity interest in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement, when we sold a 29 percent equity interest in Harvest Holding for $125 million. The second closing, for the sale of a 51 percent equity interest in Harvest Holding for a cash purchase price of $275 million, will be subject to, among other things, approval by the holders of a majority of our common stock and approval by the Ministerio del Poder Popular de Petroleo y Mineria representing the Government of Venezuela (which indirectly owns the other 60 percent interest in Petrodelta).

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We used a portion of the $125 million in proceeds from the sale of the 29 percent interest in Harvest Holding that we received on December 16, 2013, to redeem all of our 11% Senior Notes due 2014. The notes were redeemed on January 11, 2014, for $80.0 million, including principal and accrued and unpaid interest. The remaining $45.0 million of the proceeds from the sale of the 29 percent interest in Harvest Holding have been or will be used to pay costs associated with the sale of our Venezuelan interests, to pay severance costs, to make capital expenditures, to pay taxes related to the sale and for general operating expenses. Those remaining proceeds will also be used to repurchase certain outstanding warrants if our stockholders approve the sale of our remaining Venezuelan interests, and if a “Fundamental Change” is consummated under the terms of those warrants.

We are currently marketing our non-Venezuelan assets and talking to potential buyers, and we intend to continue our consideration of a possible sale for some or all of our non-Venezuelan assets if we are able to negotiate a sale or sales in transactions that our Board of Directors believes are in the best interests of the Company and its stockholders. In the meantime, we intend to operate our business in the ordinary course and may ultimately decide to keep our non-Venezuelan assets and acquire additional assets.

If the proposed sale of our remaining Venezuelan interests is completed and/or the sale of other non-Venezuelan assets are completed, a significant portion of our assets will be cash from the proceeds of such transactions. However, the timing of the sale of our remaining 51 percent interest in Harvest Holding or sales of other assets is beyond our control and we will continue to have operating and capital requirements until these sales are completed. Depending on the timing of these events, we anticipate using a portion of the proceeds from the sale of 51 percent interest in Harvest Holding to pay for expenses and other costs related to the transaction, which we estimate will be approximately $4 million; to pay taxes related to the transaction, which we estimate will be approximately $51.1 million. In addition, if we do not sell our non-Venezuelan assets before the sale of the 51 percent interest in Harvest Holding, then we estimate that we will need to retain a portion of the proceeds to fund projected general operating expenses and capital expenditures. Some of these costs will be paid from funds remaining from the proceeds of the initial sale of the 29 percent interest in Harvest Holding. If we sell our non-Venezuelan assets before the sale of the remaining 51 percent interest in Harvest Holding, then our requirements for projected general operating expenses and capital expenditures would be reduced. We will also use these funds to pay any severance or other costs during 2014 associated with the possible severance of some of our personnel in connection with a downsizing of the Company both related to the sale of our Venezuelan interests and related to any sale of our non-Venezuelan assets, if our Board of Directors determines that a downsizing would be in our best interests. We estimate these costs to be approximately $20 million.

Although we are currently marketing our non-Venezuelan assets and talking to potential buyers, we intend to operate our business in the ordinary course and may ultimately decide to keep our non-Venezuelan assets and acquire additional assets. Since we no longer have any obligations under the 11% Senior Notes due 2014, and given that we do not currently have any operating cash inflows, we may also decide to access additional capital through equity or debt sales; however, there can be no assurance that such financing will be available to the Company or on terms that are acceptable to the Company.

Note 3 – Summary of Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of all wholly-owned and majority-owned subsidiaries. All intercompany profits, transactions and balances have been eliminated. Third-party interests in our majority-owned subsidiaries are presented as noncontrolling interests.

Presentation of Comprehensive Income (Loss)

We adopted ASU No. 2011-05 (ASU 2011-05), which is included in ASC 220, “Comprehensive Income”, effective January 1, 2012 and have elected to utilize the “single continuous statement” for presentation of all nonowner changes in stockholders’ equity.

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Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles in the United States (“USGAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Reporting and Functional Currency

The United States Dollar (“U.S. Dollar”) is the reporting and functional currency for all of our controlled subsidiaries and Petrodelta. Amounts denominated in non-U.S. Dollar currencies are re-measured into U.S. Dollars, and all currency gains or losses are recorded in the consolidated statements of operations and comprehensive income (loss). There are many factors that affect foreign exchange rates and the resulting exchange gains and losses, many of which are beyond our influence.

See Note 6 – Investment in Equity Affiliates and Note 7 – Venezuela for a discussion of currency exchange rates and currency exchange risk on Petrodelta’s and Harvest Vinccler’s businesses.

Cash and Cash Equivalents

Cash equivalents include money market funds and short term certificates of deposit with original maturity dates of less than three months.

Restricted Cash

Restricted cash is classified as current or non-current based on the terms of the agreement. Restricted cash at December 31, 2013 represents cash held in a U.S. bank used as collateral for a customs bond for the Dussafu PSC. Restricted cash at December 31, 2012 represents cash held in a U.S. bank used as collateral for a standby letter of credit issued in support of a performance bond for a joint study.

Financial Instruments

Financial instruments, which potentially subject us to concentrations of credit risk, are primarily cash and cash equivalents, accounts receivable, dividend receivable, notes payable and derivative financial instruments. We maintain cash and cash equivalents in bank deposit accounts with commercial banks with high credit ratings, which, at times may exceed the federally insured limits. We have not experienced any losses from such investments. Concentrations of credit risk with respect to accounts receivable are limited due the nature of our receivables, which include primarily income tax receivables. In the normal course of business, collateral is not required for financial instruments with credit risk.

Investment in Equity Affiliates

We evaluate our investments in unconsolidated companies under ASC 323, “Investments – Equity Method and Joint Ventures.” Investments in which we have significant influence are accounted for under the equity method of accounting. Under the equity method, Investment in Equity Affiliates is increased by additional investments and earnings and decreased by dividends and losses.

We review our Investment in Equity Affiliates for impairment whenever events and circumstances indicate a loss in investment value is other than a temporary decline. There are many factors to consider when evaluating an equity investment for possible impairment. Currency devaluations, inflationary economies, and cash flow analysis are some of the factors we consider in our evaluation for possible impairment. At December 31, 2013, we reviewed our investment in Petrodelta taking into consideration the terms of the Share Purchase Agreement

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(see Note 5 – Dispositions, Share Purchase Agreement). The purchase price under the Share Purchase Agreement indicates a valuation that approximates the carrying value of our equity investment in Petrodelta, the dividend receivable and the advances to this equity affiliate. As such, we concluded that there was no impairment to our equity investment as of December 31, 2013. If the sale of the remaining 51 percent interest in Harvest Holding is completed, we expect to recognize a gain on the transaction.

We measure and disclose our noncontrolling interests in accordance with the provisions of ASC 810 “Consolidation”. Our noncontrolling interests relate to interests in Harvest Holding held by Petroandina (29 percent) and Vinccler (20 percent) (see Note 1 – Organization).

Oil and Gas Properties

The major components of property and equipment are as follows (in thousands):

	As of December 31,
	2013			2012
Unproved property costs	$	103,917		$	78,453
Oilfield inventories		4,096			3,339
Other administrative property		2,710			2,954
Total property and equipment		110,723			84,746
Accumulated depreciation		(2,332	)		(2,210	)
Total property and equipment, net	$	108,391		$	82,536

Property and equipment are stated at cost less accumulated depletion, depreciation and amortization (“DD&A”). Costs of improvements that appreciably improve the efficiency or productive capacity of existing properties or extend their lives are capitalized. Maintenance and repairs are expensed as incurred. Upon retirement or sale, the cost of property and equipment, net of the related accumulated DD&A, is removed and, if appropriate, gains or losses are recognized in investment earnings and other. We did not record any depletion expense in the years ended December 31, 2013 and 2012 or 2011 as there was no production related to proved oil and gas properties other than properties classified as held for sale.

We follow the successful efforts method of accounting for our oil and gas properties. Under this method, exploration costs such as exploratory geological and geophysical costs, delay rentals and exploration overhead are charged against earnings as incurred. Costs of drilling exploratory wells are capitalized pending determination of whether proved reserves can be attributed to the area as a result of drilling the well. If management determines that proved reserves, as that term is defined in Securities and Exchange Commission (“SEC”) regulations, have not been discovered, capitalized costs associated with the drilling of the exploratory well are charged to expense. Costs of drilling successful exploratory wells, all development wells, and related production equipment and facilities are capitalized and depleted or depreciated using the unit-of-production method as oil and gas is produced. During the year ended December 31, 2013, we expensed no dry hole costs. During the year ended December 31, 2012, we expensed to dry hole costs $0.7 million related to the drilling of Karama-1 (“KD-1”) and first sidetrack, KD-1ST, on the Budong PSC. See Note 9 – Indonesia.

Leasehold acquisition costs are initially capitalized. Acquisition costs of unproved leaseholds are assessed for impairment during the holding period. Costs of maintaining and retaining unproved leaseholds, as well as impairment of unsuccessful leases, are included in exploration expense. Impairment is based on specific identification of the lease. Costs of expired or abandoned leases are charged to exploration expense, while costs of productive leases are transferred to proved oil and gas properties.

Proved oil and gas properties are reviewed for impairment at a level for which identifiable cash flows are independent of cash flows of other assets when facts and circumstances indicate that their carrying amounts may not be recoverable. In performing this review, future net cash flows are determined based on estimated future oil

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and gas sales revenues less future expenditures necessary to develop and produce the reserves. If the sum of these undiscounted estimated future net cash flows is less than the carrying amount of the property, an impairment loss is recognized for the excess of the property’s carrying amount over its estimated fair value, which is generally based on discounted future net cash flows. We did not have any proved oil and gas properties in 2013, 2012 or 2011.

Costs of drilling and equipping successful exploratory wells, development wells, asset retirement liabilities and costs to construct or acquire offshore platforms and other facilities, are depleted using the unit-of-production method based on total estimated proved developed reserves. Costs of acquiring proved properties, including leasehold acquisition costs transferred from unproved leaseholds, are depleted using the unit-of-production method based on total estimated proved reserves. All other properties are stated at historical acquisition cost, net of allowance for impairment, and depreciated using the straight-line method over the useful lives of the assets.

Unproved property costs, excluding oilfield inventories, consist of (in thousands):

	As of December 31,
	2013		2012
Budong PSC	$	4,470	$	5,219
Dussafu PSC		99,447		73,234
Total unproved property costs	$	103,917	$	78,453

During the year ended December 31, 2013, we recorded impairment expense related to our Budong project in Indonesia ($0.6 million) and our project in Colombia ($3.2 million, which is reflected in discontinued operations). During the year ended December 31, 2012, we impaired the carrying value of Block 64 EPSA in Oman (which is reflected in discontinued operations) ($6.4 million) and WAB -21 in China ($2.9 million). During the year ended December 31, 2011, we impaired the carrying value of West Bay ($3.3 million).

Other Administrative Property

Furniture, fixtures and equipment are recorded at cost and depreciated using the straight-line method over their estimated useful lives, which range from three to five years. Leasehold improvements are recorded at cost and amortized using the straight-line method over the life of the applicable lease. For the year ended December 31, 2013, depreciation expense was $0.3 million ($0.4 million and $0.4 million for the years ended December 31, 2012 and 2011, respectively).

Other Assets

Other assets consist of deferred financing costs, a long-term receivable for value added tax (“VAT”) credits related to the Budong PSC, and prepaid expenses which are expected to be realized in the next 12 to 24 months. Deferred financing costs relate to specific financing and are amortized over the life of the financing to which the costs relate using the interest rate method. At December 31, 2013 the deferred financing costs were reclassified to prepaid expenses in current assets (see Note 11 – Debt). The VAT receivable is reimbursed through the sale of hydrocarbons. During the year ended December 31, 2013, a valuation allowance of $2.8 million was charged to general and administrative expenses on this VAT receivable which we do not expect to recover (see Note 9 – Indonesia). Other Assets at December 31, 2013 and 2012 also includes a blocked payment of $0.7 million net to our 66.667 percent interest related to our drilling operations in Gabon in accordance with the U.S. sanctions against Libya as set forth in Executive Order 13566 of February 25, 2011, and administered by the United States Treasury Department’s Office of Foreign Assets Control (“OFAC”). See Note 13 – Commitments and Contingencies.

	As of December 31,
	2013		2012
	(in thousands)
Deferred financing costs	$	0	$	3,111
Long-term VAT receivable		0		3,440
Long-term prepaid expenses		139		328
Gabon PSC – blocked payment (net to our 66.667% interest)		734		734
	$	873	$	7,613

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Reserves

We measure and disclose our oil and gas reserves in accordance with the provisions of the SEC’s Modernization of Oil and Gas Reporting and ASC 932, “Extractive Activities – Oil and Gas” (“ASC 932”). All of our reserves are owned through our equity investment in Petrodelta. We do not have any wholly owned reserves at December 31, 2013 or 2012.

Capitalized Interest

We capitalize interest costs for qualifying oil and gas properties. The capitalization period begins when expenditures are incurred on qualified properties, activities begin which are necessary to prepare the property for production and interest costs have been incurred. The capitalization period continues as long as these events occur. The average additions for the period are used in the interest capitalization calculation. During the year ended December 31, 2013, we capitalized interest costs for qualifying oil and gas property additions of $8.3 million ($3.0 million and $2.3 million during the years ended December 31, 2012 and 2011, respectively).

Derivative Financial Instruments

Under ASC 480 “Distinguishing Liabilities From Equity”, certain of our financial instruments with anti-dilution protection features do not meet the conditions to obtain equity classification, as there are conditions which may require settlement by transferring assets, and are required to be carried as derivative liabilities, at fair value, with changes in fair value reflected in our consolidated statements of operations and comprehensive income (loss). See Note 12 – Warrant Derivative Liabilities for additional disclosures related to the warrant derivative financial instruments issued under the warrant agreements dated November 2010 in connection with a $60 million term loan facility (the “Warrants”). In the occurrence of a fundamental change, we are required to repurchase the Warrants at the higher of (1) the fair market value of the warrant and (2) a valuation based on a computation of the option value of the Warrant using the Black-Scholes calculation method using the assumptions described in the Warrant Agreement. A fundamental change is defined as “the occurrence of one of the following events: a) a person or group becomes the direct or indirect owner of more than 50% of the voting power of the outstanding common stock, b) a merger event or similar transaction in which the majority owners before the transaction fail to own a majority of the voting power of the Company after the transaction, and c) approval of a plan of liquidation or dissolution of the Company or sale of all or substantially all of the Company’s assets.”

Fair Value Measurements

We measure and disclose our fair values in accordance with the provisions of ASC 820 “Fair Value Measurements and Disclosures” (“ASC 820”). ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price) and establishes a three-level hierarchy, which encourages an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of the hierarchy are defined as follows:

• Level 1 – Inputs to the valuation techniques that are quoted prices in active markets for identical assets or liabilities.

• Level 2 – Inputs to the valuation techniques that are other than quoted prices but are observable for the assets or liabilities, either directly or indirectly.

• Level 3 – Inputs to the valuation techniques that are unobservable for the assets or liabilities.

Financial instruments, which potentially subject us to concentrations of credit risk, are primarily cash and cash equivalents, accounts receivable, advances to equity affiliate, dividend receivable, long-term debt and warrant derivative liability. We maintain cash and cash equivalents in bank deposit accounts with commercial banks with high

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credit ratings, which, at times may exceed the federally insured limits. We have not experienced any losses from such investments. Concentrations of credit risk with respect to accounts receivable are limited due to the nature of our receivables. In the normal course of business, collateral is not required for financial instruments with credit risk.

The estimated fair value of cash, accounts receivable and accounts payable approximates their carrying value due to their short-term nature (Level 1). The estimated fair value of advances to equity affiliate and dividend receivable approximates their carrying value as it is the estimated amount we would receive from a third party to assume the receivables (Level 2). The following disclosure of the estimated fair value of financial instruments is made in accordance with the requirements of ASC 825, Financial Instruments. The estimated fair value amounts have been determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The following table presents the estimated fair values of our fixed interest rate, long-term debt instrument (Level 2), excluding the embedded derivative.

	As of December 31, 2013
	Carying    Value		Fair    Value
	(in thousands)
11% senior unsecured notes (Level 2)	$	77,480	$	79,750

As discussed in Note 11 – Debt, the 11% senior notes were redeemed at face value on January 11, 2014 following a notice of redemption issued in December 2013. Therefore, the fair value of our fixed interest debt instruments is stated at the redemption amount.

Derivative Financial Instruments

The following tables set forth by level within the fair value hierarchy our financial liabilities that were accounted for at fair value as of December 31, 2013 and 2012. As required by ASC 820, a financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of fair value liabilities and their placement within the fair value hierarchy levels. See Note 12 – Warrant Derivative Liability for a description and discussion of our warrant derivative liability and Note 11 – Debt for a description of our long-term debt embedded derivative liability as well as a description of the valuation models and inputs used to calculate the fair value of these derivative liabilities.

	As of December 31, 2013
	Level 1		Level 2		Level 3		Total
	(in thousands)
Liabilities:
Warrant derivative liability	$	0	$	0	$	1,953	$	1,953
Embedded derivative-debt		0		0		0		0
Total derivative liabilities	$	0	$	0	$	1,953	$	1,953

	As of December 31, 2012
	Level 1		Level 2		Level 3		Total
	(in thousands)
Liabilities:
Warrant derivative liability	$	0	$	0	$	5,470	$	5,470
Embedded derivative-debt		0		0		0		0
Total derivative liabilities	$	0	$	0	$	5,470	$	5,470

We record the net change in the fair value of the derivative positions listed above in unrealized gain (loss) on warrant derivative liabilities in our consolidated statements of operations and comprehensive income (loss).

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During the year ended December 31, 2013, an unrealized gain of $3.5 million was recorded to reflect the change in fair value of the warrants ($0.6 million unrealized loss and $9.8 million unrealized gain during the years ended December 31, 2012 and 2011, respectively).

Changes in Level 3 Instruments Measured at Fair Value on a Recurring Basis

The following table provides a reconciliation of financial liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3).

	December 31, 2013			December 31, 2012
	(in thousands)
Financial liabilities:
Beginning balance	$	5,470		$	4,870
Unrealized change in fair value		(3,517	)		600
Ending balance	$	1,953		$	5,470

During the year ended December 31, 2013, there were no transfers between Level 1, Level 2 and Level 3 liabilities.

Share-Based Compensation

We use a fair value based method of accounting for stock-based compensation. We utilize the Black-Scholes option pricing model to measure the fair value of stock options and stock appreciation rights (“SARs”). Restricted stock and restricted stock units (“RSUs”) are measured at their intrinsic values. See Note 15 – Stock-Based Compensations and Stock Purchase Plans.

Income Taxes

Deferred income taxes reflect the net tax effects, calculated at currently enacted rates, of (a) future deductible/taxable amounts attributable to events that have been recognized on a cumulative basis in the financial statements or income tax returns, and (b) operating loss and tax credit carryforwards. A valuation allowance for deferred tax assets is recorded when it is more likely than not that the benefit from the deferred tax asset will not be realized.

We classify interest related to income tax liabilities and penalties as applicable, as interest expense.

We do not provide deferred income taxes on undistributed earnings of our foreign subsidiaries for possible future remittances where we are able to assert that such earnings are permanently reinvested, or otherwise can be negotiated in a tax free manner, as part of our ongoing business.

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Valuation and Qualifying Accounts

Our valuation and qualifying accounts are comprised of the deferred tax valuation allowance, investment valuation allowance and VAT receivable valuation allowance. Balances and changes in these accounts are, in thousands:

			Additions
	Balance at Beginning of Year		Charged to Income		Charged to Other Accounts		Deductions From Reserves Credited to Income			Balance at End of Year
At December 31, 2013
Amounts deducted from applicable assets
Deferred tax valuation allowance	$	68,419	$	0	$	0	$	(8,843	)	$	59,576
Investment valuation allowance		1,350		0		0		0			1,350
VAT receivable valuation allowance		0		2,792		0		0			2,792
At December 31, 2012
Amounts deducted from applicable assets
Deferred tax valuation allowance	$	53,116	$	15,303	$	0	$	0		$	68,419
Investment valuation allowance		1,350		0		0		0			1,350
At December 31, 2011
Amounts deducted from applicable assets
Deferred tax valuation allowance	$	46,905	$	6,211	$	0	$	0		$	53,116
Investment valuation allowance		1,350		0		0		0			1,350

New Accounting Pronouncements

In January 2013, Financial Accounting Standards Board (“FASB”) issued ASU No. 2013-01, which is included in ASC 210, “Balance Sheet”, “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities” (“ASU No. 2013-01”). This update clarifies that the scope of ASU 2011-11: “Disclosures about Offsetting Assets and Liabilities” applies only to derivatives accounted for under ASC 815 “Derivatives and Hedging”, included bifurcated embedded derivatives, repurchase agreements and reverse repurchase agreements, and securities lending transactions that are either offset in accordance with ASC 210-20-45 or ASC 815-10-45 or subject to an enforceable master netting arrangement or similar agreement. ASU No. 2013-01 is effective for fiscal years and interim periods within those years, beginning on or after January 1, 2013. Entities should provide the required disclosures retrospectively for all comparative periods presented. The adoption of this guidance impacted presentation disclosures only and did not have an impact on our consolidated financial position, results of operation or cash flows.

In February 2013, FASB issued ASU No. 2013-04, which is included in ASC 405, “Liabilities”, “Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation is Fixed at the Reporting Date”. This update provides guidance for the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of the obligation with the scope of this guidance is fixed at the reporting date, except for obligations addressed within existing guidance in USGAAP. Examples of obligations within the scope to ASU No. 2013-04 include debt arrangements, other contractual obligations, and settled litigation and judicial rulings. ASU No. 2013-04 is effective for fiscal years and interim periods within those years beginning after December 15, 2013. Entities should provide the required disclosures retrospectively for all comparative periods presented. We are currently evaluating the impact of this guidance, but we expect that the adoption of this guidance will impact presentation disclosures only and will not have an impact on our consolidated financial position, results of operation or cash flows.

In July 2013, FASB issued ASU No. 2013-11 which is included in ASC 740 “Income Taxes”, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit

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Carryforward Exists.” This update provides guidance regarding the presentation of unrecognized tax benefits when net operating loss carryforward, a similar tax loss, or a tax credit carryforward are not available at the reporting date to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose. In such instances, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The amendment should be applied prospectively to all unrecognized tax benefits that exist at the effective date; however, retrospective application is permitted. The amendment is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. We are currently evaluating the impact of this guidance, but we expect that the adoption of this guidance will impact presentation disclosures only and will not have an impact on our consolidated financial position, results of operation or cash flows.

Note 4 – Earnings Per Share

Basic earnings per common share (“EPS”) are computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that would occur if securities or other contracts to issue common stock were exercised or converted into common stock.

	Year Ended December 31,
	2013			2012			2011
	(in thousands, except per share amounts)
Income (loss) from continuing operations(a)	$	(83,946	)	$	2,199		$	(30,285	)
Discontinued operations		(5,150	)		(14,410	)		86,245
Net income (loss) attributable to Harvest	$	(89,096	)	$	(12,211	)	$	55,960
Weighted average common shares outstanding		39,579			37,424			34,117
Effect of dilutive securities		0			167			0
Weighted average common shares, diluted		39,579			37,591			34,117
Basic Earnings (Loss) Per Share:
Income (loss) from continuing operations	$	(2.12	)	$	0.06		$	(0.89	)
Discontinued operations		(0.13	)		(0.39	)		2.53
Basic earnings (loss) per share	$	(2.25	)	$	(0.33	)	$	1.64
Diluted Earnings (Loss) Per Share:
Income (loss) from continuing operations	$	(2.12	)	$	0.06		$	(0.89	)
Income (loss) from discontinued operations		(0.13	)		(0.39	)		2.53
Diluted earnings (loss) per share	$	(2.25	)	$	(0.33	)	$	1.64

^(a)  Net of net income attributable to noncontrolling interests.

The year ended December 31, 2013 per share calculations above exclude 4.2 million options and 2.5 million warrants because they were anti-dilutive. The year ended December 31, 2012 per share calculations above exclude 3.9 million options and 2.4 million warrants because they were anti-dilutive. The year ended December 31, 2011 per share calculations above exclude 3.7 million options and 1.6 million warrants because they were anti-dilutive.

Note 5 – Dispositions

Share Purchase Agreement

On December 16, 2013, Harvest and HNR Energia entered into the Share Purchase Agreement with Petroandina and Pluspetrol, its parent, to sell all of our 80 percent equity interest in Harvest Holding to

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Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement, when we sold a 29 percent equity interest in Harvest Holding for $125 million. This first transaction resulted in a loss on the sale of the interest in Harvest Holding of $23.0 million in the year ended December 31, 2013. As a result of this first sale, we indirectly own 51 percent of Harvest Holding beginning December 16, 2013 and the noncontrolling interest owners hold the remaining 49 percent with Petroandina having 29 percent and Vinccler continuing to own 20 percent. We will continue to consolidate Harvest Holding’s results until the sale of the remaining 51 percent interest has been completed. The second closing, for the sale of a 51 percent equity interest in Harvest Holding for a cash purchase price of $275 million, will be subject to, among other things, approval by the holders of a majority of our common stock and approval by the Ministerio del Poder Popular de Petroleo y Mineria representing the Government of Venezuela (which indirectly owns the other 60 percent interest in Petrodelta).

HNR Energia and Petroandina also entered into a Shareholders’ Agreement (the “Shareholders’ Agreement”) on December 16, 2013, regarding the shares of Harvest Holding. The Shareholders’ Agreement becomes effective upon any termination of the Share Purchase Agreement before the second closing of the sale of the remaining shares of Harvest Holding.

The Share Purchase Agreement provides for certain put/call rights and termination payments under certain circumstances. If the Share Purchase Agreement is terminated because of the failure to obtain authorization by our stockholders, we will be required to pay Petroandina a fee of $3.0 million, and Petroandina will have the right to sell back to HNR Energia its 29 percent interest in Harvest Holding. If we terminate the Share Purchase Agreement and accept a superior proposal, we must pay Petroandina a break-up fee equal to $9.6 million and Petroandina has the right to sell back to HNR Energia, and HNR Energia has the right to cause Petroandina to sell back to HNR Energia, its interest in Harvest Holding. We must also pay the reasonable out-of-pocket expenses of Petroandina incurred in connection with the Share Purchase Agreement, up to $4 million, if the Share Purchase Agreement is terminated as a result of our breach of a representation or warranty or covenant, and in certain instances Petroandina also has the right and option to sell to HNR Energia its 29 percent interest. HNR Energia has the right and option to purchase from Petroandina its 29 percent interest in Harvest Holding on termination of the Share Purchase Agreement in certain other circumstances. Harvest has guaranteed HNR Energia’s obligations under the Share Purchase Agreement and the Shareholders’ Agreement.

During the term of the Share Purchase Agreement, Harvest Holding may not pay any dividends to HNR Energia, and therefore would not benefit from any dividends paid by Petrodelta during this period.

Discontinued Operations

As a result of the decision to not request an extension of the First Phase or enter the Second Phase of the Exploration and Production Sharing Agreement (“EPSA”) Al Ghubar / Qarn Alam license (“Block 64 EPSA”), Block 64 was relinquished effective May 23, 2013. The carrying value of Block 64 EPSA of $6.4 million was considered impaired and a related impairment expense was recorded during the year ended December 31, 2012. Operations in Oman were terminated, and the field office was closed May 31, 2013. We have no continuing operations in Oman.

In February 2013, we signed farm-out agreements on Block VSM14 and Block VSM15 in Colombia. Under the terms of the farm-out agreements, we had a 75 percent beneficial working interest and our partners had a 25 percent carried interest for the minimum exploratory work commitments on each block. We requested the legal assignment of the interest by the Agencia Nacional de Hidrocarburos (“ANH”), Colombia’s oil and gas regulatory authority, and approval of us as operator.

We have received notices of default from our partners for failing to comply with certain terms of the farmout agreements for Block VSM 14 and Block VSM 15, followed by notices of termination on November 27, 2013. As discussed further in Note 13 — Commitments and Contingencies, our partners have filed for arbitration of claims related to these agreements. We have accrued $2.0 million as of December 31, 2013 related to this matter. After evaluating these circumstances, we determined that it was appropriate to fully impair the costs

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associated with these interests, and we recorded an impairment charge of $3.2 million during the year ended December 31, 2013. As we no longer have any interests in Colombia, we have reflected the results in discontinued operations.

On May 17, 2011, we closed the transaction to sell the Antelope Project. The sale had an effective date of March 1, 2011. We received cash proceeds of approximately $217.8 million which reflects increases to the purchase price for customary adjustments and deductions for transaction related costs. We do not have any continuing involvement with the Antelope Project. The related gain on the sale was reported in discontinued operations in the second quarter of 2011.

During the year ended December 31, 2012, we incurred $0.1 million of expense related to settlement of royalty payments to the Mineral Management Services, write-offs of $5.2 million of accounts and note receivable and $3.6 million of accounts payable, carry obligation related to the settlement of all outstanding claims with a private third party on the Antelope Project. The note receivable related to a prospect leasing cost financing arrangement. The note receivable plus accrued interest was approximately $3.3 million at December 31, 2011, and was secured by a portion of the production from the Bar F #1-20-3-2 in Utah.

Oman operations, Colombia operations and the Antelope Project have been classified as discontinued operations. Revenue and income (loss) are shown in the table below:

	Year Ended December 31,
	2013			2012			2011
				(in thousands)
Revenue applicable to discontinued operations:
Oman	$	0		$	0		$	0
Colombia		0			0			0
Antelope Project		0			0			6,488
	$	0		$	0		$	6,488
Income (loss) from discontinued operations:
Oman	$	(674	)	$	(12,711	)	$	(11,371	)
Colombia		(4,476	)		0			0
Antelope Project		0			(1,699	)		97,616
	$	(5,150	)	$	(14,410	)	$	86,245

Note 6 – Investment in Equity Affiliates

Venezuela – Petrodelta, S.A.

Petrodelta’s reporting and functional currency is the U.S. Dollar. HNR Finance owns a 40 percent interest in Petrodelta. As discussed further in Note 5 – Dispositions, Share Purchase Agreement, on December 16, 2013, Harvest and HNR Energia entered into the Share Purchase Agreement with Petroandina and Pluspetrol, its parent, to sell all of our 80 percent equity interest in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement, when we sold a 29 percent equity interest in Harvest Holding for $125 million. This first transaction resulted in a loss on the sale of the interest in Harvest Holding of $23.0 million in the year ended December 31, 2013.

Petrodelta’s financial information is prepared in accordance with International Financial Reporting Standards (“IFRS”) which we have adjusted to conform to U.S. GAAP. The differences between IFRS and U.S. GAAP for which we adjust are:

• Deferred income tax: IFRS allows the inclusion of non-monetary temporary differences impacted by inflationary adjustments, whereas U.S. GAAP does not. In addition, we have adjusted for the impact on deferred income tax of other adjustments to arrive at net income under U.S. GAAP.

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• Depletion expense: Oil and gas reserves used by Petrodelta in calculating depletion expense under IFRS are provided by MENPET. MENPET reserves are not prepared using the guidance on extractive activities for oil and gas (ASC 932). At least annually at yearend, we prepare reserve reports for Petrodelta’s oil and gas reserves using ASC 932. On a quarterly basis, we recalculate Petrodelta’s depletion using the most recent reserve report using ASC 932.

• Windfall Profits Tax Credit: The April 2011 Windfall Profits Tax law included a provision wherein it considered that an exemption of the Windfall Profits Tax could be granted for the incremental production of projects and grass root developments until the specific investments are recovered. The projects deemed to qualify for the exemption have to be considered and approved on a case by case basis by MENPET. In March 2013, PDVSA requested from MENPET a Windfall Profits Tax exemption credit under provisions in the April 2011 Windfall Profits Tax law. The exemption was applied to several oil development projects, including Petrodelta. However, MENPET has not defined the projects qualifying for exemption or provided the guidance necessary to calculate the exemption. PDVSA issued to Petrodelta its estimated share of the exemption credit related to 2012 of $55.2 million ($36.4 million net of tax) based on PDVSA’s calculation and projects PDVSA deemed to qualify for the exemption. Petrodelta has not been provided with supporting documentation indicating the properties have been appropriately qualified by MENPET, the specific details for the exemption credit, such as which fields, production period or production, or the supporting calculations. Until MENPET either issues guidance on the exemption provisions in the law or issues payment forms including the exemption credit, or written approval from MENPET for this exemption credit is received by Petrodelta or us, we have and will continue to exclude the exemption credit from our equity earnings in Petrodelta.

• Sports Law Overaccrual: The Organic Law on Sports, Physical Activity and Physical Education (“Sports Law”) was published in the Official Gazette on August 24, 2011. The purpose of the Sports Law is to establish the public service nature of physical education and the promotion, organization and administration of sports and physical activity. Funding of the Sports Law is by contributions made by companies or other public or private organizations that perform economic activities for profit in Venezuela. The contribution is one percent of annual net or accounting profit and is not deductible for income tax purposes. Per the Sports Law, contributions are to be calculated on an after-tax basis. However, in March 2012, CVP has instructed Petrodelta to calculate the contribution on a before-tax basis contrary to the Sports Law. As of December 31, 2013, the cumulative amount of overstatement of the liability by following this calculation method is $1.3 million ($0.3 million net to our 20.4 percent interest as of December 31, 2013). We have adjusted for the overaccrual of the Sports Law in the results reported for net income from equity affiliate during the applicable periods, i.e., the years ended December 31, 2013 and 2012.

In addition to the adjustments to arrive at Petrodelta’s net income under U.S. GAAP, earnings from equity affiliate also reflect the amortization of the excess basis in equity affiliate using the unit-of-production method based on risk adjusted total current estimated reserves.

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All amounts through Net Income under U.S. GAAP represent 100 percent of Petrodelta. Summary financial information has been presented below at December 31, 2013 and 2012, and for the years ended December 31, 2013, 2012 and 2011:

	Year Ended December 31,
	2013			2012			2011
	(in thousands, except percentages)
Results under IFRS:
Revenues:
Oil sales	$	1,326,093		$	1,263,264		$	1,122,191
Gas sales		4,000			3,350			3,497
Royalty *		(440,963	)		(423,069	)		(374,135	)
		889,130			843,545			751,553
Expenses:
Operating expenses		151,661			121,023			77,236
Workovers		29,168			17,302			28,508
Depletion, depreciation and amortization		87,203			86,004			58,376
General and administrative		26,345			31,753			11,297
Windfall profits tax		234,453			291,355			237,632
Windfall profits credit		(55,168	)		0			0
		473,662			547,437			413,049
Income from operations		415,468			296,108			338,504
Gain on exchange rate		169,582			0			0
Investment earnings and other		15			13			610
Interest expense		(21,728	)		(7,017	)		(10,699	)
Income before income tax		563,337			289,104			328,415
Current income tax expense		325,217			127,080			190,577
Deferred income tax expense (benefit)		(17,662	)		76,030			(94,622	)
Net income under IFRS		255,782			85,994			232,460
Adjustments to increase (decrease) net income under IFRS:
Deferred income tax (expense) benefit		9,080			78,968			(49,545	)
Depletion expense		(20,352	)		7,282			1,908
Reversal of windfall profits tax credit		(55,168	)		0			0
Sports law over accrual		1,313			2,536			0
Net income under U.S. GAAP		190,655			174,780			184,823
Equity interest in equity affiliate		40	%		40	%		40	%
Income before amortization of excess basis in equity affiliate		76,262			69,912			73,929
Amortization of excess basis in equity affiliate		(3,684	)		(2,143	)		(1,863	)
Earnings from equity affiliate included in income	$	72,578		$	67,769		$	72,066

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* As discussed below, royalties paid-in-kind have been adjusted to reflect market prices as required under U.S. GAAP.

	As of December 31,
	2013		2012
	(in thousands)
Financial Position under IFRS:
Current assets	$	1,906,595	$	1,425,115
Property and equipment		717,449		538,351
Other assets		181,116		70,468
Current liabilities		1,652,806		1,180,559
Other liabilities		136,298		93,101
Net equity		1,016,056		760,274

Conversion Contract

On October 25, 2007, the Venezuelan Presidential Decree which formally transferred to Petrodelta the rights to the Petrodelta Fields subject to the conditions of the Conversion Contract was published in the Official Gazette. Petrodelta is governed by its own charter and bylaws and will engage in the exploration, production, gathering, transportation and storage of hydrocarbons from the Petrodelta Fields for a maximum of 20 years from that date. Petrodelta operates a portfolio of properties in eastern Venezuela including large proven oil fields as well as properties with substantial opportunities for both development and exploration. Petrodelta is to undertake its operations in accordance with Petrodelta’s business plan as set forth in its conversion contract. Under its conversion contract, work programs and annual budgets adopted by Petrodelta must be consistent with Petrodelta’s business plan. Petrodelta’s business plan may be modified by a favorable decision of the shareholders owning at least 75 percent of the shares of Petrodelta.

Sales Contract

The sale of oil and gas by Petrodelta to the Venezuelan government is pursuant to a Contract for Sale and Purchase of Hydrocarbons with PDVSA Petroleo S.A. (“PPSA”) signed on January 17, 2008. The form of the agreement is set forth in the Conversion Contract. Crude oil delivered from the Petrodelta Fields to PPSA is priced with reference to Merey 16 published prices, weighted for different markets, and adjusted for variations in gravity and sulphur content, commercialization costs and distortions that may occur given the reference price and prevailing market conditions. Merey 16 published prices are quoted and sold in U.S. Dollars. Natural gas delivered from the Petrodelta Fields to PPSA is priced at $1.54 per thousand cubic feet. Natural gas deliveries are paid in Bolivars, but the pricing for natural gas is referenced to the U.S. Dollar. PPSA is obligated to make payment to Petrodelta of each invoice within 60 days of the end of the invoiced production month by wire transfer, in U.S. Dollars in the case of payment for crude oil and natural gas liquids delivered, and in Bolivars in the case of payment for natural gas delivered, in immediately available funds to the bank accounts designated by Petrodelta.

When the Sales Contract was executed, Petrodelta was producing only one type of crude, Merey 16. Beginning in October 2011, the Ministry of the People’s Power for Petroleum and Mining (“MENPET”) determined that Petrodelta’s production flowing through the COMOR transfer point was a heavier type of crude, Boscan. Since Petrodelta was producing only Merey 16 when the Sales Contract was executed, the Boscan gravity and sulphur correction factors and crude pricing formula are not included in the Sales Contract. However, under the Sales Contract, PPSA is obligated to receive all of Petrodelta’s production. All production deliveries for all of Petrodelta’s fields have been certified by MENPET and acknowledged by PPSA. All pricing factors to be used in the Merey 16 and Boscan pricing formulas have been provided by and certified by MENPET to Petrodelta.

Since the Sales Contract provides for only one crude pricing formula, the Sales Contract had to be amended to include the Boscan pricing formula to allow Petrodelta to invoice PPSA for El Salto crude oil deliveries.

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Petrodelta received a draft amendment to the Sales Contract from PDVSA Trade and Supply. The pricing formula in the draft amendment has been used to accrue revenue for El Salto field deliveries from October 1, 2011 through December 31, 2013. Except for the inclusion of the Boscan pricing formula to be used in invoicing El Salto crude oil deliveries, all other terms and conditions of the Sales Contract remain in force. On January 31, 2013, Petrodelta’s board of directors endorsed the amendment to the Sales Contract. The amendment has been approved by CVP’s board of directors. HNR Finance, as shareholder, has agreed to the contract amendment.

CVP’s board of directors reviewed the amendment on April 30, 2013. A certificate of CVP’s final board resolution approving the amendment dated April 30, 2013 was received by Petrodelta on May 23, 2013. The remaining steps for the contract amendment are to (1) inform MENPET of the approval, (2) receive approval from Petrodelta’s shareholders to amend the Sales Contract including the Boscan formula, and (3) sign the contract amendment with PDVSA Trade and Supply. Once the Sales Contract is executed, PPSA will be invoiced for the deliveries. As of December 31, 2013, revenues of $756.7 million ($352.7 million as of December 31, 2012) for El Salto remain uninvoiced to PPSA pending execution of the amendment.

Payments to Contractors

As discussed in previous filings, PDVSA has failed to pay on a timely basis certain amounts owed to contractors that PDVSA has contracted to do work for Petrodelta. PDVSA, through PPSA, purchases all of Petrodelta’s oil production. PDVSA and its affiliates have reported shortfalls in meeting their cash requirements for operations and planned capital expenditures, and PDVSA has fallen behind in certain of its payment obligations to its contractors, including contractors engaged by PDVSA to provide services to Petrodelta. In addition, PDVSA has fallen behind in certain of its payment obligations to Petrodelta, which payments Petrodelta would otherwise use to pay its contractors, including Harvest Vinccler. As a result, Petrodelta has experienced, and is continuing to experience, difficulty in retaining contractors who provide services for Petrodelta’s operations. We cannot provide any assurance as to whether or when PDVSA will become current on its payment obligations. Inability to retain contractors or to pay them on a timely basis is having an adverse effect on Petrodelta’s operations and on Petrodelta’s ability to carry out its business plan.

Harvest Vinccler has advanced certain costs on behalf of Petrodelta. These costs include consultants in engineering, drilling, operations, seismic interpretation, and employee salaries and related benefits for Harvest Vinccler employees seconded into Petrodelta. Currently, we have three employees seconded into Petrodelta. Costs advanced are invoiced on a monthly basis to Petrodelta. Harvest Vinccler is considered a contractor to Petrodelta,and as such, Harvest Vinccler is also experiencing the slow payment of invoices. During the year ended December 31, 2013, Harvest Vinccler advanced to Petrodelta $0.5 million for continuing operations costs. Petrodelta and Petrodelta’s board have not indicated that the advances are not payable, nor that they will not be paid. At December 31, 2013, we reclassified $0.8 million of the Advances to Affiliate to a long-term receivable due to slow payment and age of the advances. Although payment is slow and the balance is increasing, payments continue to be received.

Windfall Profits Tax

In April 2011, the Venezuelan government published in the Official Gazette the Law Creating a Special Contribution on Extraordinary Prices and Exorbitant Prices in the International Hydrocarbons Market (“Windfall Profits Tax”). In February 2013, the Venezuelan government published in the Official Gazette an amendment to the Windfall Profits Tax. The amended Windfall Profits Tax establishes new levels for contribution of extraordinary and exorbitant prices to the Venezuelan government. Extraordinary prices are considered to be equal to or lower than $80 per barrel, and exorbitant prices are considered to be over $80 per barrel.

Royalty Cap

Royalties are paid at 33.33 percent with the 30 percent royalty paid in kind and the 3.33 percent royalty paid in cash. The amended Windfall Profits Tax also sets a new royalty cap per barrel of $80 ($70 per barrel in 2012). The law does not specify whether the cap on royalties is applicable to royalties paid in-cash, in-kind, or both. Per

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instructions received from PDVSA, Petrodelta reports royalties, whether paid in-cash or in-kind, at $80 per barrel (royalty barrels x $80). Per our interpretation of the Windfall Profits Tax law and as required under U.S. GAAP, the $80 cap on royalty barrels should only be applied to the 3.33 percent royalty which Petrodelta pays in cash. The revenues and royalties in the table above have been adjusted to report royalties paid in-kind at the oil price applicable for the period. For the year ended December 31, 2013, the reduction to oil sales due to the $80 cap applied to all royalty barrels was $38.4 million ($12.1 million net to our percent interest for the period) ($113.7 million [$36.4 million net to our 32 percent interest] and $85.0 million [$27.2 million net to our 32 percent interest] for the years ended December 31, 2012 and 2011, respectively). While both methods of reporting result in the same amount being reported for net sales, our method results in prices per barrel of oil which are consistent with the prices expected under the Sales Contract.

Functional Currency

Petrodelta’s functional and reporting currency is the U.S. Dollar. PPSA is obligated to make payment to Petrodelta in U.S. Dollars in the case of payment for crude oil and natural gas liquids delivered. In addition, major contracts for capital expenditures and lease operating expenditures are denominated in U.S. Dollars. Any dividend paid by Petrodelta will be made in U.S. Dollars.

Petrodelta has currency exchange risk from fluctuations of the official prevailing exchange rate that applies to their operating costs denominated in Venezuela Bolivars (“Bolivars”). The monetary assets that are exposed to exchange rate fluctuations are cash, accounts receivable, prepaid expenses and other current assets. The monetary liabilities that are exposed to exchange rate fluctuations are accounts payable, accruals, current and deferred income tax and other tax obligations and other current liabilities. All monetary assets and liabilities incurred at the official Bolivar exchange rate are settled at the official Bolivar exchange rate. The official prevailing currency exchange rate was increased from 4.3 Bolivars per U.S. Dollar to 6.3 Bolivars per U.S. Dollar in February 2013. Petrodelta reflected a gain of approximately $169.6 million on revaluation of its non-income tax related assets and liabilities during the year ended December 31, 2013 primarily related to the February 2013 devaluation.

As a result of legislation enacted in December 2013 and January and February of 2014, Venezuela now has a multiple exchange rate system. Most of Petrodelta’s transactions are subject to a fixed official exchange rate of 6.3. In addition, there is a variable official exchange rate system in which the exchange rate is determined through auctions (11.3 rate as of December 31, 2013). The third system is not yet available as the government has not yet specified the scope of application and mechanics. The financial information is prepared using the official fixed exchange rate (6.3 from February 2013 through December 2013). At December 31, 2013, the balances in Petrodelta’s Bolivar denominated monetary assets and liabilities accounts that are exposed to exchange rate changes are 1,011 million Bolivars and 6,683 million Bolivars, respectively.

Petrodelta’s results were also impacted by PDVSA changing its policy with respect to invoicing for disbursements made in Bolivars on behalf of Petrodelta to require that such invoices be denominated in U.S. dollars rather than Bolivars. This change was implemented in the fourth quarter of 2013 with retroactive application to certain transactions occurring in 2011 and thereafter. As a result of this change, Petrodelta recorded a $14.2 million foreign currency loss in the three months ended December 31, 2013.

Collective Labor Agreement

On February 11, 2014, the Collective Labor Agreement for the period from October 1, 2013 thru October 1, 2015, between the employees of the oil industry represented by the Venezuelan Unitary Federation of workers of the oil, gas, and derivatives (FUTPV) and PDVSA was signed. The Collective Labor Agreement establishes a salary raise and payroll and retirement benefits which has a significant impact on Petrodelta’s payroll cost. The most significant impact is a step increase of salary around 90%, where 59% is to be retroactive from October 1, 2013, then a 23% raise from May 1, 2014 and finally the remaining portion to be adjusted on January 1, 2015.

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Dividends

On November 12, 2010, Petrodelta’s board of directors declared a dividend of $30.6 million, $12.2 million net to HNR Finance. Petrodelta shareholder approval of the dividend was received on March 14, 2011. Due to Petrodelta’s liquidity constraints caused by PDVSA’s insufficient monetary support and contractual adherence, as of May 2, 2012, this dividend has not been received, although it is due and payable. Petrodelta’s board of directors declared this dividend and has never indicated that the dividend is not payable, nor that it will not be paid. The dividend receivable is classified as a long-term receivable at December 31, 2013 and 2012 due to the uncertainty in the timing of payment. There is uncertainty with respect to the timing of the receipt of this dividend and whether future dividends will be declared and/or paid. During the term of the Share Purchase Agreement, Harvest Holding may not pay any dividends to HNR Energia, and therefore would not benefit from any dividends paid by Petrodelta during this period. Should this receivable be paid and subsequently distributed to Harvest Holding’s shareholders prior to the second closing sale to Petroandina, we would not receive any portion of the dividend.

Fusion Geophysical, LLC (“Fusion”)

On January 28, 2011, Fusion Geophysical, LLC’s (“Fusion”) 69 percent owned subsidiary, FusionGeo, Inc., was acquired by a private purchaser pursuant to an Agreement and Plan of Merger. We received $1.4 million for our equity investment.

Note 7 – Venezuela – Other

See also Note 6 – Investment in Equity Affiliates, Venezuela – Petrodelta, S.A. for further information regarding our Venezuela operations.

Harvest Vinccler’s functional and reporting currency is the U.S. Dollar. They do not have currency exchange risk other than the official prevailing exchange rate that applies to their operating costs denominated in Venezuela Bolivars (“Bolivars”). During the year ended December 31, 2013, Harvest Vinccler exchanged approximately $1.6 million ($1.5 million during the year ended December 31, 2012) and received an average exchange rate of 6.9 Bolivars (5.16 Bolivars during the year ended December 31, 2012) per U.S. Dollar.

The monetary assets that are exposed to exchange rate fluctuations are cash, accounts receivable, prepaid expenses and other current assets. The monetary liabilities that are exposed to exchange rate fluctuations are accounts payable, accruals, current and deferred income tax and other tax obligations and other current liabilities. All monetary assets and liabilities incurred at the official Bolivar exchange rate are settled at the official Bolivar exchange rate. At December 31, 2013, the balances in Harvest Vinccler’s Bolivar denominated monetary assets and liabilities accounts that are exposed to exchange rate changes are 10.2 million Bolivars and 7.2 million Bolivars, respectively. Therefore a change in the exchange rate is not expected to have a material impact on results of operations or our financial position.

Note 8 – Gabon

We are the operator of the Dussafu PSC with a 66.667 percent ownership interest. Located offshore Gabon, adjacent to the border with the Republic of Congo, the Dussafu PSC covers an area of 680,000 acres with water depths up to 1,650 feet.

The Dussafu PSC partners and the Republic of Gabon, represented by the Ministry of Mines, Energy, Petroleum and Hydraulic Resources, entered into the third exploration phase of the Dussafu PSC with an effective date of May 28, 2012. The Direction Generale Des Hydrocarbures (“DGH”) agreed to lengthen the third exploration phase to four years until May 27, 2016.

During 2011, we drilled our first exploratory well, Dussafu Ruche Marin-1 (“DRM-1”), and two appraisal sidetracks. DRM-1 and sidetracks discovered oil of approximately 149 feet of pay within the Gamba and Middle

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Dentale Formations. DRM-1 and sidetracks are currently suspended pending further exploration and development activities. Operational activities during 2012 included completion of the time processing of 545 square kilometers of seismic, which was acquired in the fourth quarter of 2011, and well planning.

Well planning progressed during 2012 to drill an exploration well in the fourth quarter of 2012 on the Tortue prospect. DTM-1 well was spud November 19, 2012. DTM-1 was drilled with the Scarabeo 3 semi-submersible drilling unit. On January 4, 2013, we announced that DTM-1 had reached the Dental Formation and discovered oil in both the Gamba and Dentale formations. The first appraisal sidetrack of DTM-1 (“DTM-1ST1”) was spud in January 12, 2013 and drilled to a total depth of 11,385 feet in the Dentale Formation and found 65 feet of pay in the primary Dentale reservoir. Work on DTM-1 and DTM-1ST1 was suspended pending future appraisal and development activities.

Geoscience, reservoir engineering and economic studies have progressed and a field development plan is being prepared for a cluster field development of both the Ruche and Tortue discoveries along with existing pre-salt discoveries at Walt Whitman and Moubenga. Planning and contracting for a 3D seismic acquisition survey over the outer half of the license took place. Acquisition of a 1,260 square kilometer survey commenced in October 2013, and the first high quality seismic products are expected to be available during the second quarter of 2014. The new 3D seismic data should also enhance the placement of future development wells in the Ruche and Tortue development program.

See Note 13 – Commitments and Contingencies for a discussion of legal matters related to our Gabon operations.

The Dussafu PSC represents $103.4 million of unproved oil and gas properties including inventory on our December 31, 2013 balance sheet ($76.4 million at December 31, 2012).

Note 9 – Indonesia

In 2007, we entered into a Farmout Agreement to acquire a 47 percent interest in the Budong PSC located mostly onshore West Sulawesi, Indonesia. In April 2008, the Government of Indonesia approved the assignment to us of the 47 percent interest in the Budong PSC. Our partner is the operator through the exploration phase as required by the terms of the Budong PSC, and we have an option to become operator, if approved by the Government of Indonesia and SKK Migas in any subsequent development and production phase.

We acquired our original 47 percent interest in the Budong PSC by committing to fund the first phase of the exploration program up to a cap of $17.2 million, including the acquisition of 2-D seismic and drilling of the first two exploration wells under a Farmout Agreement with our partner in the Budong PSC. Prior to drilling the first exploration well, our partner had a one-time option to increase the level of the carried interest to a maximum of $20.0 million. On September 15, 2010, our partner exercised their option to increase the carry obligation by $2.7 million to a total of $19.9 million. The additional carry increased our ownership by 7.4 percent to 54.4 percent. On March 3, 2011, the Government of Indonesia approved this change in ownership interest.

On January 14, 2011, we exercised our first refusal right to a proposed transfer of interest by the operator to a third party, which allowed us to acquire an additional 10 percent ownership in the Budong PSC at a cost of $3.7 million payable ten business days after completion of the first exploration well. The $3.7 million was paid on April 18, 2011. Closing of this acquisition increased our participating ownership interest in the Budong PSC to 64.4 percent with our cost sharing interest becoming 64.51 percent until first commercial production. On August 11, 2011, the Government of Indonesia approved this change in ownership interest.

The initial exploration term of the Budong PSC was due to expire on January 15, 2013. In September 2012, the operator of the Budong PSC, on behalf of us and the other co-venturer, submitted a request to BPMIGAS under the terms of the Budong PSC for a four-year extension of the initial six-year exploration term of the Budong PSC. In January 2013, we received written approval from SKK Migas of the four-year extension of the initial six-year exploration term.

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In November 2012, the Indonesia constitutional court declared BPMIGAS, Indonesia’s oil and gas regulatory authority, to be unconstitutional. In January 2013, SKK Migas, the Special Task Force for oil and gas upstream sector, was formed to replace BPMIGAS.

In December 2012, we signed a farmout agreement with the operator of the Budong PSC to acquire an additional 7.1 percent participating interest and to become operator of the Budong PSC. We assumed the role of operator effective March 25, 2013. Closing of this acquisition on April 22, 2013 increased our participating ownership interest in the Budong PSC to 71.5 percent with our cost sharing interest becoming 72 percent until first commercial production. The consideration for this transaction is that we will fund 100 percent of the costs of the first exploration well of the four-year extension to the Budong PSC. If the exploration well is not drilled by October 2014 (within 18 months of the date of approval from the Government of Indonesia of this transaction), our partner has the right to give us notice that the consideration for the additional 7.1 percent participating interest must be paid in cash for $3.2 million.

We have satisfied all work commitments for the current exploration phase of the Budong PSC. However, the extension of the initial exploration term includes an exploration well, which if not drilled by January 2016, results in the termination of the Budong PSC.

During the initial exploration period, the Budong PSC covered 1.35 million acres. The Budong PSC includes a ten-year exploration period and a 20-year development phase. Pursuant to the terms of the Budong PSC, at the end of the first three-year exploration phase, 45 percent of the original area was to be relinquished to SKK Migas. In January 2010, 35 percent of the original area was relinquished and ten percent of the required relinquishment was deferred until 2011. In January 2011, the deferred ten percent of the original total contract area was relinquished to SKK Migas. The Budong PSC currently covers 0.75 million acres. However, pursuant to the request for extension of the initial exploration term, the contract area held by the Budong PSC at the beginning of the extension period should be reduced, per the terms of the Budong PSC, from the current 55 percent to 20 percent of the original contract area. If the full amount of the required relinquishment is required, 0.3 million acres would remain in the Budong PSC contract area. In January 2013, our partner, on our behalf, submitted a relinquishment proposal of 10 percent to SKK Migas. The retained area will contain all the areas of geological interest to the Budong PSC partners.

Operational activities during 2012 focused on a review of geological and geophysical data obtained from the drilling of LG-1 and KD-1 wells to upgrade the prospectivity of the block and to define a prospect for potential drilling in 2013. We have completed remapping of both the Lariang and Karama Basins with eight leads in the Lariang Basin and five leads in the Karama Basin having been identified. The identification of these leads is the basis for the four-year extension request of the first six-year exploration term.

Operational activities during 2013 included continued work on an exploration program targeting the Pliocene and Miocene targets encountered in the previous two wells. Land access and acquisition; environmental studies; construction and upgrades to access roads, bridges, and well site; permitting; and tender prequalification and procurement are on-going.

We are actively discussing the sale of our interests in Budong, and based on indications of interest received in December 2013, we determined that is it was appropriate to recognize an impairment expense of $0.6 million and a charge included in general and administrative expenses related to a valuation allowance on VAT we do not expect to recover of $2.8 million. The Budong PSC represents $4.6 million of unproved oil and gas properties including inventory on our December 31, 2013 balance sheet ($5.3 million at December 31, 2012).

Note 10 – China

In December 1996, we acquired a petroleum contract with China National Offshore Oil Corporation (“CNOOC”) for the WAB-21 area. The WAB-21 petroleum contract covers 6.2 million acres in the South China Sea, with an option for an additional 1.25 million acres under certain circumstances, and lies within an area which is the subject of a border dispute between China and Socialist Republic of Vietnam (“Vietnam”). Vietnam

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has executed an agreement on a portion of the same offshore acreage with another company. The border dispute has lasted for many years, and there has been limited exploration and no development activity in the WAB-21 area due to the dispute. Due to the border dispute between China and Vietnam, we have been unable to pursue an exploration program during Phase One of the contract. As a result, we have obtained license extensions, with the current extension in effect until May 31, 2013. The Joint Management Committee has approved an extension of the license until May 31, 2015. We are meeting with CNOOC in April 2013 to discuss the ratification of the extension. Regular meetings are held with CNOOC with contingent work programs being planned and annual budgets being set. While no assurance can be given, we believe we will continue to receive contract extensions so long as the border disputes persist. Even though there continues to be increasing activity on the Vietnamese blocks which we believe confirms our view of WAB-21’s prospectivity, we impaired the carrying value of WAB-21 of $2.9 million during the year ended December 31, 2012 due to our continued inability to pursue an exploration program. However, we continue to seek permission to acquire regional 2-D seismic and localized 3-D seismic.

Note 11 – Debt

Debt consists of the following (in thousands):

	As of December 31,
	2013			2012
Senior notes, unsecured, with interest at 11%	$	79,750		$	79,750
Discount on 11% senior unsecured notes		(2,270	)		(4,911	)
Less current portion		(77,480	)		0
	$	0		$	74,839

On October 11, 2012, we closed the sale of $79.8 million aggregate principal amount of 11 percent senior unsecured notes due October 11, 2014. Under the terms of the notes, interest is payable quarterly in arrears on January 1, April 1, July 1 and October 1, beginning January 1, 2013. The 11 percent senior unsecured notes are general unsecured obligations, ranking equally in right of payment with all our future senior unsecured indebtedness. The senior unsecured notes are structurally subordinated to indebtedness and other liabilities of our subsidiaries.

The 11 percent senior unsecured notes were issued at a price of 96 percent of principal amount. The original issue discount (“OID”) is recorded as a Discount on Debt. Warrants to purchase up to 0.8 million shares of our common stock with an exercise price of $10.00 per share were issued in connection with the 11 percent senior unsecured notes. The fair value of the warrants is recorded as Discount on Debt. The OID and Discount on Debt are being amortized over the life of the debt.

Financing costs associated with the 11 percent senior unsecured notes are recorded in other assets and are amortized over the life of the notes. The balance for financing costs, substantially all of which relates to the 11 percent senior unsecured notes, was $1.3 million at December 31, 2013 ($3.2 million at December 31, 2012).

As discussed in Note 2 – Liquidity, we used a portion of the $125 million in proceeds from the sale of the 29 percent interest in Harvest Holding that we received on December 16, 2013, to redeem all of our 11% Senior Notes due 2014. The notes were redeemed on January 11, 2014, for $80.0 million, including principal and accrued and unpaid interest. As a result of the redemption, we will record a loss on extinguishment of debt of approximately $3.6 million during the three months ended March 31, 2014. This loss is primarily includes the write off of the discount on debt ($2.3 million) and the expensing of financing costs related to the term loan facility ($1.3 million).

In the event that a sale of assets (farm-outs are not included in the definition of a sale of assets in the indenture) for more than $5.0 million in the aggregate occurs, within 30 days of such event, we are required to make an offer to all noteholders of our 11 percent senior unsecured notes to purchase the maximum principal

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amount of our 11 percent senior unsecured notes that may be purchased out of the sales proceeds at an offer price in cash in an amount equal to 105.5 percent of the principal amount plus accrued and unpaid interest, if any. In the event of a change in control or a sale of Petrodelta, the noteholders of our 11 percent senior unsecured notes have the right to require us to repurchase all or any part of the 11 percent senior unsecured notes at a repurchase price equal to 101 percent in the case of a change in control or 105.5 percent in the case of a sale of Petrodelta plus accrued interest.

As of December 31, 2012, we assessed the prepayment requirements and concluded that this feature met the criteria to be considered an embedded derivative. We considered the probabilities of these events occurring and determined that the derivative had a value of $0 million at December 31, 2012. Due to the notice of redemption issued on December 11, 2013 prior to a sale of assets, change in control or sale of Petrodelta, we determined that this feature was not an embedded derivative at December 31, 2013.

On February 17, 2010, we closed an offering of $32.0 million in aggregate principal amount of our 8.25 percent senior convertible notes. Under the terms of the notes, interest was payable semi-annually in arrears on March 1 and September 1 of each year, beginning September 1, 2010. The senior convertible notes matured on March 1, 2013 unless earlier redeemed, repurchased or converted. The notes were convertible into shares of our common stock at a conversion rate of 175.2234 shares of common stock per $1,000 principal amount of senior convertible notes, equivalent to a conversion price of approximately $5.71 per share of common stock. The 8.25 percent senior convertible notes were general unsecured obligations, ranking equally with all of our other unsecured senior indebtedness, if any, and senior in right of payment to any of our subordinated indebtedness, if any.

Non-cash payment of debt during the year ended December 31, 2011 was $0.5 million of senior convertible notes converted into 0.1 million share of common stock at a conversion rate of $5.71 per share. Non-cash payment of debt during the year ended December 31, 2012 was $25.5 million of the senior convertible notes exchanged for 4.6 million shares of common stock at an effective exchange price of $5.59 per share. The difference between the exchange price and the market price on the date of the transaction is recorded as debt conversion expense on our consolidated statements of operations and comprehensive income (loss). The remaining balance of the senior convertible notes, $6.0 million, was repaid by way of a non-cash exchange for approximately $10.5 million of the 11 percent senior unsecured notes, the value of which was agreed to by us and the noteholder that the noteholder would have otherwise attained had the noteholder converted the note into shares of common stock. The difference between the value of the senior convertible notes exchanged and the senior unsecured notes received is recorded as a loss on extinguishment of debt on our consolidated statements of operations and comprehensive income (loss).

Financing costs associated with the 8.25 percent senior convertible notes were amortized over the life of the notes and were recorded in other assets. In connection with the exchange of convertible notes into our common stock, we reclassified $0.6 million of deferred financing costs to additional paid in capital. Financing costs for the convertible notes were fully amortized or reclassified at December 31, 2012 ($1.0 million at December 31, 2011).

On October 29, 2010, we closed a $60.0 million term loan facility with MSD Energy Investments Private II, LLC (“MSD Energy”), an affiliate of MSD Capital, L.P., as the sole lender under the term loan facility. Under the terms of the term loan facility, interest was paid on a monthly basis at the initial rate of 10 percent and had a maturity of October 28, 2012. The initial rate of interest was scheduled to increase to 15 percent on July 28, 2011, the Bridge Date. Financing costs associated with the term loan facility were being amortized over the remaining life of the loan and were recorded in other assets. See Note 15 – Stock-Based Compensation and Stock Purchase Plans – Common Stock Warrants for a discussion of the warrants that were issued in connection with the $60.0 million term loan facility.

In May 2011, we prepaid our $60 million term loan facility. The early repayment resulted in a loss on extinguishment of debt of $13.1 million. The loss on extinguishment of debt includes the write off of

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the discount on debt ($10.6 million), a prepayment premium of 3.5 percent of the amount outstanding ($2.1 million), and expensing of financing costs related to the term loan facility ($0.4 million).

The principal payment requirements for our debt outstanding at December 31, 2013 are as follows (in thousands):

2014	$	79,750
	$	79,750

Note 12 – Warrant Derivative Liabilities

The Warrants, which have anti-dilution protection features, do not meet the conditions to obtain equity classification under ASC 480 “Distinguishing Liabilities From Equity” as there are conditions which may require settlement by transferring assets. These Warrants are required to be carried as derivative liabilities, at fair value, with current changes in fair value reflected in our consolidated statements of operations and comprehensive income. As of December 31, 2013, the Warrants consisted of 1,826,001 warrants (1,720,334 at December 31, 2012) issued under the warrant agreements dated November 2010 in connection with a $60 million term loan facility. The fair value of the Warrants as of December 31, 2013 was $1.07 per warrant ($3.18 per warrant at December 31, 2012).

In the occurrence of a fundamental change, we are required to repurchase the Warrants at the higher of (1) the fair market value of the warrant and (2) a valuation based on a computation of the option value of the Warrant using the Black-Scholes calculation method using the assumptions described in the warrant agreement. A fundamental change is defined as the occurrence of one of the following events: a) a person or group becomes the direct or indirect owner of more than 50 percent of the voting power of the outstanding common stock, b) a merger event or similar transaction in which the majority owners before the transaction fail to own a majority of the voting power of the Company after the transaction, and c) approval of a plan of liquidation or dissolution of the Company or sale of all or substantially all of the Company’s assets.

Estimating fair values of derivative financial instruments requires the development of significant and subjective estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques (such the Monte Carlo model) are highly volatile and sensitive to changes in the trading market price of our common stock. Since derivative financial instruments are initially and subsequently carried at fair value, our income will reflect the volatility in these estimate and assumption changes.

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The Monte Carlo model is used on the Warrants to reasonably value the potential future exercise price adjustments triggered by the anti-dilution provisions. This requires Level 3 inputs (see Note 3 – Summary of Significant Accounting Policies, Financial Instruments and Fair Value Measurements) which are based on our estimates of the probability and timing of potential future financings and fundamental transactions. The assumptions summarized in the following table were used to calculate the fair value of the warrant derivative liability that was outstanding as of any of the balance sheet dates presented on our consolidated balance sheets:

	Fair Value Hierarchy Level
			As of December 31,
			2013			2012
Significant assumptions (or ranges):
Stock price		Level 1 input	$	4.52		$	9.07
Term (years)				1.83			2.83
Volatility		Level 2 input		94	%		70	%
Risk-free rate		Level 1 input		0.34	%		0.33	%
Dividend yield		Level 2 input		0.0	%		0.0	%
Scenario probability (fundamental change event/debt raise/equity raise)		Level 3 input		60%/40%/0	%		0%/80%/20	%

Inherent in the Monte Carlo valuation model are assumptions related to expected stock price volatility, expected life, risk-free interest rate and dividend yield. As part of our overall valuation process, management employs processes to evaluate and validate the methodologies, techniques and inputs, including review and approval of valuation judgments, methods, models, process controls, and results. These processes are designed to help ensure that the fair value measurements and disclosures are appropriate, consistently applied, and reliable. We estimate the volatility of our common stock based on historical volatility that matches the expected remaining life of the warrants. The risk-free interest rate is based on the U.S. Treasury yield curve as of the valuation dates for a maturity similar to the expected remaining life of the warrants. The expected life of the warrants is assumed to be equivalent to their remaining contractual term. The dividend rate is based on the historical rate, which we anticipate to remain at zero.

All our warrant derivative contracts are recorded at fair value and are classified as warrant derivative liability on the consolidated balance sheet. The following table summarizes the effect on our income (loss) associated with changes in the fair values of our warrant derivative financial instruments:

	Year Ended December 31,
	2013		2012
	(in thousands)
Unrealized gain (loss) on warrant derivatives	$	3,517	$	(600	)

Note 13 – Commitments and Contingencies

We have employment contracts with five executive officers which provide for annual base salaries, eligibility for bonus compensation and various benefits. The contracts provide for a lump sum payment as a multiple of base salary in the event of termination of employment without cause. In addition, these contracts provide for payments as a multiple of base salary and bonus, excise tax reimbursement, outplacement services and a continuation of benefits in the event of termination without cause following a change in control. By providing one year notice, these agreements may be terminated by either party on or after May 31, 2013.

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We have regional/technical offices in Singapore and field offices in Jakarta, Indonesia and Port Gentil, Gabon to support field operations in those areas. At December 31, 2013 we had the following lease commitments for office space (in thousands):

	Payments Due by Period
	Total		Less than 1 Year		1-2 Years		3-4 Years		After 4 Years
Office leases	$	583	$	521	$	62	$	0	$	0

We have various contractual commitments pertaining to exploration, development and production activities. We entered the third exploration phase of the Dussafu PSC on May 28, 2012. In January 2013, the Budong PSC partners were granted a four year extension of the initial six year exploration term of the Budong PSC to January 15, 2017. The extension of the initial exploration term includes an exploration well, which if not drilled by January 2016, results in the termination of the Budong PSC. If we do not drill an exploration well before October 2014, our partner has the right to give us notice that the consideration for the additional 7.1 percent participating interest must be paid in cash for $3.2 million. See Note 9 – Indonesia. These work commitments are non-discretionary; however, we do have the ability to control the pace of expenditures.

Kensho Sone, et al. v. Harvest Natural Resources, Inc., in the United States District Court, Southern District of Texas, Houston Division. On July 24, 2013, 70 individuals, all alleged to be citizens of Taiwan, filed an original complaint and application for injunctive relief relating to the Company’s interest in the WAB-21 area of the South China Sea. The complaint alleges that the area belongs to the people of Taiwan and seeks damages in excess of $2.9 million and preliminary and permanent injunctions to prevent the Company from exploring, developing plans to extract hydrocarbons from, conducting future operations in, and extracting hydrocarbons from, the WAB-21 area. The Company has filed a motion to dismiss and intends to vigorously defend these allegations.

The following related class action lawsuits were filed on the dates specified in the United States District Court, Southern District of Texas: John Phillips v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (March 22, 2013) (“Phillips case”); Sang Kim v. Harvest Natural Resources, Inc., James A. Edmiston, Stephen C. Haynes, Stephen D. Chesebro’, Igor Effimoff, H. H. Hardee, Robert E. Irelan, Patrick M. Murray and J. Michael Stinson (April 3, 2013); Chris Kean v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (April 11, 2013); Prastitis v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (April 17, 2013); Alan Myers v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (April 22, 2013); and Edward W. Walbridge and the Edward W. Walbridge Trust v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (April 26, 2013). The complaints allege that the Company made certain false or misleading public statements and demand that the defendants pay unspecified damages to the class action plaintiffs based on stock price declines. All of these actions have been consolidated into the Phillips case. The Company and the other named defendants have filed a motion to dismiss and intend to vigorously defend the consolidated lawsuits.

In June 2012, the operator of the Budong PSC received notice of a claim related to the ownership of part of the land comprising the Karama-1 (“KD-1”) drilling site. The claim asserts that the land on which the drill site is located is partly owned by the claimant. The operator purchased the site from local landowners in January 2010, and the purchase was approved by BPMIGAS, Indonesia’s oil and gas regulatory authority. The claimant is seeking compensation of 16 billion Indonesia Rupiah (approximately $1.4 million, $1.0 million net to our 71.61 percent cost sharing interest) for land that was purchased at a cost of $4,100 in January 2010. On March 8, 2013, the court ruled to dismiss the claim because the claim had not been filed against the proper parties to the claim. On March 19, 2013, the claimant filed an appeal against the judgment. We dispute the claim and plan to vigorously defend against it.

In May 2012, Newfield Production Company (“Newfield”) filed notice pursuant to the Purchase and Sale Agreement between Harvest (US) Holdings, Inc. (“Harvest US”), a wholly owned subsidiary of Harvest, and

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Newfield dated March 21, 2011 (the “PSA”) of a potential environmental claim involving certain wells drilled on the Antelope Project. The claim asserts that locations constructed by Harvest US were built on, within, or otherwise impact or potentially impact wetlands and other water bodies. The notice asserts that, to the extent of potential penalties or other obligations that might result from potential violations, Harvest US must indemnify Newfield pursuant to the PSA. In June 2012, we provided Newfield with notice pursuant to the PSA (1) denying that Newfield has any right to indemnification from us, (2) alleging that any potential environmental claim related to Newfield’s notice would be an assumed liability under the PSA and (3) asserting that Newfield indemnify us pursuant to the PSA. We dispute Newfield’s claims and plan to vigorously defend against them.

On May 31, 2011, the United Kingdom branch of our subsidiary, Harvest Natural Resources, Inc. (UK), initiated a wire transfer of approximately $1.1 million ($0.7 million net to our 66.667 percent interest) intending to pay Libya Oil Gabon S.A. (“LOGSA”) for fuel that LOGSA supplied to our subsidiary in the Netherlands, Harvest Dussafu, B.V., for the company’s drilling operations in Gabon. On June 1, 2011, our bank notified us that it had been required to block the payment in accordance with the U.S. sanctions against Libya as set forth in Executive Order 13566 of February 25, 2011, and administered by OFAC, because the payee, LOGSA, may be a blocked party under the sanctions. The bank further advised us that it could not release the funds to the payee or return the funds to us unless we obtain authorization from OFAC. On October 26, 2011, we filed an application with OFAC for return of the blocked funds to us. Until that application is approved, the funds will remain in the blocked account, and we can give no assurance when OFAC will permit the funds to be released. Our October 26, 2011 application for the return of the blocked funds remains pending with OFAC.

Robert C. Bonnet and Bobby Bonnet Land Services vs. Harvest (US) Holdings, Inc., Branta Exploration & Production, LLC, Ute Energy LLC, Cameron Cuch, Paula Black, Johnna Blackhair, and Elton Blackhair in the United States District Court for the District of Utah. This suit was served in April 2010 on Harvest and Elton Blackhair, a Harvest employee, alleging that the defendants, among other things, intentionally interfered with plaintiffs’ employment agreement with the Ute Indian Tribe – Energy & Minerals Department and intentionally interfered with plaintiffs’ prospective economic relationships. Plaintiffs seek actual damages, punitive damages, costs and attorney’s fees. We dispute plaintiffs’ claims and plan to vigorously defend against them. On October 29, 2013, we learned that the court administratively closed the case. The case was recently reopened as a result of the Circuit Court of Appeals’ ruling against Plaintiffs’ discovery request. We dispute Plaintiffs’ claims and plan to vigorously defend against them.

Uracoa Municipality Tax Assessments. Harvest Vinccler S.C.A., a subsidiary of Harvest Holding (“Harvest Vinccler”), has received nine assessments from a tax inspector for the Uracoa municipality in which part of the Uracoa, Tucupita and Bombal fields are located as follows:

• Three claims were filed in July 2004 and allege a failure to withhold for technical service payments and a failure to pay taxes on the capital fee reimbursement and related interest paid by PDVSA under the Operating Service Agreement (“OSA”). Harvest Vinccler has filed a motion with the Tax Court in Barcelona, Venezuela, to enjoin and dismiss one of the claims and has protested with the municipality the remaining claims.

• Two claims were filed in July 2006 alleging the failure to pay taxes at a new rate set by the municipality. Harvest Vinccler has filed a protest with the Tax Court in Barcelona, Venezuela, on these claims.

• Two claims were filed in August 2006 alleging a failure to pay taxes on estimated revenues for the second quarter of 2006 and a withholding error with respect to certain vendor payments. Harvest Holding has filed a protest with the Tax Court in Barcelona, Venezuela, on one claim and filed a protest with the municipality on the other claim.

• Two claims were filed in March 2007 alleging a failure to pay taxes on estimated revenues for the third and fourth quarters of 2006. Harvest Vinccler has filed a protest with the municipality on these claims.

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Harvest Vinccler disputes the Uracoa tax assessments and believes it has a substantial basis for its positions based on the interpretation of the tax code by SENIAT (the Venezuelan income tax authority), as it applies to operating service agreements, Harvest Holding has filed claims in the Tax Court in Caracas against the Uracoa Municipality for the refund of all municipal taxes paid since 1997.

Libertador Municipality Tax Assessments. Harvest Vinccler has received five assessments from a tax inspector for the Libertador municipality in which part of the Uracoa, Tucupita and Bombal fields are located as follows:

• One claim was filed in April 2005 alleging the failure to pay taxes at a new rate set by the municipality. Harvest Vinccler has filed a protest with the Mayor’s Office and a motion with the Tax Court in Barcelona, Venezuela, to enjoin and dismiss the claim. On April 10, 2008, the Tax Court suspended the case pending a response from the Mayor’s Office to the protest. If the municipality’s response is to confirm the assessment, Harvest Holding will defer to the Tax Court to enjoin and dismiss the claim.

• Two claims were filed in June 2007. One claim relates to the period 2003 through 2006 and seeks to impose a tax on interest paid by PDVSA under the OSA. The second claim alleges a failure to pay taxes on estimated revenues for the third and fourth quarters of 2006. Harvest Vinccler has filed a motion with the Tax Court in Barcelona, Venezuela, to enjoin and dismiss both claims.

• Two claims were filed in July 2007 seeking to impose penalties on tax assessments filed and settled in 2004. Harvest Vinccler has filed a motion with the Tax Court in Barcelona, Venezuela, to enjoin and dismiss both claims.

Harvest Vinccler disputes the Libertador allegations set forth in the assessments and believes it has a substantial basis for its position. As a result of the SENIAT’s interpretation of the tax code as it applies to operating service agreements, Harvest Vinccler has filed claims in the Tax Court in Caracas against the Libertador Municipality for the refund of all municipal taxes paid since 2002.

On May 4, 2012, Harvest Vinccler learned that the Political Administrative Chamber of the Supreme Court of Justice issued a decision dismissing one of Harvest Vinccler’s claims against the Libertador Municipality. Harvest Vinccler continues to believe that it has sufficient arguments to maintain its position in accordance with the Venezuelan Constitution. Harvest Vinccler plans to present a request of Constitutional Revision to the Constitutional Chamber of the Supreme Court of Justice once it is notified officially of the decision. Harvest Vinccler has not received official notification of the decision. Harvest Vinccler is unable to predict the effect of this decision on the remaining outstanding municipality claims and assessments.

On February 21, 2014, Tecnica Vial and Flamingo, our partners in Colombia on Blocks VSM14 and VSM15, respectively, filed for arbitration of claims related to the farmout agreements for each block. We had received notices of default from our partners for failing to comply with certain terms of the farmout agreements, followed by notices of termination on November 27, 2013. We determined that it was appropriate to fully impair the costs associated with these interests, and we recorded an impairment charge of $3.2 million during the year ended December 31, 2013 which includes an accrual of $2 million related to this matter. We intend to vigorously defend the arbitration.

We are a defendant in or otherwise involved in other litigation incidental to our business. In the opinion of management, there is no such litigation that will have a material adverse effect on our financial condition, results of operations and cash flows.

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Note 14 – Taxes

Taxes on Income

The tax effects of significant items comprising our net deferred income taxes are as follows:

	As of December 31,
	2013						2012
	Foreign			United States And Other			Foreign			United States And Other
	(in thousands)
Deferred tax assets:
Operating loss carryforwards	$	58,051		$	2,928		$	54,231		$	4,498
Stock-based compensation		—			8,056			—			8,091
Accrued compensation		—			598			—			739
Oil and gas properties		1,606			1,015			—			—
Alternative minimum tax credit		—			4,501			—			2,261
Other		—			145			—			861
Total deferred tax assets		59,657			17,243			54,231			16,450
Deferred tax liabilities:
Tax on unremitted earnings of foreign subsidiaries		—			(89,900	)		—			—
Accrued income		—			—			(1,005	)		—
Prepaids		—			(198	)		—			(373	)
Other liabilities		—			(82	)		—			(35	)
Fixed assets		—			(12	)		—			(28	)
Total deferred tax liabilities		—			(90,192	)		(1,005	)		(436	)
Net deferred tax asset (liability)		59,657			(72,949	)		53,226			16,014
Valuation allowance		(59,576	)		—			(52,427	)		(15,992	)
Net deferred tax asset (liability) after valuation allowance	$	81		$	(72,949	)	$	799		$	22

After assessing the possible actions which management may take in 2014 and the next few years, as discussed further below, during the year ended December 31, 2013, we recognized a deferred tax liability of $89.9 million related to income tax on undistributed earnings for foreign subsidiaries.

Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets (“DTAs”). A significant piece of objective negative evidence evaluated was the cumulative losses incurred in our foreign operating entities over the three-year period ended December 31, 2013. Such objective evidence limits the ability to consider other subjective evidence such as our projections for future growth. We have therefore placed a valuation allowance (“VA”) on all of our foreign DTAs with the exception of $0.1 million related to NOL carryforwards in Venezuela which would be realized upon settlement of uncertain tax positions.

Management also reviewed the earnings history of our U.S. operations and determined that, while the Company does not have domestic production, it is expected to have sufficient taxable income in the U.S. related to the expected sale of the remaining equity interest in Harvest Holding. This is expected to allow the Company the ability to utilize the benefits related to its deferred tax assets which previously had a valuation allowance. As such, the Company has released the valuation allowances on the U.S. deferred tax assets.

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The components of loss from continuing operations before income taxes are as follows:

	Year Ended December 31,
	2013			2012			2011
	(in thousands)
Loss before income taxes
United States	$	(31,072	)	$	(33,841	)	$	(30,309	)
Foreign		(40,725	)		(18,915	)		(58,193	)
Total	$	(71,797	)	$	(52,756	)	$	(88,502	)

The provision (benefit) for income taxes on continuing operations consisted of the following at December 31:

	Year Ended December 31,
	2013			2012			2011
	(in thousands)
Current:
United States	$	2,279		$	(717	)	$	—
Foreign		44			929			3,693
		2,323			212			3,693
Deferred:
United States		72,971			(22	)		—
Foreign		(2,207	)		(799	)		(2,636	)
		70,764			(821	)		(2,636	)
	$	73,087		$	(609	)	$	1,057

A comparison of the income tax expense (benefit) on continuing operations at the federal statutory rate to our provision for income taxes is as follows:

	Year Ended December 31,
	2013			2012			2011
	(in thousands)
Income tax expense (benefit) from continuing operations:
Tax expense (benefit) at U.S. statutory rate	$	(25,129	)	$	(17,938	)	$	(30,805	)
Effect of foreign source income and rate differentials on foreign income		204			239			4,887
Tax gain associated with sale of interest in Harvest Holding		7,474			—			—
Subpart F income		16,615			—			—
Tax on unremitted earnings of foreign subsidiaries		89,900			—			—
Expired losses		1,356			—			—
Other changes in valuation allowance		(10,643	)		10,331			28,169
Change in applicable statutory rate		(404	)		—			—
Other permanent differences		(2,546	)		1,431			—
Return to accrual and other true-ups		2,919			1,257			—
Debt exchange		—			2,758			—
Warrant derivatives		(1,180	)		—			(1,445	)
Liability for uncertain tax positions		(5,553	)		799			237
Other		74			514			14
Total income tax expense – continuing operations		73,087			(609	)		1,057
Income tax expense (benefit) from discontinued operations:
Total income tax expense (benefit) – discontinued operations		—			—			5,748
Total income tax expense (benefit)	$	73,087		$	(609	)	$	6,805

Rate differentials for foreign income result from tax rates different from the U.S. tax rate being applied in foreign jurisdictions.

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At December 31, 2013, we have the following net operating losses available for carryforward (in thousands):

United States	$	8,364	Available for up to 20 years from 2012
Indonesia		54,435	Available for up to 5 years from 2011
Gabon		23,268	Available for up to 3 years from 2010
Oman		25,174	Available for up to 5 years from 2009
The Netherlands		109,634	Available for up to 9 years from 2007
Venezuela		3,043	Available for up to 3 years from 2010
Colombia		1,214	Available indefinitely

As a result of the first closing sale to Petroandina, the Company realized a tax gain of $47.5 million which is included in U.S. taxable income pursuant to the provisions of the Internal Revenue Code. The Company utilized $10.8 million of available losses from prior years as well as a current year tax loss of $36.7 million to offset income resulting from the sale resulting in no regular tax for the year ended December 31, 2013 leaving $8.4 million of losses available to offset taxable income in future periods. However, as a result of the alternative minimum tax provisions, we did incur AMT of $2.1 million increasing the amount of the AMT credit carryforward.

During the year, the Company released $5.6 million from our reserve for uncertain tax positions. This was primarily related to resolution of a Dutch tax issue regarding treatment of certain costs charged to our Dutch affiliate. However, a portion of this amount was offset by an adjustment to the valuation allowance, resulting in a net impact of $2.2 million.

If the U.S. operating loss carryforwards are ultimately realized, there would be no amounts credited to additional paid in capital for tax benefits associated with deductions for income tax purposes related to stock options and convertible debt.

Accumulated Undistributed Earnings of Foreign Subsidiaries

As of December 31, 2013, the book-tax outside basis difference in our foreign subsidiary resulting from unremitted earnings was approximately $334.8 million. Prior to 2013, no U.S. taxes had been recorded on these earnings as it was our practice and intention to reinvest the earnings of our non-U.S. subsidiaries in those operations.

Under ASC 740-30-25-17, no deferred tax liability must be recorded if sufficient evidence shows that the subsidiary has invested or will invest the undistributed earnings or that the earnings will be remitted in a tax-free manner. Management must consider numerous factors in determining timing and amounts of possible future distribution of these earnings to the parent company and whether a U.S. deferred tax liability should be recorded for these earnings. These factors include the future operating and capital requirements of both the parent company and the subsidiaries, remittance restrictions imposed by foreign governments or financial agreements and tax consequences of the remittance, including possible application of U.S. foreign tax credits and limitations on foreign tax credits that may be imposed by the Internal Revenue Code and regulations.

During the fourth quarter of 2013, management evaluated numerous factors related to the timing and amounts of possible future distribution of these earnings to the parent company, with consideration of the pending sale of the remaining equity interest in Harvest Holding as well as possible sales of other non-U.S. assets. While we will continue to invest the undistributed earnings to the extent possible and operate the Company’s business in the normal course, management is also considering distributions to the Company’s shareholders which could include the distribution of proceeds from the sales of assets by the Company’s foreign subsidiaries to the U.S. parent company resulting in U.S. taxable income. Because management is pursuing various alternatives, a determination was made that it was appropriate to record a deferred tax liability associated

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with the unremitted earnings of our foreign subsidiaries of $89.9 million in the fourth quarter of 2013. This liability includes $51.1 million which could become payable currently upon the sale of the remaining interest in Harvest Holding and is therefore reflected as a current deferred tax liability.

Accounting for Uncertainty in Income Taxes

The FASB issued ASC 740-10 (prior authoritative literature: Financial Interpretation No. [“FIN”] 48, “Accounting for Uncertainty in Income Taxes – An Interpretation of FASB Statement No. 109 [“FIN 48”]) to create a single model to address accounting for uncertainty in tax positions. FIN 48 clarifies the accounting for income taxes, by prescribing a minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. FIN 48 also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition.

We or one of our subsidiaries file income tax returns in the U.S. federal jurisdiction, and various states and foreign jurisdictions. With few exceptions, we are no longer subject to U.S. federal, state and local tax examinations by tax authorities for years before 2009. Our primary income tax jurisdictions and their respective open audit years are:

Tax Jurisdiction	Open Audit Years
United States	2010 – 2013
The Netherlands	2010 – 2013
Singapore	2009 – 2013
United Kingdom	2012 – 2013
Venezuela	2009 – 2013
Colombia	2013

In January 2014, the IRS began an audit of our tax returns for 2011 and 2012.

A reconciliation of the beginning amount, and current year additions, of unrecognized tax benefits follows:

	Year Ended December 31,
	2013			2012
	(in thousands)
Balance at beginning of year	$	5,871		$	5,072
Additions for tax positions of prior years		—			799
Reductions for tax positions of prior years		(5,553	)		—
Balance at end of year	$	318		$	5,871

The release of the reserve for uncertain tax positions of $5.6 million during the year ended December 31, 2013 is primarily related to the resolution of a Dutch tax matter regarding treatment of certain costs charged to our Dutch affiliate. However, a portion of this amount was offset by an adjustment to the valuation allowance resulting in a net tax benefit of $2.2 million. If the above tax benefits were recognized, the full amount would affect the effective tax rate. We have accrued interest of $0.0 million, and penalty of $0.1 million. We believe that it is likely that remaining amount for the uncertain tax position will be resolved within the next twelve months, and the amount of unrecognized tax benefits will significantly decrease.

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Note 15 – Stock-Based Compensation and Stock Purchase Plans

Total share-based compensation expense, which includes stock options, restricted stock, stock appreciation rights (“SARs”), and restricted stock units (“RSUs”), totaled $2.3 million for the year ended December 31, 2013 ($5.2 million and $4.8 million for the years ended December 31, 2012 and 2011, respectively). All awards utilize the straight line method of amortization over vesting terms. RSUs and SARs can be cash settled and are accounted for as liability instruments.

The cash flows resulting from tax deductions in excess of the compensation cost recognized for share-based awards (excess tax benefits) are classified as financing cash flows. The actual tax benefit realized from share-based awards during the year ended December 31, 2011 was $2.5 million. We did not realize tax benefits from share-based awards during the years ended December 31, 2013 or 2012.

Long Term Incentive Plans

As of December 31, 2013, we had several long term incentive plans under which stock options, restricted stock, SARs and RSUs can be granted to eligible participants including employees, non-employee directors and consultants of our Company or subsidiaries:

• 2010 Long Term Incentive Plan, as amended (“2010 Plan”) – Provides for the issuance of up to 2,725,000 shares of our common stock in satisfaction of stock options, SARs, restricted stock, RSUs and other stock-based awards. No more than 700,000 shares may be granted as restricted stock and no individual may be granted more than 1,000,000 stock options or SARs. The 2010 Plan also permits the granting of performance awards to eligible employees and consultants. In the event of a change in control, all outstanding stock options and SARs become immediately exercisable to the extent permitted by the plan, and any restrictions on restricted stock and RSUs lapse.

• 2006 Long Term Incentive Plan (“2006 Plan”) – Provides for the issuance of up to 1,825,000 shares of our common stock in satisfaction of stock options, SARs and restricted stock. No more than 325,000 shares may be granted as restricted stock, and no individual may be granted more than 900,000 stock options or SARs and not more than 175,000 shares of restricted stock during any period of three consecutive calendar years. The 2006 Plan also permits the granting of performance awards to eligible employees and consultants. In the event of a change in control, all outstanding stock options and SARs become immediately exercisable to the extent permitted by the plan, and any restrictions on restricted stock lapse.

• 2004 Long Term Incentive Plan (“2004 Plan”) – Provides for the issuance of up to 1,750,000 shares of our common stock in satisfaction of stock options, SARs and restricted stock. No more than 438,000 shares may be granted as restricted stock, and no individual may be granted more than 438,000 stock options and not more than 110,000 shares of restricted stock over the life of the plan. The 2004 Plan also permits the granting of performance awards to eligible employees and consultants. In the event of a change in control, all outstanding stock options and SARs become immediately exercisable to the extent permitted by the plan, and any restrictions on restricted stock lapse.

• 2001 Long Term Stock Incentive Plan (“2001 Plan”) – Provides for the issuance of up to 1,697,000 shares of our common stock in the form of Incentive Stock Options and Non-Qualified Stock Options. No officer may be granted more than 500,000 stock options during any one fiscal year, as adjusted for any changes in capitalization, such as stock splits. In the event of a change in control, all outstanding options become immediately exercisable to the extent permitted by the plan.

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Stock Options

Stock options granted under the plans must be no less than the fair market value of our common stock on the date of grant. Stock options granted under the plans generally are exercisable in varying cumulative periodic installments after one year. Stock options granted under the plans expire five to ten years from the date of grant. Stock options to purchase 52,333 common shares remained available for grant as of December 31, 2013 (85,006 as of December 31, 2012).

The fair value of each stock option award is estimated on the date of grant using the Black-Scholes option-pricing model which uses assumptions for the risk-free interest rate, volatility, dividend yield and the expected term of the options. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for a period equal to the expected term of the option. Expected volatility is based on historical volatilities of our stock. We do not assume any dividend yield since we do not pay dividends. The expected term of options granted is the weighted average life of stock options and represents the period of time that options are expected to be outstanding.

We also consider an estimated forfeiture rate for these stock option awards, and we recognize compensation cost only for those shares that are expected to vest, on a straight-line basis over the requisite service period of the award, which is generally the vesting term of three years. The forfeiture rate is based on historical experience.

Stock option transactions under our various stock-based employee compensation plans are presented below:

Options	Shares			Weighted- Average Exercise Price			Weighted- Average Remaining Contractual Term		Aggregate Intrinsic Value
	(in thousands, except exercise price)
Options outstanding as of December 31, 2012		3,897		$	9.62			2.6 years	$	3,064
Granted		920			4.80
Exercised		(20	)		(6.10	)
Cancelled		(64	)		(6.74	)
Options outstanding as of December 31, 2013		4,733		$	8.74			2.1 years	$	0
Options exercisable as of December 31, 2013		2,905		$	9.85			1.3 years	$	0

Of the options outstanding, 2.9 million were exercisable at weighted-average exercise price of 9.85 as of December 31, 2013 (2.5 million at $10.12 at December 31, 2012; 2.2 million at $10.15 at December 31, 2011).

During the year ended December 31, 2013, we awarded stock options vesting over three years to purchase 920,004 of our common shares to our employees and executive officers (451,298 and 498,500 stock options during the years ended December 31, 2012 and 2011, respectively).

The value of each stock option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:

	Year Ended December 31,
	2013			2012			2011
For options granted during:
Weighted average fair value	$	3.06		$	2.85		$	5.92
Weighted average expected life		5 years			5 years			5 years
Expected volatility (1)		79.4	%		67.3	%		61.3	%
Risk-free interest rate		1.3	%		0.7	%		1.8	%
Dividend yield		0.0	%		0.0	%		0.0	%

⁽¹⁾  Expected volatilities are based on historical volatilities of our stock.

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A summary of our unvested stock option awards as of December 31, 2013, and the changes during the year then ended is presented below:

Unvested Stock Options	Outstanding			Weighted- Average Grant-Date Fair Value
	(in thousands, except per share amount)
Unvested as of December 31, 2012		1,380		$	4.88
Granted		920			3.06
Vested		(452	)		(4.27	)
Forfeited		(20	)		(3.04	)
Unvested as of December 31, 2013		1,828			4.14

In September 2005, we issued 225,000 options at an exercise price of $10.91, and 165,000 options at an exercise price of $10.80, both from the 2004 Plan. From the 2001 Plan, we issued 85,000 options at an exercise price of $10.80. These grants all contained performance requirements. The performance requirements state that the average closing price of the Company’s common stock must equal or exceed $20 per share for ten consecutive trading days for these options to vest. These options are included as unvested options in the tables above.

The total intrinsic value of stock options exercised during the year ended December 31, 2013 was $0.1 million (2012: $0.3 million; 2011: $1.4 million). The total fair value of stock options that vested during the year ended December 31, 2013, was $1.9 million ($1.9 million and $2.7 million during the years ended December 31, 2012 and 2011, respectively).

As of December 31, 2013, there was $3.1 million of total future compensation cost related to unvested stock option awards that are expected to vest. That cost is expected to be recognized over a weighted average period of 2.1 years.

Restricted Stock

Restricted stock is issued on the grant date, but cannot be sold or transferred. Restricted stock granted to directors vest one year after date of grant. Restricted stock granted to employees vest at the third year after date of grant. Vesting of the restricted stock is dependent upon the employee’s continued service to Harvest.

A summary of our restricted stock awards as of December 31, 2013, and the changes during the year then ended is presented below:

Restricted Stock	Outstanding			Weighted Average Grant-Date Fair Value
Unvested as of December 31, 2012		284,750		$	8.93
Granted		190,002			4.80
Vested		(160,600	)		(7.23	)
Forfeited		0
Unvested as of December 31, 2013		314,152			7.30

On July 18, 2013, we awarded 100,002 shares of restricted stock to directors and 90,000 shares to employees as long-term incentives (0 and 179,050 shares during the years ended December 31, 2012 and 2011, respectively). In each of the years 2012 and 2011, we awarded 2,000 shares to new hire employees as employment inducement grants under a New York Stock Exchange (“NYSE”) exception (there were no such awards during the year ended December 31, 2013). The restricted stock issued in 2013 had an aggregate fair

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value at the date of grant of $0.9 million ($0.01 million and $2.0 million during the years ended December 31, 2012 and 2011, respectively). The restricted stock is scheduled to vest at the third year after date of grant for employees and one year after date of grant for directors. The value of the restricted stock that vested during the year ended December 31, 2013 was $1.2 million ($0.8 million and $3.4 million during the years ended December 31, 2012 and 2011, respectively). The weighted average grant date fair value of awards granted in 2012 was $5.85 and in 2011 it was $11.21.

As of December 31, 2013 there was $0.8 million of total future compensation cost related to unvested restricted stock awards that are expected to vest. That cost is expected to be recognized over a weighted average period of 1.4 years.

Stock Appreciation Rights (“SARs”)

All SAR awards granted to date have been granted outside of active long-term incentive plans and are held by Harvest employees. SARs granted in 2009 vest ratably over three years beginning with the third year of grant. SARs granted in 2012 vest ratably over three years beginning in the first year of grant. Vesting of SARs is dependent upon the employee’s continued service to Harvest. SAR awards are settled either in cash or Harvest common stock if available through an equity compensation plan. For recording of compensation, we assume the SAR award will be cash-settled and record compensation expense based on the fair value of the SAR awards at the end of each period.

SAR award transactions under our employee compensation plans are presented below:

Stock Appreciation Rights	SARs			Weighted- Average Exercise Price			Weighted- Average Remaining Contractual Term		Aggregate Intrinsic Value
									(in thousands)
SARs outstanding as of December 31, 2012		932,202		$	4.99
Granted		213,996			4.80
Exercised		0
Cancelled		(19,000	)		(5.12	)
SARs outstanding as of December 31, 2013		1,127,198		$	4.95			3.26 years	$	0
SARs exercisable as of December 31, 2013		394,394		$	4.91			2.84 years	$	0

Of the SAR awards outstanding, 74,997 were exercisable at weighted-average exercise price of $4.60 as of December 31, 2012 and 83,000 were exercisable at weighted-average exercise price of $4.60 at December 31, 2011.

During the year ended December 31, 2013, we awarded 213,996 SARs vesting over three years to our employees and executive officers (707,202 and 0 during the years ended December 31, 2012 and 2011, respectively).

The value of each SAR award is estimated on the date of grant using the Black-Scholes option pricing model using the assumptions discussed above.

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A summary of our unvested SAR awards as of December 31, 2013, and the changes during the year then ended is presented below:

Unvested Stock Appreciation Rights	Outstanding			Weighted- Average Fair Value
Unvested as of December 31, 2012		857,205		$	6.18
Granted		213,996			2.73
Vested		(323,063	)		(2.46	)
Forfeited		(15,334	)		(2.47	)
Unvested as of December 31, 2013		732,804			2.54

No SAR awards were exercised during the years ended December 2013 and 2011. The total intrinsic value of SAR awards exercised during the year ended December 31, 2012 was $0.3 million. The total fair value of SAR awards that vested during the year ended December 31, 2013, was $0.8 million ($0.3 million and $0.2 million during the years ended December 31, 2012 and 2011, respectively).

In September 2005, we issued 250,000 stock units with performance requirements at an exercise price of $10.80. The performance requirements are that the average closing price of the Company’s common stock must equal or exceed $25 per share for ten consecutive trading days for these stock units to vest. Upon vesting and exercise, the holder is entitled to 100 percent of the fair market value of the Company’s common stock on exercise date less the exercise price of $10.80. The settlement of these stock units would be a cash payment. These stock units are in addition to the units reflected in the tables above.

As of December 31, 2013, there was $1.2 million of total future compensation cost related to unvested SAR awards that are expected to vest. That cost is expected to be recognized over a weighted average period of 1.8 years.

Restricted Stock Units (“RSUs”)

All RSU awards granted to date have been granted outside of active long-term incentive plans, are held by Harvest employees and directors, and are settled either in cash or Harvest common stock if available through an equity compensation plan. RSU awards granted in 2009 vest ratably over three years beginning with the third year of grant. RSU awards granted in 2012 to employees vest at the third year after date of grant. RSU awards granted in 2012 to directors vest one year after date of grant. Vesting of the RSU awards is dependent upon the employee’s and director’s continued service to Harvest.

A summary of our RSU awards as of December 31, 2013, and the changes during the year then ended is presented below:

Restricted Stock Units	Outstanding			Weighted- Average Fair Value
Unvested as of December 31, 2012		530,006		$	9.07
Granted		0
Vested		(202,668	)		(4.12	)
Forfeited		(5,000	)		(4.52	)
Unvested as of December 31, 2013		322,338			4.52

During 2012, we awarded 388,000 RSU awards to employees and directors (none during 2011). The RSU awards issued in 2012 had an aggregate fair value at their date of grant of $2.0 million. The 202,668 RSU awards which vested in 2013 were settled in cash. The value of the RSU awards that vested during the year ended December 31, 2013 was $0.8 million ($0.4 million and $0.6 million during the years ended December 31, 2012 and 2011, respectively).

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As of December 31, 2013 there was $0.5 million of total future compensation cost related to unvested RSU awards expected to vest. That cost is expected to be recognized over a weighted average period of 1.3 years.

Common Stock Warrants

In connection with a $60 million term loan facility issued in November 2010, we issued (1) 1.2 million warrants exercisable at any time on or after the closing date of the term loan facility for a period of five years from the closing date on a cashless exercise basis at $15 per share until July 28, 2011, the Bridge Date, at which time the exercise price per share would be repriced to equal the lower of $15 or 120 percent of the average closing bid price of Harvest’s common stock for the 20 trading days immediately preceding the Bridge Date (“Tranche A”); (2) 0.4 million warrants exercisable at any time on or after the closing date of the term loan facility for a period of five years from the closing date on a cashless exercise basis at $20 per share until the Bridge Date, at which time the exercise price per share would be repriced to equal the lower of $15 or 120 percent of the average closing bid price of Harvest’s common stock for the 20 trading days immediately preceding the Bridge Date (“Tranche B”); and (3) 4.4 million warrants exercisable at any time on or after the Bridge Date for a period of five years from the Bridge Date on a cashless exercise basis at the lower of $15 per share or 120 percent of the average closing price of Harvest’s common stock for the 20 trading days immediately preceding the Bridge Date (“Tranche C”) (“collectively “the Warrants”). Tranche C was redeemable by Harvest for $0.01 per share at any time prior to the Bridge Date in conjunction with the repayment of the loan prior to the Bridge Date.

On May 17, 2011, in connection with the payment of the term loan facility, we redeemed all of Tranche C at $0.01 per share. The cost to redeem Tranche C ($44,000) was expensed to loss on extinguishment of debt in the six months ended June 30, 2011.

On July 28, 2011, the Bridge Date, Tranche A and Tranche B were repriced to $14.78 per warrant which is the lower of $15 or 120 percent of the average closing bid price of Harvest’s common stock for the 20 trading days immediately preceding the Bridge Date.

The Warrants include anti-dilution provisions which adjust the number of warrants and the exercise price per warrant based on the issuance of additional shares. Under the anti-dilution provision, 105,667 additional warrants were issued in the year ended December 31, 2013 (118,327 and 2,007 additional warrants during the years ended December 31, 2012 and 2011, respectively). In addition, the exercise price per share for all Warrants was repriced to $12.95 per warrant. The Warrants are classified as a liability on our consolidated balance sheets and marked to market.

If a fundamental change occurs, we are required to repurchase the Warrants at the higher of (1) the fair market value of the warrant and (2) a valuation based on a computation of the option value of the Warrant using the Black-Scholes calculation method using the assumptions described in the Warrant Agreement. A fundamental change is defined as “the occurrence of one of the following events: a) a person or group becomes the direct or indirect owner of more than 50% of the voting power of the outstanding common stock, b) a merger event or similar transaction in which the majority owners before the transaction fail to own a majority of the voting power of the Company after the transaction, and c) approval of a plan of liquidation or dissolution of the Company or sale of all or substantially all of the Company’s assets.” The completion of the second closing sale to Petroandina, assuming no prior fundamental change event, would result in a fundamental change event requiring the repurchase of the Warrants. See Note 12 – Warrant Derivative Liabilities for the impact on the valuation of the warrant derivative liabilities.

In connection with the 11 percent senior unsecured notes issued October 11, 2012, we issued warrants to purchase up to 0.7 million share of our common stock with an exercise price of $10.00 per share. The warrants can be exercised at any time up until the three-year anniversary of the closing. The Black-Scholes option pricing model was used in pricing the warrants. On the date of issuance in the year ended December 31, 2012, we recorded a credit to additional paid in capital of $2.8 million for the fair value of the warrants with a corresponding discount on debt on our consolidated balance sheet.

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The dates the warrants were issued, the expiration dates, the exercise prices and the number of warrants issued and outstanding at December 31, 2013 were:

				Warrants
Date Issued	Expiration Date	Exercise Price		Issued		Outstanding
				(in thousands)
November 2010	November 2015	$	12.95		1,600		1,600
October 2011	November 2015		12.95		2		2
March 2012	November 2015		12.95		73		73
August 2012	November 2015		12.95		30		30
October 2012	November 2015		12.95		15		15
July 2013	November 2015		12.95		29		29
October 2013	November 2015		12.95		22		22
November 2013	November 2015		12.95		55		55
October 2012	October 2015		10.00		687		687
					2,513		2,513

Note 16 – Operating Segments

We regularly allocate resources to and assess the performance of our operations by segments that are organized by unique geographic and operating characteristics. The segments are organized in order to manage regional business, currency and tax related risks and opportunities. Operations included under the heading “United States” include corporate management, cash management, business development and financing activities performed in the United States and other countries, which do not meet the requirements for separate disclosure. All intersegment revenues, other income and equity earnings, expenses and receivables are eliminated in order to reconcile to consolidated totals. Corporate general and administrative and interest expenses are included in the United States segment and are not allocated to other operating segments. In previous years, charges for intersegment general and administrative and interest expenses were included in results for the respective operating segments, and operating segment assets included intersegment receivables and loans. Segment income (loss) and operating segment assets for prior periods have been adjusted to conform to the current presentation method in which intersegment items are eliminated from each segment’s results and assets.

	Year Ended December 31,
	2013			2012			2011
				(in thousands)
Segment Income (Loss) Attributable to Harvest
Venezuela	$	58,640		$	51,584		$	54,974
Gabon		(12,908	)		(2,902	)		(6,158	)
Indonesia		(9,213	)		(4,052	)		(45,416	)
United States		(120,465	)		(42,431	)		(33,685	)
Income (loss) from continuing operations (a)		(83,946	)		2,199			(30,285	)
Discontinued operations		(5,150	)		(14,410	)		86,245
Net income (loss) attributable to Harvest	$	(89,096	)	$	(12,211	)	$	55,960

^(a)  Net of net income attributable to noncontrolling interest.

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	As of December 31,
	2013		2012
	(in thousands)
Operating Segment Assets
Venezuela	$	500,946	$	428,992
Gabon		107,851		80,908
Indonesia		5,004		9,587
United States		121,050		77,037
		734,851		596,524
Discontinued operations		29		313
Total Assets	$	734,880	$	596,837

Note 17 – Related Party Transactions

In November 2013, the Company sold 1,704,800 shares of its common stock in private placements to twelve purchasers for a price of $3.15 per share resulting in $5.4 million of proceeds from the sale. 246,000 shares of common stock sold in these transactions were sold to six officers and directors of the Company for the same purchase price of $3.15 per share or a total of $0.8 million.

On December 12, 2013, Harvest-Vinccler made an in-kind distribution to its shareholders of a note receivable from HNR Energia that it held. As a result, Vinccler received a $10.4 million note. HNR Energia paid $4.3 million of the amount owed on the note leaving $6.1 million outstanding as of December 31, 2013. Principal and interest are payable upon the maturity date of June 30, 2016. Interest accrues at a rate of US dollar based LIBOR plus 0.5%.

Note 18 – Quarterly Financial Data (unaudited)

Summarized quarterly financial data is as follows:

	Quarter Ended
	March 31			June 30			September 30			December 31
	(amounts in thousands, except per share data)
Year ended December 31, 2013
Expenses	$	(5,171	)	$	(9,653	)	$	(9,516	)	$	(21,096	)
Non-operating loss		2,253			(1,273	)		(7,764	)		(19,577	)
Loss from continuing operations before income taxes		(2,918	)		(10,926	)		(17,280	)		(40,673	)
Income tax expense (benefit)		39			(1,415	)		(765	)		75,228
Loss from continuing operations		(2,957	)		(9,511	)		(16,515	)		(115,901	)
Earnings (loss) from equity affiliate		49,471			7,602			25,747			(10,242	)
Income (loss) from continuing operations		46,514			(1,909	)		9,232			(126,143	)
Discontinued operations		(485	)		(1,006	)		(2,586	)		(1,073	)
Net income (loss)		46,029			(2,915	)		6,646			(127,216	)
Less: net income (loss) attributable to noncontrolling interest		9,932			1,551			4,693			(4,536	)
Net income (loss) attributable to Harvest	$	36,097		$	(4,466	)	$	1,953		$	(122,680	)
Basic Earnings (Loss) per Share:
Income (loss) from continuing operations	$	0.93		$	(0.09	)	$	0.12		$	(2.99	)
Discontinued operations		(0.01	)		(0.03	)		(0.07	)		(0.03	)
Net income (loss) attributable to Harvest	$	0.92		$	(0.12	)	$	0.05		$	(3.02	)
Diluted Earnings (Loss) per Share:
Income (loss) from continuing operations	$	0.92		$	(0.09	)	$	0.12		$	(2.99	)
Discontinued operations		(0.01	)		(0.03	)		(0.07	)		(0.03	)
Net income (loss) attributable to Harvest	$	0.91		$	(0.12	)	$	0.05		$	(3.02	)

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	Quarter Ended
	March 31			June 30			September 30			December 31
	(amounts in thousands, except per share data)
Year ended December 31, 2012
Expenses	$	(8,128	)	$	(7,837	)	$	(6,694	)	$	(16,167	)
Non-operating loss		(2,279	)		(3,085	)		(1,734	)		(6,832	)
Loss from continuing operations before income taxes		(10,407	)		(10,922	)		(8,428	)		(22,999	)
Income tax expense (benefit)		(1,220	)		(1,022	)		1,723			(90	)
Loss from continuing operations		(9,187	)		(9,900	)		(10,151	)		(22,909	)
Earnings from equity affiliate		16,896			22,829			20,299			7,745
Income (loss) from continuing operations		7,709			12,929			10,148			(15,164	)
Discontinued operations		(5,427	)		(2,164	)		(347	)		(6,472	)
Net income (loss)		2,282			10,765			9,801			(21,636	)
Less: net income attributable to noncontrolling interest		3,322			4,540			4,050			1,511
Net income (loss) attributable to Harvest	$	(1,040	)	$	6,225		$	5,751		$	(23,147	)
Basic Earnings (Loss) per Share:
Income (loss) from continuing operations	$	0.13		$	0.23		$	0.16		$	(0.43	)
Discontinued operations		(0.16	)		(0.06	)		(0.01	)		(0.16	)
Net income (loss) attributable to Harvest	$	(0.03	)	$	0.17		$	0.15		$	(0.59	)
Diluted Earnings (Loss) per Share:
Income (loss) from continuing operations	$	0.12		$	0.21		$	0.16		$	(0.43	)
Discontinued operations		(0.14	)		(0.06	)		(0.01	)		(0.16	)
Net income (loss) attributable to Harvest	$	(0.02	)	$	0.15		$	0.15		$	(0.59	)

Supplemental Information on Oil and Natural Gas Producing Activities (unaudited)

The following tables summarize our proved reserves, drilling and production activity, and financial operating data at the end of each year. Tables I through III provide historical cost information pertaining to costs incurred in exploration, property acquisitions and development; capitalized costs; and results of operations. Tables IV through VI present information on our estimated proved reserve quantities, standardized measure of estimated discounted future net cash flows related to proved reserves, and changes in estimated discounted future net cash flows.

TABLE I – Total costs incurred in oil and natural gas acquisition, exploration and development activities (in thousands):

	Gabon		Indonesia		Oman*		United States* and Other		Total
Year Ended December 31, 2013
Unproved exploration costs	$	26,214	$	0	$	0	$	0	$	26,214
	$	26,214	$	0	$	0	$	0	$	26,214
Year Ended December 31, 2012
Unproved exploration costs	$	30,386	$	4,078	$	6,741	$	0	$	41,205
	$	30,386	$	4,078	$	6,741	$	0	$	41,205
Year Ended December 31, 2011
Unproved acquisition costs	$	0	$	3,660	$	0	$	0	$	3,660
Unproved exploration costs		46,107		34,596		10,901		0		91,604
	$	46,107	$	38,256	$	10,901	$	0	$	95,264

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* Oman operations, Colombia operations and operations in the United States related to the Antelope Project have been discontinued operations. See Note 5 – Dispositions, Discontinued Operations for additional information.

TABLE II – Capitalized costs related to oil and natural gas producing activities (in thousands):

	Gabon (a)		Indonesia		Oman*		United States* and Other		Total
Year Ended December 31, 2013
Unproved property costs	$	99,447	$	4,470	$	0	$	0	$	103,917
Oilfield Inventories		3,966		130		0		0		4,096
	$	103,413	$	4,600	$	0	$	0	$	108,013
Year Ended December 31, 2012
Unproved property costs	$	73,233	$	5,220	$	0	$	0	$	78,453
Oilfield Inventories		3,209		130		0		0		3,339
	$	76,442	$	5,350	$	0	$	0	$	81,792
Year Ended December 31, 2011
Unproved property costs	$	46,447	$	5,195	$	5,084	$	2,900	$	59,626
Oilfield Inventories		2,480		140		209		0		2,829
	$	48,927	$	5,335	$	5,293	$	2,900	$	62,455

^(a)  Drilling activities were completed in September 2011 for Dussafu Ruche Marin-1 (“DRM-1”) exploratory well on the Dussafu PSC. DRM-1 well costs of $39.2 million were suspended pending further exploration and development activities. Exploration activities continued in 2012 with the acquisition of additional seismic and the spud of our second exploration well, DTM-1, on November 19, 2012.

 * Oman operations, Colombia operations and operations in the United States related to the Antelope Project have been discontinued operations. See Note 5 – Dispositions, Discontinued Operations for additional information.

We regularly evaluate our unproved properties to determine whether impairment has occurred. We have excluded from amortization our interest in unproved properties and the cost of uncompleted exploratory activities. The principal portion of such costs is expected to be included in amortizable costs during the next two to three years.

Unproved property costs at December 31, 2013 relates to two on-going projects. Costs incurred by year are as follows (in thousands):

	Total		2013		2012		2011		Prior
Property acquisition costs	$	12,463	$	0	$	0	$	3,660	$	8,803
Exploration costs		91,454		26,214		27,415		34,751		3,074
Total unproved property costs	$	103,917	$	26,214	$	27,415	$	38,411	$	11,877

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TABLE III – Results of operations for oil and natural gas producing activities (in thousands):

	Year Ended December 31,
	2013			2012
Revenue:
Oil and natural gas revenues	$	0		$	0
Expenses:
Operating, selling and distribution expenses and taxes other than on income		0			0
Exploration expense		15,155			9,068
Impairment of oil and gas properties costs		575			9,312
Dry hole costs		0			5,617
Depletion		0			0
Total expenses		15,730			23,997
Results of operations from oil and natural gas producing activities.	$	(15,730	)	$	(23,997	)

TABLE IV – Quantities of Oil and Natural Gas Reserves

Estimating oil and gas reserves is a very complex process requiring significant subjective decisions in the evaluation of all available geological, engineering and economic data for each reservoir. This data may change substantially over time as a result of numerous factors such as production history, additional development activity and continual reassessment of the viability of production under various economic and political conditions. Consequently, material upward or downward revisions to existing reserve estimates may occur from time to time; although, every reasonable efforts is made to ensure that reported results are the most accurate assessment available. We ensure that the data provided to our external independent experts, and their interpretation of that data, corresponds with our development plans and management’s assessment of each reservoir. The significance of subjective decisions required and variances in available data make estimates generally less precise than other estimates presented in connection with financial statement disclosures.

We measure and disclose our oil and gas reserves in accordance with the provisions of the SEC’s Modernization of Oil and Gas Reporting and ASC 932, “Extractive Activities – Oil and Gas” (“ASC 932”).

The process for preparation of our oil and gas reserves estimates is completed in accordance with our prescribed internal control procedures, which include verification of data provided for, management reviews and review of the independent third party reserves report. The technical employee responsible for overseeing the process for preparation of the reserves estimates has a Bachelor of Arts in Engineering Science, a Master of Science in Petroleum Engineering, has more than 25 years of experience in reservoir engineering and is a member of the Society of Petroleum Engineers.

All reserve information in this report is based on estimates prepared by Ryder Scott Company L.P. (“Ryder Scott”), independent petroleum engineers. The technical personnel responsible for preparing the reserve estimates at Ryder Scott meet the requirements regarding qualifications, independence, objectivity and confidentiality set forth in the Standards Pertaining to the Estimating and Auditing of Oil and Gas Reserves Information promulgated by the Society of Petroleum Engineers. Ryder Scott is an independent firm of petroleum engineers, geologists, geophysicists and petrophysicists; they do not own an interest in our properties and are not employed on a contingent fee basis.

See the following section Additional Supplemental Information on Oil and Natural Gas Producing Activities (unaudited) for Venezuela Equity Affiliate as of December 31, 2013, 2012 and 2011, TABLE IV – Quantities of Oil and Natural Gas Reserves for Petrodelta’s reserves.

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The table shown below represents our interests in the United States. On May 17, 2011, we closed the transaction to sell our Antelope Project. The sale had an effective date of March 1, 2011. We received cash proceeds of approximately $217.8 million which reflected increases to the purchase price for customary adjustments and deductions for transaction related costs. We do not have any continuing involvement with the Antelope Project. The related gain on the sale was reported in discontinued operations in the second quarter of 2011. The Antelope Project has been classified as discontinued operations.

	Year Ended December 31, 2011
	Oil and NGL     (MBbls)			Gas     (MMcf)
Proved Reserves:
United States:
Proved Reserves at January 1		3,515			6,492
Revisions		—			—
Acquisitions		—			—
Sales of reserves in place		(3,454	)		(6,155	)
Extensions		—			—
Production		(61	)		(337	)
Proved Reserves at December 31		—			—

TABLE V – Standardized Measure of Discounted Future Net Cash Flows Related to Proved Oil and  Natural Gas Reserve Quantities

The standardized measure of discounted future net cash flows is presented in accordance with the provisions of the accounting standard on disclosures about oil and gas producing activities. In preparing this data, assumptions and estimates have been used, and we caution against viewing this information as a forecast of future economic conditions.

Future cash inflows are estimated by applying the average price during the 12-month period, determined as an unweighted arithmetic average of the first-day-of-the-month price for each month within such period, adjusted for fixed and determinable escalations provided by the contract, to the estimated future production of year-end proved reserves. Future cash inflows are reduced by estimated future production and development costs to determine pre-tax cash inflows. Future income taxes are estimated by applying the year-end statutory tax rates to the future pre-tax cash inflows, less the tax basis of the properties involved, and adjusted for permanent differences and tax credits and allowances. The resultant future net cash inflows are discounted using a ten percent discount rate.

As of December 31, 2013 and 2012, we did not have a direct interest in any proved reserves. See the following section Additional Supplemental Information on Oil and Natural Gas Producing Activities (unaudited) for Venezuela Equity Affiliate as of December 31, 2013, 2012 and 2011, TABLE V – Standardized Measure of Discounted Future Net Cash Flows Related to Proved Oil and Natural Gas Reserve Quantities for Petrodelta’s reserves.

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TABLE VI – Changes in the Standardized Measure of Discounted Future Net Cash Flows from Proved    Reserves:

	United States
	Year Ended December 31, 2011
	(in thousands)
Standardized Measure at January 1	$	29,970
Sales of oil and natural gas, net of related costs		(3,334	)
Revisions to estimates of proved reserves:
Net changes in prices, net of production costs		26,140
Quantities		—
Purchase and sale of reserves in place		(45,627	)
Extensions, discoveries and improved recovery, net of future costs		—
Accretion of discount		—
Development costs incurred		2,784
Changes in estimated development costs		—
Net change in income taxes		(9,933	)
Standardized Measure at December 31	$	—

Additional Supplemental Information on Oil and Natural Gas Producing Activities (unaudited) for Petrodelta S.A.

The following tables summarize the proved reserves, drilling and production activity, and financial operating data at the end of each year for our net interest in Petrodelta. Tables I through III provide historical cost information pertaining to costs incurred in exploration, property acquisitions and development; capitalized costs; and results of operations. Tables IV through VI present information on our estimated proved reserve quantities, standardized measure of estimated discounted future net cash flows related to proved reserves, and changes in estimated discounted future net cash flows.

As discussed further in Note 5 – Dispositions, Share Purchase Agreement, on December 16, 2013, Harvest and HNR Energia entered into the Share Purchase Agreement with Petroandina and Pluspetrol, its parent, to sell all of our 80 percent equity interest in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement, when we sold a 29 percent equity interest in Harvest Holding for $125 million. As a result, our net ownership interest in Petrodelta as of December 31, 2013 is 20.4 percent. For periods prior to December 16, 2013, our net ownership interest was 32 percent.

Petrodelta is accounted for under the equity method, and has been included at its ownership interest in the consolidated financial statements and the following Tables based on a year ending December 31 and, accordingly, results of operations for oil and natural gas producing activities in Venezuela reflect the year ended December 31, 2013, 2012 and 2011.

TABLE I – Total costs incurred in oil and natural gas acquisition, exploration and development activities (in thousands):

	Year ended December 31,
	2013 (1)		2012 (1)		2011 (1)
Development costs	$	83,680	$	66,342	$	45,364

⁽¹⁾ These costs are stated net to our 32.0% interest through December 15, 2013 and 20.4% thereafter.

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TABLE II – Capitalized costs related to oil and natural gas producing activities (in thousands):

	As of December 31,
	2013 (1)			2012 (2)			2011 (2)
Proved property costs	$	213,181		$	250,259		$	184,640
Unproved property costs		0			0			1,434
Oilfield inventories		25,393			28,992			13,764
Less accumulated depletion and impairment		(72,683	)		(81,629	)		(57,346	)
	$	165,891		$	197,622		$	142,492

⁽¹⁾  Net to our 20.4% interest at December 31, 2013.

⁽²⁾ Net to our 32.0% interest at December 31, 2012 and 2011.

TABLE III – Results of operations for oil and natural gas producing activities (in thousands):

	Year Ended December 31,
	2013 (2)			2012 (2)			2011 (2)
Revenue:
Oil and natural gas revenues	$	419,307		$	404,577		$	360,222
Royalty		(139,093	)		(132,802	)		(118,339	)
		280,214			271,775			241,883
Expenses:
Operating, selling and distribution expenses and taxes other than on income (1)		120,613			149,082			114,835
Depletion		31,660			24,284			17,531
Income tax expense		63,970			49,205			54,759
Total expenses		216,243			222,571			187,125
Results of operations from oil and natural gas producing activities	$	63,971		$	49,204		$	54,758

⁽¹⁾  Expenses include operating expenses, production taxes and Windfall Profits Tax. Net to our percent interest, Windfall Profits Tax for December 31, 2013 was $56.4 million ($93.2 million and $76.0 million for the years ended December 31, 2012 and 2011, respectively).

⁽²⁾ These results are stated net to our 32.0% interest through December 15, 2013 and 20.4% thereafter.

TABLE IV – Quantities of Oil and Natural Gas Reserves

We measure and disclose our oil and gas reserves in accordance with the provisions of the SEC’s Modernization of Oil and Gas Reporting and ASC 932, “Extractive Activities – Oil and Gas” (“ASC 932”).

Petrodelta is producing from, and continuing to develop, the Petrodelta Fields. Petrodelta has both developed and undeveloped oil and gas reserves identified in all six fields. Petrodelta produces the fields in accordance with a business plan originally defined by its Conversion Contract executed in late 2007. Proved Undeveloped (“PUD”) oil and gas reserves are drilled in accordance with Petrodelta’s business plan, but can be revised where drilling results indicate a change is warranted.

During 2013, Petrodelta drilled and completed 13 production wells. 11 of the wells were previously identified Proved Undeveloped (“PUD”) locations and 2 wells were previously classified Probable, Possible or undefined locations. In 2013, an additional 5 PUD locations were identified through drilling activity; however, 25 PUD locations which are scheduled to be drilled five years after the wells were originally

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identified have been reclassified as Probable reserves. At December 31, 2013, Petrodelta had a total of 133 PUD (10.6 MMBOE) locations identified. Since the implementation of its 2007 business plan, Petrodelta has drilled 80 gross production wells (2009 15 wells [2.0 MMBOE], 2010 16 wells [2.0 MMBOE], 2011 15 wells [2.1 MMBOE], 2012 12 wells [2.2 MMBOE] and 2013 13 wells [1.2 MMBOE]) which have moved to the proved developed producing (“PDP”) category.

Petrodelta has a track record of identifying, executing and converting its PUD locations to PDP locations in accordance with the business plan defined by the conversion contract executed in 2007 and subsequent updates. However, the timing and pace of the development is controlled by the majority owner, PDVSA through CVP, although we have substantial negative control provisions as a noncontrolling interest shareholder. In 2010, Petrodelta submitted a revised business plan to PDVSA which substantially increases the total projected drilling activity and production volumes compared to the 2007 business plan, but which is otherwise consistent with the 2007 business plan. The 2010 business plan, as approved by PDVSA, contemplates sustained drilling activities through the year 2024 to fully develop the El Salto and Temblador fields. As a noncontrolling interest shareholder in Petrodelta, HNR Finance has limited ability to control the development plans that are periodically prepared and/or approved by the Venezuelan government. Since this constraint represents a hindrance to development not experienced by typical operations, the PUD locations which are now scheduled to be drilled five years after they were originally identified have been reclassified as Probable reserves.

Proved undeveloped reserves of 10.6 MMBOE from 133 gross PUD locations are all scheduled to be drilled within the period from 2014 to 2017 and within five years from when these locations were first identified.

All above MMBOE represent our net 20.4 percent interest, net of a 33.33 percent royalty.

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The tables shown below represent HNR Finance’s 40 percent ownership interest and our net percent ownership interest, both net of a 33.33 percent royalty, in Venezuela in each of the years.

	HNR Finance			Minority Interest in Venezuela			32%/20.4% Net Total
Proved Reserves-Crude oil, condensate, and natural gas liquids (MBbls)
Year Ended December 31, 2013 (32% to 20.4% net interest)
Proved Reserves at January 1, 2013 (32% net interest)		43,161			(8,632	)		34,529
Revisions		(3,668	)		1,798			(1,870	)
Extensions		804			(161	)		643
Production		(3,877	)		775			(3,102	)
Reduction in indirect ownership interest to 20.4% net interest		0			(11,626	)		(11,626	)
Proved Reserves at end of the year (20.4% net interest)		36,420			(17,846	)		18,574
As of December 31, 2013 (20.4% net interest)
Proved
Developed		16,436			(8,054	)		8,382
Undeveloped		19,984			(9,792	)		10,192
Total Proved		36,420			(17,846	)		18,574
Year Ended December 31, 2012 (32% net interest)
Proved Reserves at January 1, 2012		48,332			(9,667	)		38,665
Revisions		(3,941	)		788			(3,153	)
Extensions		2,283			(456	)		1,827
Production		(3,513	)		703			(2,810	)
Proved Reserves at end of the year		43,161			(8,632	)		34,529
As of December 31, 2012 (32% net interest)
Proved
Developed		15,607			(3,121	)		12,486
Undeveloped		27,554			(5,511	)		22,043
Total Proved		43,161			(8,632	)		34,529
Year Ended December 31, 2011 (32% net interest)
Proved Reserves at January 1, 2011		52,105			(10,421	)		41,684
Revisions		(10,829	)		2,166			(8,663	)
Extensions		10,093			(2,019	)		8,074
Production		(3,037	)		607			(2,430	)
Proved Reserves at end of the year		48,332			(9,667	)		38,665
As of December 31, 2011 (32% net interest)
Proved
Developed		17,147			(3,430	)		13,717
Undeveloped		31,185			(6,237	)		24,948
Total Proved		48,332			(9,667	)		38,665

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	HNR Finance			Minority Interest in Venezuela			32%/20.4% Net Total
Proved Reserves-Natural gas (MMcf)
Year Ended December 31, 2013 (32% to 20.4% net interest)
Proved Reserves at January 1, 2013		29,012			(5,802	)		23,210
Revisions		(2,914	)		1,428			(1,486	)
Extensions		126			(25	)		101
Production		(1,427	)		285			(1,142	)
Reduction in indirect ownership interest to 20.4%		0			(8,036	)		(8,036	)
Proved Reserves at end of the year		24,797			(12,150	)		12,647
As of December 31, 2013 (20.4% net interest)
Proved
Developed		20,451			(10,021	)		10,430
Undeveloped		4,346			(2,129	)		2,217
Total Proved		24,797			(12,150	)		12,647
Year Ended December 31, 2012(32% net interest)
Proved Reserves at January 1, 2012		34,800			(6,960	)		27,840
Revisions		(4,952	)		991			(3,961	)
Extensions		391			(78	)		313
Production		(1,227	)		245			(982	)
Proved Reserves at end of the year		29,012			(5,802	)		23,210
As of December 31, 2012 (32% net interest)
Proved
Developed		22,383			(4,477	)		17,906
Undeveloped		6,629			(1,325	)		5,304
Total Proved		29,012			(5,802	)		23,210
Year Ended December 31, 2011(32% net interest)
Proved Reserves at January 1, 2011		62,568			(12,513	)		50,055
Revisions		(29,111	)		5,822			(23,289	)
Extensions		2,627			(526	)		2,101
Production		(1,284	)		257			(1,027	)
Proved Reserves at end of the year		34,800			(6,960	)		27,840
As of December 31, 2011(32% net interest)
Proved
Developed		25,364			(5,073	)		20,291
Undeveloped		9,436			(1,887	)		7,549
Total Proved		34,800			(6,960	)		27,840

TABLE V – Standardized Measure of Discounted Future Net Cash Flows Related to Proved Oil and              Natural Gas Reserve Quantities

The standardized measure of discounted future net cash flows is presented in accordance with the provisions of the accounting standard on disclosures about oil and gas producing activities. In preparing this data, assumptions and estimates have been used, and we caution against viewing this information as a forecast of future economic conditions.

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Future cash inflows are estimated by an applying the average price during the 12-month period, determined as an unweighted arithmetic average of the first-day-of-the-month price for each month within such period, adjusted for fixed and determinable escalations provided by the contract, to the estimated future production of year-end proved reserves. Our average prices used were $84.14 per barrel for oil for the El Salto field ($89.77 in 2012 and $98.37 in 2011) and $97.89 per barrel for the other fields ($100.41 in 2012 and $98.37 in 2011), and $1.54 per Mcf for gas ($1.54 per Mcf in 2012 and $1.54 per Mcf in 2011). Future cash inflows were reduced by estimated future production and development costs to determine pre-tax cash inflows. Future income taxes were estimated by applying the year-end statutory tax rates to the future pre-tax cash inflows, less the tax basis of the properties involved, and adjusted for permanent differences and tax credits and allowances. The resultant future net cash inflows are discounted using a ten percent discount rate.

The table shown below represents HNR Finance’s net interest in Petrodelta.

	HNR Finance			Minority Interest in Venezuela			Net 32%/20.4% Total
	(in thousands)
As of December 31, 2013 (20.4% net interest)
Future cash inflows from sales of oil and gas	$	3,267,240		$	(1,600,948	)	$	1,666,292
Future production costs (1)		(1,352,126	)		662,542			(689,584	)
Future development costs		(240,844	)		118,014			(122,830	)
Future income tax expenses		(696,657	)		341,362			(355,295	)
Future net cash flows		977,613			(479,030	)		498,583
Effect of discounting net cash flows at 10%		(346,113	)		169,595			(176,518	)
Standardized measure of discounted futurenet cash flows	$	631,500		$	(309,435	)	$	322,065
As of December 31, 2012 (32% net interest)
Future cash inflows from sales of oil and gas	$	4,104,602		$	(820,920	)	$	3,283,682
Future production costs (2)		(1,992,109	)		398,421			(1,593,688	)
Future development costs		(364,986	)		72,997			(291,989	)
Future income tax expenses		(769,578	)		153,916			(615,662	)
Future net cash flows		977,929			(195,586	)		782,343
Effect of discounting net cash flows at 10%		(415,711	)		83,142			(332,569	)
Standardized measure of discounted futurenet cash flows	$	562,218		$	(112,444	)	$	449,774
As of December 31, 2011(32% net interest)
Future cash inflows from sales of oil and gas	$	4,862,351		$	(972,470	)	$	3,889,881
Future production costs (3)		(2,400,980	)		480,196			(1,920,784	)
Future development costs		(260,896	)		52,179			(208,717	)
Future income tax expenses		(1,025,295	)		205,059			(820,236	)
Future net cash flows		1,175,180			(235,036	)		940,144
Effect of discounting net cash flows at 10%		(496,127	)		99,225			(396,902	)
Standardized measure of discounted futurenet cash flows	$	679,053		$	(135,811	)	$	543,242

⁽¹⁾ Future production costs include operating costs, production taxes and Windfall Profits Tax. For 2013, Windfall Profits Tax equates to $848 million, or 63 percent, of the $1,352 million of undiscounted future production costs.

⁽²⁾ Future production costs include operating costs, production taxes and Windfall Profits Tax. For 2012, Windfall Profits Tax equates to $1,465 million, or 74 percent, of the $1,992 million of undiscounted future production costs.

⁽³⁾ Future production costs include operating costs, production taxes and Windfall Profits Tax. For 2011, Windfall Profits Tax equates to $1,622 million, or 68 percent, of the $2,400 million of undiscounted future production costs.

S-58

TABLE VI – Changes in the Standardized Measure of Discounted Future Net Cash Flows from Proved                Reserves (in thousands):

	Net Interest in Venezuela
	Year Ended December 31,
	2013			2012			2011
		(32% to 20.4%)			(32%)			(32%)
Standardized Measure at January 1	$	449,774		$	543,242		$	584,959
Sales of oil and natural gas, net of related costs		(159,601	)		(122,693	)		(127,049	)
Revisions to estimates of proved reserves:
Net changes in prices, net of production taxes		57,745			(44,084	)		(108,785	)
Quantities		(61,614	)		(91,770	)		(221,510	)
Extensions, discoveries and improved recovery, net of future costs		21,040			52,535			201,203
Accretion of discount		51,710			100,028			113,310
Net change in income taxes		12,656			86,445			77,006
Development costs incurred		83,680			66,342			45,364
Changes in estimated development costs		7,356			(131,356	)		(13,564	)
Reduction in indirect ownership interest to 20.4%		(142,007	)		0			0
Timing differences and other		1,326			(8,915	)		(7,692	)
Standardized Measure at December 31	$	322,065		$	449,774		$	543,242

S-59

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

			HARVEST NATURAL RESOURCES, INC.
			(Registrant)
Date:	March 17, 2014	By:	/s/ James A. Edmiston
			James A. Edmiston
			Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed by the following persons on the             of March 2014, on behalf of the registrant and in the capacities indicated:

Signature	Title
/s/ James A. Edmiston James A. Edmiston	Director, President and Chief Executive Officer (Principal Executive Officer)
/s/ Stephen C. Haynes Stephen C. Haynes	Vice President – Finance, Chief Financial Officer and Treasurer (Principal Financial Officer and Principal Accounting Officer)
/s/ Stephen D. Chesebro’ Stephen D. Chesebro’	Chairman of the Board and Director
/s/ Igor Effimoff Igor Effimoff	Director
/s/ H. H. Hardee H. H. Hardee	Director
/s/ R. E. Irelan R. E. Irelan	Director
/s/ Patrick M. Murray Patrick M. Murray	Director
/s/ J. Michael Stinson J. Michael Stinson	Director

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EX-10.39

Exhibit 10.39

SUBSCRIPTION AGREEMENT

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY STATE OR ANY OTHER JURISDICTION. THERE ARE FURTHER RESTRICTIONS ON THE TRANSFERABILITY OF THE SECURITIES DESCRIBED HEREIN.

THE PURCHASE OF THESE SECURITIES INVOLVES A HIGH DEGREE OF RISK AND SHOULD BE CONSIDERED ONLY BY PERSONS WHO CAN BEAR THE RISK OF THE LOSS OF THEIR ENTIRE INVESTMENT.

Harvest Natural Resources, Inc.

1177 Enclave Parkway, Suite 300

Houston, Texas 77077

Ladies and Gentlemen:

The undersigned (collectively, the “Purchaser”) understands that Harvest Natural Resources, Inc., a corporation organized under the laws of Delaware (the “Company”), is offering shares of its common stock, par value $.01 per share (“Common Stock”), in a private placement. The Purchaser further understands that the offering is being made without registration of the Shares under the Securities Act of 1933, as amended (the “Securities Act”), or any securities law of any state of the United States or of any other jurisdiction, and is being made only to “accredited investors” (as defined in Rule 501 of Regulation D under the Securities Act).

1. Subscription. Subject to the terms and conditions hereof, the Purchaser hereby irrevocably subscribes for an aggregate of             shares of Common Stock (the “Shares”) for the purchase price of $            per share, which is payable as described in Section 4 hereof. The Purchaser acknowledges that the Shares will be subject to restrictions on transfer as set forth in this subscription agreement (the “Subscription Agreement”).

2. Acceptance of Subscription and Issuance of Shares. It is understood and agreed that the Company shall have the sole right, at its complete discretion, to accept or reject this subscription, in whole or in part, for any reason and that the same shall be deemed to be accepted by the Company only when it is signed by a duly authorized officer of the Company and delivered to the Purchaser at the Closing referred to in Section 3 hereof. Subscriptions need not be accepted in the order received, and the Shares may be allocated among subscribers. Notwithstanding anything in this Subscription Agreement to the contrary, the Company shall have no obligation to issue any of the Shares to any person who is a resident of a jurisdiction in which the issuance of Shares to such person would constitute a violation of the securities, “blue sky” or other similar laws of such jurisdiction (collectively referred to as the “State Securities Laws”).

3. The Closing. The closing of the purchase and sale of the Shares (the “Closing”) shall take place at the offices of Fulbright & Jaworski LLP, 1301 McKinney, Suite 5100, Houston, Texas 77010, at 9:00 a.m. central time on             , 2013, or at such other time and place as the Company may designate by notice to the Purchaser.

4. Payment for Shares. Payment for the Shares shall be received by the Company from the Purchaser by wire transfer of immediately available funds or other means approved by the Company at or prior to the Closing, in the amount as set forth in Section 1 hereto. The Company shall deliver or cause to be delivered the Shares to the Purchaser at the Closing bearing an appropriate legend referring to the fact that the Shares were sold in reliance upon an exemption from registration under the Securities Act.

5. Representations and Warranties of the Company. As of the Closing, the Company represents and warrants that:

(a) The Company is duly formed and validly existing under the laws of Delaware, with full power and authority to conduct its business as it is currently being conducted and to own its assets; and has secured any other authorizations, approvals, permits and orders required by law for the conduct by the Company of its business as it is currently being conducted.

(b) The Company has the corporate power and authority to enter into this Subscription Agreement and to perform and to discharge its obligations hereunder. This Subscription Agreement has been duly authorized, executed and delivered by the Company, and constitutes a valid and binding obligation of the Company enforceable against the Company in accordance with its terms.

(c) The Shares have been duly authorized and, when issued, delivered and paid for in the manner set forth in this Subscription Agreement, will be validly issued, fully paid and nonassessable.

6. Representations and Warranties of the Purchaser. The Purchaser hereby represents and warrants to and covenants with the Company that:

(a) General.

(i) The Purchaser has all requisite authority to purchase the Shares, enter into this Subscription Agreement and to perform and to discharge its obligations hereunder, and such purchase will not contravene any law, rule or regulation binding on the Purchaser or any investment guideline or restriction applicable to the Purchaser.

(ii) This Subscription Agreement has been duly authorized, executed and delivered by the Purchaser, and constitutes a valid and binding obligation of the Purchaser enforceable against the Purchaser in accordance with its terms.

(iii) The Purchaser is a resident of the state set forth on the signature page hereto and is not acquiring the Shares as a nominee or agent or otherwise for any other person.

(iv) The Purchaser will comply with all applicable laws and regulations in effect in any jurisdiction in which the Purchaser purchases or sells Shares and obtain any consent, approval or permission required for such purchases or sales under the laws and regulations of any jurisdiction to which the Purchaser is subject or in which the Purchaser makes such purchases or sales, and the Company shall have no responsibility therefor.

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(b) Information Concerning the Company.

(i) The Purchaser and its advisors, if any, have been furnished with all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale of the Shares that have been requested by the Purchaser. The Purchaser has had access to the Company’s reports and other filings with the U.S. Securities and Exchange Commission (the “Commission”) and has had the opportunity to review such filings. The Purchaser and its advisors, if any, have been afforded the opportunity to ask questions of the Company. Neither such inquiries nor any other due diligence investigations conducted by the Purchaser or its advisors, if any, or its representatives shall modify, amend or affect the Purchaser’s right to rely on the Company’s representations and warranties contained herein. The Purchaser understands that its investment in the Shares involves a high degree of risk and is able to afford a complete loss of such investment. The Purchaser has sought such accounting, legal and tax advice from persons other than the Company as it has considered necessary to make an informed investment decision with respect to its acquisition of the Shares.

(ii) The Purchaser confirms that it is not relying on any communication (written or oral) of the Company or any of its affiliates, as investment advice or as a recommendation to purchase the Shares. It is understood that information and explanations related to the terms and conditions of the Shares provided by the Company or any of its affiliates shall not be considered investment advice or a recommendation to purchase the Shares, and that neither the Company nor any of its affiliates is acting or has acted as an advisor to the Purchaser in deciding to invest in the Shares. The Purchaser acknowledges that neither the Company nor any of its affiliates has made any representation regarding the proper characterization of the Shares for purposes of determining the Purchaser’s authority to invest in the Shares.

(iii) The Purchaser is familiar with the business and financial condition and operations of the Company. The Purchaser has had access to such information concerning the Company and the Shares as it deems necessary to enable it to make an informed investment decision concerning the purchase of the Shares.

(iv) The Purchaser understands that, unless the Purchaser notifies the Company in writing to the contrary at or before the Closing, each of the Purchaser’s representations and warranties contained in this Subscription Agreement will be deemed to have been reaffirmed and confirmed as of the Closing, taking into account all information received by the Purchaser.

(v) The Purchaser acknowledges that the Company has the right in its sole and absolute discretion to abandon this private placement at any time prior to the completion of the offering. This Subscription Agreement shall thereafter have no force or effect and the Company shall return the previously paid subscription price of the Shares, without interest thereon, to the Purchaser.

(vi) The Purchaser understands that no federal or state agency has passed upon the merits or risks of an investment in the Shares or made any finding or determination concerning the fairness or advisability of this investment.

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(c) Non-reliance.

(i) The Purchaser represents that it is not relying on (and will not at any time rely on) any communication (written or oral) of the Company, as investment advice or as a recommendation to purchase the Shares, it being understood that information and explanations related to the terms and conditions of the Shares provided by the Company shall not be considered investment advice or a recommendation to purchase the Shares.

(ii) The Purchaser confirms that the Company has not (A) given any guarantee or representation as to the potential success, return, effect or benefit (either legal, regulatory, tax, financial, accounting or otherwise) of investment in the Shares or (B) made any representation to the Purchaser regarding the legality of an investment in the Shares under applicable legal investment or similar laws or regulations. In deciding to purchase the Shares, the Purchaser is not relying on the advice or recommendations of the Company and the Purchaser has made its own independent decision that the investment in the Shares is suitable and appropriate for the Purchaser.

(d) Status of Purchaser.

(i) The Purchaser has such knowledge, skill and experience in business, financial and investment matters that the Purchaser is capable of evaluating the merits and risks of an investment in the Shares. With the assistance of the Purchaser’s own professional advisors, to the extent that the Purchaser has deemed appropriate, the Purchaser has made its own legal, tax, accounting and financial evaluation of the merits and risks of an investment in the Shares and the consequences of this Subscription Agreement. The Purchaser has considered the suitability of the Shares as an investment in light of its own circumstances and financial condition and the Purchaser is able to bear the risks associated with an investment in the Shares and its authority to invest in the Shares.

(ii) The Purchaser is an “accredited investor” as defined in Rule 501(a) under the Securities Act. The Purchaser agrees to furnish any additional information requested by the Company or any of its affiliates to assure compliance with applicable U.S. federal and state securities laws in connection with the purchase and sale of the Shares. Any information that has been furnished or that will be furnished by the Purchaser to evidence its status as an accredited investor is accurate and complete, and does not contain any misrepresentation or material omission.

(e) Restrictions on Transfer or Sale of Shares. As applies to the Purchaser:

(i) The Purchaser is acquiring the Shares solely for the Purchaser’s own beneficial account, for investment purposes, and not with a view to, or for resale in connection with, any distribution of the Shares. The Purchaser understands that the Shares have not been registered under the Securities Act or any State Securities Laws by reason of specific exemptions under the provisions thereof which depend in part upon the investment intent of the Purchaser and of the other representations made by the Purchaser in this Subscription Agreement. The Purchaser understands that the Company is relying upon the representations and agreements contained in this Subscription Agreement (and any supplemental information) for the purpose of determining whether this transaction meets the requirements for such exemptions.

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(ii) The Purchaser understands that the Shares are “restricted securities” under applicable federal securities laws and that the Securities Act and the rules of the Commission provide in substance that the Purchaser may dispose of the Shares only pursuant to an effective registration statement under the Securities Act or an exemption therefrom, and the Purchaser understands that the Company has no obligation or intention to register any of the Shares, or to take action so as to permit sales pursuant to the Securities Act (including Rule 144 thereunder). Accordingly, the Purchaser understands that under the Commission’s rules, the Purchaser may dispose of the Shares principally only in “private placements” which are exempt from registration under the Securities Act, in which event the transferee will acquire “restricted securities” subject to the same limitations as in the hands of the Purchaser. Consequently, the Purchaser understands that the Purchaser must bear the economic risks of the investment in the Shares for an indefinite period of time.

(iii) The Purchaser agrees: (A) that the Purchaser will not sell, assign, pledge, give, transfer or otherwise dispose of the Shares or any interest therein, or make any offer or attempt to do any of the foregoing, except pursuant to a registration of the Shares under the Securities Act and all applicable State Securities Laws, or in a transaction which is exempt from the registration provisions of the Securities Act and all applicable State Securities Laws; (B) that the certificates representing the Shares will bear a legend making reference to the foregoing restrictions; and (C) that the Company and its affiliates shall not be required to give effect to any purported transfer of such Shares except upon compliance with the foregoing restrictions.

(iv) The Purchaser acknowledges that neither the Company nor any other person offered to sell the Shares to it by means of any form of general solicitation or advertising, including but not limited to: (A) any advertisement, article, notice or other communication published in any newspaper, magazine or similar media or broadcast over television or radio or (B) any seminar or meeting whose attendees were invited by any general solicitation or general advertising.

7. Conditions to Obligations of the Undersigned and the Company. The obligations of the Purchaser to purchase and pay for the Shares and of the Company to sell the Shares are subject to the satisfaction at or prior to the Closing of the following conditions precedent: the representations and warranties of the Company contained in Section 5 hereof and of the Purchaser contained in Section 6 hereof shall be true and correct as of the Closing in all respects with the same effect as though such representations and warranties had been made as of the Closing.

8. Obligations Irrevocable. The obligations of the Purchaser shall be irrevocable.

9. Legend. The certificates representing the Shares sold pursuant to this Subscription Agreement will be imprinted with a legend in substantially the following form:

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“THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. THE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (1) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OR (2) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE STATE SECURITIES LAWS AND THE SECURITIES LAWS OF OTHER JURISDICTIONS, AND IN THE CASE OF A TRANSACTION EXEMPT FROM REGISTRATION, UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT AND SUCH OTHER APPLICABLE LAWS.”

10. Waiver, Amendment. Neither this Subscription Agreement nor any provisions hereof shall be modified, changed, discharged or terminated except by an instrument in writing, signed by the party against whom any waiver, change, discharge or termination is sought.

11. Assignability. Neither this Subscription Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by either the Company or the Purchaser without the prior written consent of the other party.

12. Waiver of Jury Trial. THE UNDERSIGNED IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISING OUT OF THE TRANSACTIONS CONTEMPLATED BY THIS SUBSCRIPTION AGREEMENT.

13. Submission to Jurisdiction. With respect to any suit, action or proceeding relating to any offers, purchases or sales of the Shares by the Purchaser (“Proceedings”), the Purchaser irrevocably submits to the jurisdiction of the federal or state courts located in the Borough of Manhattan in New York City, which submission shall be exclusive unless none of such courts has lawful jurisdiction over such Proceedings.

14. Governing Law. This Subscription Agreement shall be governed by and construed in accordance with the laws of the State of New York.

15. Section and Other Headings. The section and other headings contained in this Subscription Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Subscription Agreement.

16. Counterparts. This Subscription Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which together shall be deemed to be one and the same agreement.

17. Notices. All notices and other communications provided for herein shall be in writing and shall be deemed to have been duly given if delivered personally or sent by registered or certified mail, return receipt requested, postage prepaid or by facsimile transmission (with receipt of successful and full transmission) to the following addresses (or such other address as either party shall have specified by notice in writing to the other):

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If to the Company:	Harvest Natural Resources, Inc. 1177 Enclave Parkway, Suite 300 Houston, Texas 77077 Facsimile:     281 899 5702 Attention:     General Counsel
with a copy to:	Fulbright & Jaworski LLP 2200 Ross Avenue, Suite 2800 Dallas, Texas 75201-2784 Facsimile:     214 855 8200 Attention:     Harva R. Dockery
If to the Purchaser:	[PURCHASER ADDRESS] Facsimile:     [FAX NUMBER] Attention:     [TITLE OF OFFICER TO RECEIVE NOTICES]
with a copy to:	[PURCHASER LAW FIRM] Facsimile:     [FAX NUMBER] Attention:     [ATTORNEY NAME]

18. Binding Effect. The provisions of this Subscription Agreement shall be binding upon and accrue to the benefit of the parties hereto and their respective heirs, legal representatives, successors and assigns.

19. Survival. All representations, warranties and covenants contained in this Subscription Agreement shall survive the acceptance of the subscription by the Company.

20. Notification of Changes. The Purchaser hereby covenants and agrees to notify the Company upon the occurrence of any event prior to the closing of the purchase of the Shares pursuant to this Subscription Agreement which would cause any representation, warranty, or covenant of the Purchaser contained in this Subscription Agreement to be false or incorrect.

21. Severability. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction.

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[SIGNATURE PAGE FOLLOWS]

8

IN WITNESS WHEREOF, the Purchaser has executed this Subscription Agreement this             of             , 2013.

PURCHASER:

[Legal Name of Entity]

By                                                                                                   

Name:

Title:

State/Country of Domicile or Formation:                                                                                                                                    

The offer to purchase Shares as set forth above is confirmed and accepted by the Company.

Harvest Natural Resources, Inc.

By                                                                                                   

Name:

Title:

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Purchasers of Common Stock Under Subscription Agreements

Date of Sale (2013)	Purchaser	No. of Shares		Purchase Price Per Share		Aggregate Purchase Price
October 1	Glenhill Capital Overseas Master Fund, LP		291,000	$	5.13	$	1,492,830
October 1	Glenhill Long Fund, LP		26,000	$	5.13	$	133,380
October 1	Glenhill Long Equities Master Fund, LP		73,000	$	5.13	$	374,490
October 4	Scoggin Capital Management II LLC		217,000	$	4.82	$	1,045,940
October 4	TCW/Scoggin Event Driven Master Fund LP		9,500	$	4.82	$	45,790
October 4	Scoggin International Fund Ltd.		173,500	$	4.82	$	836,270
November 27	GLG Market Neutral Fund		158,800	$	3.15	$	500,220
November 27	Glenhill Capital Overseas Master Fund, LP		325,000	$	3.15	$	1,023,750
November 27	Glenhill Long Fund, LP		35,000	$	3.15	$	110,250
November 27	Glenhill Long Equities Master Fund, LP		40,000	$	3.15	$	126,000
November 27	Caisse de depot et placement du Quebec		500,000	$	3.15	$	1,575,000
November 27	Stephen D. Chesebro’(1)		100,000	$	3.15	$	315,000
November 27	Patrick M. Murray(1)		25,000	$	3.15	$	78,750
November 27	J. Michael Stinson(1)		31,000	$	3.15	$	97,650
November 27	James A. Edmiston(1)(2)		50,000	$	3.15	$	157,500
November 27	Stephen C. Haynes(2)		10,000	$	3.15	$	31,500
November 27	Robert Speirs(2)		30,000	$	3.15	$	94,500

(1) Director of the Company

(2) Officer of the Company

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EX-10.40

Exhibit 10.40

SUBSCRIPTION AGREEMENT

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY STATE OR ANY OTHER JURISDICTION. THERE ARE FURTHER RESTRICTIONS ON THE TRANSFERABILITY OF THE SECURITIES DESCRIBED HEREIN. THE PURCHASE OF THESE SECURITIES INVOLVES A HIGH DEGREE OF RISK AND SHOULD BE CONSIDERED ONLY BY PERSONS WHO CAN BEAR THE RISK OF THE LOSS OF THEIR ENTIRE INVESTMENT.

Harvest Natural Resources, Inc.

1177 Enclave Parkway, Suite 300

Houston, Texas 77077

Ladies and Gentlemen:

The undersigned purchaser (the “Purchaser”) understands that Harvest Natural Resources, Inc., a corporation organized under the laws of Delaware (the “Company”), is offering shares of its common stock, par value $0.01 per share (“Common Stock”), in a private placement. The Purchaser further understands that the offering is being made without registration of the Shares (as defined below) under the Securities Act of 1933, as amended (the “Securities Act”), or any securities law of any state of the United States or of any other jurisdiction, and is being made only to “accredited investors” (as defined in Rule 501 of Regulation D under the Securities Act).

1. Subscription. Subject to the terms and conditions hereof, the Purchaser hereby subscribes for 400,000 shares of Common Stock (the “Shares”) at a purchase price of $3.15 per share (the “Per Share Purchase Price”) for an aggregate purchase price of $1,260,000.00 (the “Aggregate Purchase Price”), which is payable as described in Section 4 hereof. The Purchaser acknowledges that the Shares will be subject to restrictions on transfer as set forth in this subscription agreement (the “Subscription Agreement”).

2. Acceptance of Subscription and Issuance of Shares. It is understood and agreed that the Company shall have the sole right, at its complete discretion, to accept or reject this subscription, in whole or in part, for any reason and that the same shall be deemed to be accepted by the Company only when it is signed by a duly authorized officer of the Company and delivered to the Purchaser at the Closing referred to in Section 3 hereof. Subscriptions need not be accepted in the order received, and the Shares may be allocated among subscribers. Notwithstanding anything in this Subscription Agreement to the contrary, the Company shall have no obligation to issue any of the Shares to any person who is a resident of a jurisdiction in which the issuance of Shares to such person would constitute a violation of the securities, “blue sky” or other similar laws of such jurisdiction (collectively referred to as the “State Securities Laws”).

3. The Closing. The closing of the purchase and sale of the Shares (the “Closing’’) shall take place at the offices of Fulbright & Jaworski LLP, 1301 McKinney, Suite 5100, Houston, Texas 77010, at 9:00 a.m. central time on November 26, 2013, or at such other time and place as the Company may designate by notice to the Purchaser (such date, the “Closing Date”).

4. Payment for Shares. The Aggregate Purchase Price for the Shares shall be received by the Company from the Purchaser by wire transfer of immediately available funds or other means approved by the Company in the amount as set forth in Section 1 hereto. The Company shall deliver or cause to be delivered the Shares to the Purchaser at the Closing bearing an appropriate legend referring to the fact that the Shares were sold in reliance upon an exemption from registration under the Securities Act.

5. Representations and Warranties of the Company. As of the date of this Subscription Agreement and on and as of the Closing Date, the Company represents and warrants that:

(a) Existence. The Company is a corporation duly formed, validly existing and in good standing under the laws of the State of Delaware, with full power and authority to conduct its business as it is currently being conducted and to own its assets and has secured any other authorizations, approvals, permits and orders required by applicable law, rule or regulation for the conduct by the Company of its business as it is currently being conducted.

(b) Authority. The Company has the corporate power and authority to enter into this Subscription Agreement and to perform and to discharge its obligations hereunder. This Subscription Agreement has been duly authorized, executed and delivered by the Company, and constitutes a valid and binding obligation of the Company enforceable against the Company in accordance with its terms.

(c) Valid Issuance of Shares. The Shares have been duly authorized and, when issued, delivered and paid for in the manner set forth in this Subscription Agreement, will be validly issued, fully paid and non-assessable and will be free and clear of any and all liens, encumbrances and restrictions on transfer, other than restrictions on transfer set pursuant to applicable state and federal securities laws.

(d) Company SEC Documents. The Company has filed with the United States Securities and Exchange Commission (the “SEC”) all forms, registration statements, reports, schedules and statements required to be filed by it under the Securities Exchange Act of 1934, as amended from time to time, and the rules and regulations of the SEC promulgated thereunder (the “Exchange Act”) or the Securities Act (all such documents filed on or prior to the date of this Subscription Agreement, collectively, the “Company SEC Documents”). The Company SEC Documents, including any audited or unaudited financial statements and any notes thereto or schedules included therein (the “Company Financial Statements”), at the time filed (in the case of registration statements, solely on the dates of effectiveness) (except to the extent corrected by a subsequently filed Company SEC Document filed prior to the date of this Subscription Agreement) (i) did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, (ii) complied in all material respects with the applicable requirements of the Exchange Act and the Securities Act, as the case may be, (iii) complied as to form in all material respects with applicable accounting requirements and with the published rules and regulations of the SEC with respect thereto (iv) were prepared in accordance with generally accepted accounting principles in the United States of America in effect from time to time (“GAAP”) applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto or, in the case

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of unaudited statements, as permitted by Form 10-Q of the SEC) and (v) fairly presented (subject in the case of unaudited statements to normal, recurring and year-end audit adjustments) in all material respects the consolidated financial position and status of the business of the Company as of the dates thereof and the consolidated results of its operations and cash flows for the periods then ended. UHY LLP is the independent registered public accounting firm with respect to the Company and has not resigned or been dismissed as independent registered public accountants of the Company as a result of or in connection with any disagreement with the Company on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedures.

(e) No Material Adverse Change. Except as set forth in or contemplated by the Company SEC Documents, since September 30, 2013, the Company has conducted its business in the ordinary course, consistent with past practice, and there has been no (i) change that has had or would reasonably be expected to have a Company Material Adverse Effect (as defined below), (ii) acquisition or disposition of any material asset by the Company or any of its subsidiaries or any contract or arrangement therefor, otherwise than for fair value in the ordinary course of business, (iii) material change in the Company’s accounting principles, practices or methods or (iv) incurrence of material indebtedness. For purposes of this Subscription Agreement, “Company Material Adverse Effect” shall mean any material or adverse effect on (i) the assets, liabilities, financial condition, business, operations, prospects or affairs of the Company and its subsidiaries, taken as a whole, other than those occurring as a result of general economic or financial conditions or other developments that are not unique to and do not have a disproportionate impact on the Company and its subsidiaries but also affect other persons who participate in or are engaged in the lines of business of which the Company and its subsidiaries participate or are engaged, (ii) the ability of the Company and its subsidiaries taken as a whole, to carry out their business as of the date of this Subscription Agreement or to meet their obligations under this Subscription Agreement or any other agreement and instrument being executed in connection with this Subscription Agreement (collectively, the “Transaction Documents”) on a timely basis or (iii) the ability of the Company to consummate the transactions contemplated by the Transaction Documents (collectively, the ‘‘Transactions”).

(f) Litigation. Except as set forth in the Company SEC Documents, there is no action pending or, to the knowledge of the Company, contemplated or threatened against the Company or any of its subsidiaries or any of their respective officers, directors, properties or assets, which (individually or in the aggregate) reasonably would be expected to have a Company Material Adverse Effect or which challenges the validity of any of the Transaction Documents or the consummation of the transactions contemplated hereby and thereby.

(g) No Conflicts. The execution, delivery and performance by the Company of this Subscription Agreement, the other Transaction Documents, and compliance by the Company with the terms and provisions hereof and thereof, do not and will not (a) violate any provision of any applicable law, rule, regulation, permit, determination or award having applicability to the Company or any of its subsidiaries or any of their respective properties or assets, (b) conflict with or result in a violation of any provision of the Company’s governing documents or any other organizational documents of any of the Company’s subsidiaries, (c) require any consent, approval or notice under or result in a violation or breach of or constitute (with or without due notice or lapse of time or both) a default (or give rise to any right of termination, cancellation

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or acceleration) under (i) any note, bond, mortgage, license, or loan or credit agreement to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries or any of their respective properties or assets may be bound or (ii) any other agreement, instrument or obligation, or (d) result in or require the creation or imposition of any lien upon or with respect to any of the properties or assets now owned or hereafter acquired by the Company or any of its subsidiaries.

(h) Compliance with Laws. Neither the Company nor any of its subsidiaries is in violation of any judgment, decree or order or any applicable law, rule or regulation, except as would not, individually or in the aggregate, have a Company Material Adverse Effect. Neither the Company, nor any of its subsidiaries, nor any director, officer, agent, employee or other person acting on behalf of the Company or any of its subsidiaries has, in the course of its actions for, or on behalf of, the Company or any of its subsidiaries (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended; or (iv) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any foreign or domestic government official or employee.

(i) Approvals. Except as contemplated by this Agreement, no authorization, consent, approval, waiver, license, qualification or written exemption from, nor any filing, declaration, qualification or registration with, any governmental authority or any other person is required in connection with the execution, delivery or performance by the Company of any of the Transaction Documents to which it is a party.

(j) Capitalization. The Company currently has 40,409,546 shares of Common Stock outstanding.

(k) Most Favored Terms. In the last 30 days, the Company has not entered into any other agreement related to the sale, transfer or other disposition of its Common Stock (any such agreement, the “Other Agreement”) with any other purchaser (any such purchaser, the “Other Purchaser”) that is in any respect more favorable to the Other Purchaser than this Subscription Agreement is to the Purchaser, including , without limitation, with respect to: (i) the Per Share Purchase Price of the Common Stock (including through the payment of any fees to such Other Purchaser), (ii) representations and warranties made by the Company or the Other Purchaser, (iii) conditions precedent to closing the transactions that are subject to this Subscription Agreement, (iv) covenants or other agreements of the Company or the Purchaser relating to restrictions on transferability of the acquired Common Stock; (v) termination rights by the Company or the Purchaser; and (vi) indemnification obligations by or to the Company or the Purchaser.

6. Representations and Warranties of the Purchaser. The Purchaser hereby represents and warrants to and covenants with the Company that:

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(a) General.

(i) The Purchaser has all requisite authority to purchase the Shares, enter into this Subscription Agreement and to perform and to discharge its obligations hereunder, and such purchase will not contravene any law, rule or regulation binding on the Purchaser or any investment guideline or restriction applicable to the Purchaser. The purchase of the Shares does not require any consent, approval or notice under any law or regulation applicable to Purchaser, or any agreement by which Purchaser is bound, except as would not reasonably be expected to prevent Purchaser from performing its obligations hereunder.

(ii) This Subscription Agreement has been duly authorized, executed and delivered by the Purchaser, and constitutes a valid and binding obligation of the Purchaser enforceable against the Purchaser in accordance with its terms.

(iii) The Purchaser is domiciled in the jurisdiction set forth on the signature page hereto and is not acquiring the Shares as a nominee or agent or otherwise for any other person.

(b) Information Concerning the Company.

(i) The Purchaser and its advisors, if any, have been furnished with all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale of the Shares that have been requested by the Purchaser. The Purchaser and its advisors, if any, have been afforded the opportunity to ask questions of the Company. Neither such inquiries nor any other due diligence investigations conducted by the Purchaser or its advisors, if any, or its representatives shall modify, amend or affect the Purchaser’s right to rely on the Company’s representations and warranties contained herein. The Purchaser understands that its investment in the Shares involves a high degree of risk and is able to afford a complete loss of such investment. The Purchaser has sought such accounting, legal and tax advice from persons other than the Company as it has considered necessary to make an informed investment decision with respect to its acquisition of the Shares.

(ii) The Purchaser confirms that it is not relying on any communication (written or oral) of the Company or any of its affiliates, as investment advice or as a recommendation to purchase the Shares. It is understood that information and explanations related to the terms and conditions of the Shares provided by the Company or any of its affiliates shall not be considered investment advice or a recommendation to purchase the Shares, and that neither the Company nor any of its affiliates is acting or has acted as an advisor to the Purchaser in deciding to invest in the Shares. The Purchaser acknowledges that neither the Company nor any of its affiliates has made any representation regarding the proper characterization of the Shares for purposes of determining the Purchaser’s authority to invest in the Shares.

(iii) The Purchaser is familiar with the business and financial condition and operations of the Company.

(iv) The Purchaser understands that, unless the Purchaser notifies the Company in writing to the contrary at or before the Closing, each of the Purchaser’s representations and warranties contained in this Subscription Agreement will be deemed to have been reaffirmed and confirmed as of the Closing, taking into account all information received by the Purchaser.

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(v) The Purchaser acknowledges that the Company has the right in its sole and absolute discretion to abandon this private placement at any time prior to the completion of the offering. This Subscription Agreement shall thereafter have no force or effect and the Company shall return the previously paid subscription price of the Shares, without interest thereon, to the Purchaser.

(vi) The Purchaser understands that no federal or state agency has passed upon the merits or risks of an investment in the Shares or made any finding or determination concerning the fairness or advisability of this investment.

(c) Status of Purchaser.

(i) The Purchaser has such knowledge, skill and experience in business, financial and investment matters that the Purchaser is capable of evaluating the merits and risks of an investment in the Shares. With the assistance of the Purchaser’s own professional advisors, to the extent that the Purchaser has deemed appropriate, the Purchaser has made its own legal, tax, accounting and financial evaluation of the merits and risks of an investment in the Shares and the consequences of this Subscription Agreement. The Purchaser has considered the suitability of the Shares as an investment in light of its own circumstances and financial condition and the Purchaser is able to bear the risks associated with an investment in the Shares and its authority to invest in the Shares.

(ii) The Purchaser is an “accredited investor” as defined in Rule 501(a) under the Securities Act. The Purchaser agrees to furnish any additional information requested by the Company or any of its affiliates to assure compliance with applicable U.S. federal and state securities laws in connection with the purchase and sale of the Shares. Any information that has been furnished or that will be furnished by the Purchaser to evidence its status as an accredited investor is accurate and complete, and does not contain any misrepresentation or material omission.

(d) Restrictions on Transfer or Sale of Shares. As applies to the Purchaser:

(i) The Purchaser is acquiring the Shares solely for the Purchaser’s own account, for investment purposes, and not with a view to, or for resale in connection with, any distribution of the Shares. The Purchaser understands that the Shares have not been registered under the Securities Act or any State Securities Laws by reason of specific exemptions under the provisions thereof which depend in part upon the investment intent of the Purchaser and of the other representations made by the Purchaser in this Subscription Agreement. The Purchaser understands that the Company is relying upon the representations and agreements contained in this Subscription Agreement (and any supplemental information) for the purpose of determining whether this transaction meets the requirements for such exemptions.

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(ii) The Purchaser understands that the Shares are “restricted securities” under applicable federal securities laws and that the Securities Act and the rules of the SEC provide in substance that the Purchaser may dispose of the Shares only pursuant to an effective registration statement under the Securities Act or an exemption therefrom and the Purchaser understands that the Company has no obligation or intention to register any of the Shares, or to take action so as to permit sales pursuant to the Securities Act (including Rule 144 thereunder). Accordingly, the Purchaser understands that under the SEC’s rules, the Purchaser may dispose of the Shares principally only in “private placements” which are exempt from registration under the Securities Act, in which event the transferee will acquire “.restricted securities” subject to the same limitations as in the hands of the Purchaser. Consequently, the Purchaser understands that the Purchaser must bear the economic risks of the investment in the Shares for an indefinite period of time.

(iii) The Purchaser agrees: (A) that the Purchaser will not sell, assign, pledge, give, transfer or otherwise dispose of the Shares or any interest therein, or make any offer or attempt to do any of the foregoing, except pursuant to a registration of the Shares under the Securities Act and all applicable State Securities Laws, or in a transaction which is exempt from the registration provisions of the Securities Act and all applicable State Securities Laws; (B) that the certificates representing the Shares will bear a legend making reference to the foregoing restrictions; and (C) that the Company and its affiliates shall not be required to give effect to any purported transfer of such Shares except upon compliance with the foregoing restrictions.

(iv) The Purchaser acknowledges that neither the Company nor any other person offered to sell the Shares to it by means of any form of general solicitation or advertising, including but not limited to: (A) any advertisement, article, notice or other communication published in any newspaper, magazine or similar media or broadcast over television or radio or (B) any seminar or meeting whose attendees were invited by any general solicitation or general advertising.

7. Covenants of the Company and the Purchaser.

(a) Use of Proceeds. The Company agrees to use the net proceeds from the sale of the Shares solely for working capital and general corporate purposes.

(b) NYSE Listing of Shares. Promptly following the date of this Subscription Agreement, the Company will submit an additional listing application to The New York Stock Exchange (the “NYSE”) with respect to the Shares. The Company will maintain the listing of the currently outstanding Common Stock on the NYSE and, once the Shares are listed on the NYSE, will maintain such listing.

(c) Regulatory Filings. The Company shall, on or before 8:30 a.m., New York time, on the first business day following the Closing, issue a press release disclosing all material terms of the transactions contemplated herein, in the Transaction Documents and in any Other Agreements executed and consummated concurrently with this Subscription Agreement and not previously disclosed to the public. Thereafter, the Company shall timely file any filings and notices required by the SEC or applicable law with respect to the transactions contemplated hereby. Notwithstanding the foregoing, the Company shall not publicly disclose the name of the Purchaser, or include the name of the Purchaser in any press release, without the prior written consent of the Purchaser.

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(d) Most Favored Terms. For a period of 30 days after the date hereof, the Company will not enter into any Other Agreement, or amend any Other Agreement, with any other purchaser (any such purchaser, the “Other Purchaser”) so that the Other Agreement is in any respect more favorable to the Other Purchaser than this Subscription Agreement is to the Purchaser, including, without limitation, with respect to: (i) the Per Share Purchase Price of the Common Stock (including through the payment of any fees to such Other Purchaser), (ii) representations and warranties made by the Company or the Other Purchaser, (iii) conditions precedent to closing the transactions that are subject to this Subscription Agreement, (iv) covenants or other agreements of the Company or the Purchaser relating to restrictions on transferability of the acquired Common Stock; (v) termination rights by the Company or the Purchaser; and (vi) indemnification obligations by or to the Company or the Purchaser.

(e) Further Assurances. Each of the Company and the Purchaser agrees to use its commercially reasonable efforts to promptly take or cause to be taken all action and to promptly do or cause to be done all things necessary, proper or advisable under applicable law, rule or regulation to consummate and make effective the Transactions. Without limiting the foregoing, the Company and the Purchaser will, and the Company shall cause each of its subsidiaries to, use its commercially reasonable efforts to make all filings and obtain all consents of governmental authorities that may be necessary or, in the reasonable opinion of the Purchaser or the Company, as the case may be, advisable for the consummation of the Transactions and the other Transaction Documents.

(f) Registration Rights. If at any time prior to the one year anniversary of the Closing, the Company grants registration rights to any third party, or files a registration statement on Form S-1 or S-3, in each case, relating to the Company’s Common Stock, the Company agrees to grant the Purchaser substantially identical registration rights (excluding the ability to make registration demands), or include the Shares in such registration statement upon terms customarily found in a registration rights agreement.

8. Conditions to Obligations of the Purchaser and the Company.

(a) The obligations of the Purchaser and the Company to consummate the issuance, sale and purchase of the Shares are subject to the satisfaction at or prior to the Closing of the following conditions precedent (any or all of which may be waived by a particular party on behalf of itself in writing, in whole or in part, to the extent permitted by applicable law):

(i) no law, rule or regulation shall have been enacted or promulgated, and no action shall have been taken, by any governmental authority of competent jurisdiction which in any way restrains, precludes, enjoins or otherwise prohibits the consummation of the Transactions or makes the Transactions illegal; and

(ii) there shall not be pending any action by any governmental authority seeking to restrain, preclude, enjoin or prohibit the Transactions.

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(b) The obligations of the Purchaser to purchase and pay for the Shares are subject to the satisfaction at or prior to the Closing of the following conditions precedent:

(i) the representations and warranties of the Company contained in this Subscription Agreement that are qualified by materiality or Company Material Adverse Effect shall be true and correct when made and as of the Closing, all other representations and warranties (other than Section 5(j)) of the Company shall be true and correct in all material respects when made and as of the Closing and the representation and warranty made in Section 5(j) shall be true and correct in all respects, in each case as though made at and as of the Closing;

(ii) the Company shall have performed and complied with the covenants and agreements contained in this Subscription Agreement in all material respects that are required to be performed and complied with by the Company on or prior to the Closing;

(iii) since the date of this Subscription Agreement, no Company Material Adverse Effect shall have occurred and be continuing;

(iv) the NYSE shall have approved the listing application with respect to the Shares and no notice of delisting from the NYSE shall have been received by the Company with respect to the Common Stock;

(v) the Company shall have delivered, or caused to be delivered, to the Purchaser at the Closing, the Company’s closing deliverables described in Section 9 of this Subscription Agreement;

(vi) prior to or concurrent with the Closing, the Company shall have consummated transactions with other purchasers for the issuance, sale and purchase of no less than 1,300,000 additional shares of Common Stock (excluding the Shares) at a purchase price no less than the Per Share Purchase Price; and

(vii) the Closing shall have occurred on or prior to the Termination Date.

(c) The obligations of the Company to sell the Shares are subject to the satisfaction at or prior to the Closing of the following conditions precedent:

(i) the representations and warranties of the Purchaser contained in this Subscription Agreement that are qualified by materiality shall be true and correct when made and as of the Closing and all other representations and warranties of the Purchaser contained in this Subscription Agreement shall be true and correct in all material respects when made and as of the Closing, in each case as though made at and as of the Closing; and

(ii) the Purchaser shall have performed and complied with the covenants and agreements contained in this Subscription Agreement in all material respects that are required to be performed and complied with by the Purchaser on or prior to the Closing.

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9. Company Closing Deliverables. At or prior to the Closing, the Company will deliver, or cause to be delivered, to the Purchaser:

(a) a certificate of the Secretary of the Company, dated as of the Closing, in substantially the form attached to this Subscription Agreement as Exhibit A; and

(b) an opinion addressed to the Purchaser from outside legal counsel to the Company in substantially the form attached to this Subscription Agreement as Exhibit B.

10. Legend. The certificates representing the Shares sold pursuant to this Subscription Agreement will be imprinted with a legend in substantially the following form:

“THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. THE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (1) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OR (2) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE STATE SECURITIES LAWS AND THE SECURITIES LAWS OF OTHER JURISDICTIONS, AND IN THE CASE OF A TRANSACTION EXEMPT FROM REGISTRATION, UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT AND SUCH OTHER APPLICABLE LAWS.”

11. Waiver, Amendment. Neither this Subscription Agreement nor any provisions hereof shall be amended, modified, waived, discharged or terminated except by an instrument in writing, signed by the party against whom any such amendment, modification, waiver, discharge or termination is sought.

12. Assignability. Neither this Subscription Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by either the Company or the Purchaser without the prior written consent of the other party; provided that the Purchaser shall be permitted to assign this Subscription Agreement to an affiliate or a third party which purchases the Shares from the Purchaser in a private transaction.

13. Termination. Notwithstanding anything herein to the contrary, this Subscription Agreement shall automatically terminate if the Closing shall not have occurred on or before 5:00 P.M. (New York Time) on November 27, 2013 (such date, the “Termination Date”). In the event of the termination of this Subscription Agreement as provided in this Section 13, this Subscription Agreement shall forthwith become null and void and there shall be no liability on the part of any party hereto; provided that nothing herein shall relieve any party from any liability or obligation with respect to any willful breach of this Subscription Agreement.

14. Waiver of Jury Trial. THE PARTIES HERETO IRREVOCABLY WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISING OUT OF THE TRANSACTIONS.

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15. Submission to Jurisdiction. With respect to any suit, action or proceeding relating to any offers, purchases or sales of the Shares by the Purchaser (“Proceedings”), the parties hereto irrevocably submit to the jurisdiction of the federal or state courts located in the Borough of Manhattan in New York City, which submission shall be exclusive unless none of such courts has lawful jurisdiction over such Proceedings.

16. Governing Law. This Subscription Agreement shall be governed by and construed in accordance with the laws of the State of New York.

17. Section and Other Headings. The section and other headings contained in this Subscription Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Subscription Agreement.

18. Counterparts. This Subscription Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which together shall be deemed to be one and the same agreement.

19. Notices. All notices and other communications provided for herein shall be in writing and shall be deemed to have been duly given if delivered personally or sent by registered or certified mail, return receipt requested, postage prepaid or by facsimile transmission (with receipt of successful and full transmission) to the following addresses (or such other address as either party shall have specified by notice in writing to the other):

If to the Company:	Harvest Natural Resources, Inc.
	1177 Enclave Parkway, Suite 300
	Houston, Texas 77077
	Facsimile:     281 899 5702
	Attention:     General Counsel
with a copy to:	Fulbright & Jaworski LLP
	2200 Ross Avenue, Suite 2800
	Dallas, Texas 75201-2784
	Facsimile:     214 855 8200
	Attention:     Harva R. Dockery
If to the Purchaser:	MSD Credit Opportunity Master Fund, L.P.
	c/o MSDC Management, L.P.
	645 Fifth Avenue, 21st Floor
	New York, NY 10022
	Facsimile:     (212) 303-1772
	Attention:     Marcello Liguori

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20. Binding Effect. The provisions of this Subscription Agreement shall be binding upon and accrue to the benefit of the parties hereto and their respective heirs, legal representatives, successors and assigns.

21. Survival. All representations, warranties and covenants contained in this Subscription Agreement shall survive the acceptance of the subscription by the Company.

22. Notification of Changes. The Purchaser and the Company hereby covenant and agree to notify the other party upon the occurrence of any event prior to the Closing which would cause any representation, warranty, or covenant of the Purchaser or the Company, as applicable, contained in this Subscription Agreement to be false or incorrect.

23. Severability. If any term or provision of this Subscription Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Subscription Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction.

24. Entire Agreement. This Subscription Agreement and the other transaction documents sets forth the entire agreement and understanding of the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understanding between the parties hereto with respect to the transactions contemplated hereby.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the Purchaser has executed this Subscription Agreement this 25^th of November, 2013.

PURCHASER:
MSD Credit Opportunity Master Fund, L.P.
By	/s/ Marcello Liguori
Name:	Marcello Liguori
Title:	Managing Director

State/Country of Domicile or Formation: Cayman Islands

The offer to purchase Shares as set forth above is confirmed and accepted by the Company.

Harvest Natural Resources, Inc.
By	/s/ Stephen C. Haynes
Title:	VP and Chief Financial Officer

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EX-10.42

Exhibit 10.42

EXECUTION VERSION

SHAREHOLDERS’ AGREEMENT

By and Among

HNR ENERGIA B.V.

and

PETROANDINA RESOURCES CORPORATION N.V.

DATED AS OF DECEMBER 16, 2013

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TABLE OF CONTENTS

		Page
Article I         DEFINITIONS			3
Section 1.01	Definitions		3
Section 1.02	General Interpretive Principles		9
Article II         REPRESENTATIONS AND WARRANTIES			10
Section 2.01	Representations and Warranties of All Parties		10
Article III         TRANSFER RESTRICTIONS			10
Section 3.01	General Transfer Restrictions		10
Section 3.02	Tag-Along		11
Section 3.03	Change of Control Put Option		12
Section 3.04	Litigation Put Option		13
Section 3.05	Permitted Transfers; Transfer Approval		15
Section 3.06	Fair Market Value Determination		15
Article IV         GOVERNANCE			16
Section 4.01	Consent Rights		16
Section 4.02	Board Participation		17
Article V         ADDITIONAL AGREEMENTS			17
Section 5.01	Information Rights		17
Section 5.02	Inspection and Audit Rights		18
Section 5.03	Consultation		18
Section 5.04	Fiduciary Duties of Directors		18
Section 5.05	Payment of Dividends		18
Section 5.06	Company Joinder		18
Section 5.07	Participation Right		19
Article VI         TAX MATTERS			19
Section 6.01	Administration of Tax Matters		19
Section 6.02	Cooperation; Audits; Tax-Related Actions		19
Section 6.03	Referee		20
Article VII         MISCELLANEOUS			20
Section 7.01	Term and Termination		20
Section 7.02	Specific Performance		20
Section 7.03	Successors and Assigns; Third Party Beneficiaries		20
Section 7.04	Amendments; Waiver		21
Section 7.05	Notices		21
Section 7.06	Governing Law and Exclusive Jurisdiction; Service of Process; Waiver of Jury Trial		22
Section 7.07	Headings		23
Section 7.08	Entire Agreement		23
Section 7.09	Severability		23
Section 7.10	Certain Limitations		23
Section 7.11	Counterparts		23

Exhibits

Exhibit A	Form of Shareholder Joinder
Exhibit B	Parent Guarantee
Exhibit C	Form of Put Contract

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This SHAREHOLDERS’ AGREEMENT is dated as of December 16, 2013 (this “Agreement”), by and among HNR Energia B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) organized and existing under the Laws of Curaçao (the “Majority Shareholder”) and Petroandina Resources Corporation N.V., a company with limited liability (naamloze vennootschap) organized and existing under the Laws of the Netherlands (the “Minority Shareholder”).

WHEREAS, the Majority Shareholder owns 100% of the Subject Shares (as hereinafter defined) of Harvest-Vinccler Dutch Holding B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) organized and existing under the Laws of the Netherlands (the “Company”);

WHEREAS, the Minority Shareholder, the Majority Shareholder, solely with respect to Article V and Section 11.13 thereof, Pluspetrol Resources Corporation B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) organized and existing under the Laws of the Netherlands, and Harvest Natural Resources, Inc., a Delaware corporation (“Parent”), are parties to a Stock Purchase Agreement, dated as of the date hereof (the “SPA”), pursuant to which, upon the Initial Closing (as defined in the SPA), the Minority Shareholder will acquire thirty six and one-quarter percent (36.25%) of the issued and outstanding Subject Shares (as hereinafter defined) and, upon the Final Closing (as defined in the SPA), the Minority Shareholder will acquire all of the remaining issued and outstanding Subject Shares;

WHEREAS, it is a condition to the Initial Closing that, among other things, this Agreement be executed and delivered by the parties hereto;

WHEREAS, in the event the SPA has terminated at any time prior to consummation of the Final Closing thereunder, the parties hereto desire that all terms of this Agreement, and all rights and obligations of the parties hereunder, shall come into full force and effect on the date of such termination and thereafter; and

WHEREAS, concurrently with the execution and delivery of this Agreement, and as a condition and inducement to the willingness of the Minority Shareholder to enter into this Agreement, Parent has executed and delivered a guarantee in favor of the Minority Shareholder pursuant to which Parent is guaranteeing the obligations of the Majority Shareholder, its Affiliates and Permitted Transferees in connection with this Agreement.

NOW, THEREFORE, in consideration of the foregoing and the mutual promises, covenants and agreements of the parties hereto, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

Article I

DEFINITIONS

Section 1.01 Definitions. As used in this Agreement, the following terms shall have the meanings indicated below:

“Adversary Proceeding” means any arbitration, litigation or other adversary proceeding.

“Affiliate” means, with respect to any Person, any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such Person. For purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise.

“Agreement” has the meaning assigned in the preamble.

“Appraiser” has the meaning assigned in Section 3.06(a).

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“Beneficial Ownership” by a Person of any securities includes ownership by any Person who, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, has or shares (a) voting power which includes the power to vote, or to direct the voting of, such security; and/or (b) investment power which includes the power to dispose, or to direct the disposition, of such security; and shall otherwise be interpreted in accordance with the term “beneficial ownership” as defined in Rule 13d-3 adopted by the SEC under the Exchange Act. The terms “Beneficially Own” and “Beneficial Owner” shall have a correlative meaning.

“Board” means, as of any date, the Management Board of the Company in office on that date.

“Board Observer” has the meaning assigned in Section 4.02(a).

“Business Day” shall mean any day other than a Saturday, Sunday or a day on which all banking institutions in New York, New York are authorized or obligated by Law or executive order to close.

“change of control” means any transaction or series of related transactions that results in, or that is in connection with, any one of the following with respect to the Majority Shareholder or any Person controlling the Majority Shareholder:

(a) any Third Party Purchaser or “group” (within the meaning of Section 13(d)(3) of the Exchange Act) of Third Party Purchasers acquiring, directly or indirectly, (i) Beneficial Ownership of a majority of the total voting power of the voting securities of such Person, or (ii) the power to elect a majority of the board of directors of such Person;

(b) individuals who on the date hereof constitute the board of directors of the Ultimate Parent Entity of such Person (together with any new directors whose election by such board or whose nomination for election by the shareholders of such Ultimate Parent Entity was approved by a vote of a majority of the directors of such Ultimate Parent Entity then still in office who were either directors of such Ultimate Parent Entity on the date hereof or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the board of directors then in office;

(c) the adoption of a plan relating to the liquidation or dissolution of such Parent; or

(d)(i) the merger or consolidation of such Person with or into a Third Party Purchaser or the merger of a Third Party Purchaser with or into such Person, or (ii) the sale, lease, exchange, conveyance, transfer or other disposition by Parent or any of its Subsidiaries (for cash, shares of stock, securities or other consideration) of a direct or indirect interest in the property and assets of the Company and its Subsidiaries, on a consolidated basis, to any Third Party Purchaser or “group” (within the meaning of Section 13(d)(3) of the Exchange Act) of Third Party Purchasers (other than a Transfer to which Section 3.02 is applicable).

“Change of Control Notice” has the meaning assigned in Section 3.03(b).

“Change of Control Put Option” has the meaning assigned in Section 3.03(a).

“Charter Documents” means any by-laws, charter, memorandum, certificate of incorporation, articles of association, or other similar document (including, in respect of the Company, the Company Articles).

“Class B Shares” means the ordinary class B shares of the Company, which shall be entitled to one (1) vote per share.

“Common Shares” means the Subject Shares, the Class B Shares, and any other class of ordinary shares of the Company issued in accordance with the Company Articles.

“Company” has the meaning assigned in the recitals.

“Company Articles” means the Articles of Association of the Company dated as of July 3, 2008, as they may be amended from time to time.

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“Company Joinder” shall mean a joinder agreement executed by the Company in accordance with Section 5.06.

“Company Owned IP” means all Intellectual Property Rights owned or purported to be owned by the Company or any of its Subsidiaries.

“Consent Action” has the meaning assigned in Section 4.01.

“Contract” means any binding contract, agreement, arrangement, understanding, commitment, franchise, indenture, lease, purchase order or license, whether written or otherwise.

“Conversion Agreement” has the meaning assigned in the SPA.

“Core Petrodelta Documents” has the meaning assigned in the SPA.

“Director” means any member of the Board.

“Equity Interests” means, with respect to any Person, shares of capital stock of (or other ownership or profit interests in) such Person, warrants, options or other rights for the purchase or other acquisition of shares of capital stock of (or other ownership or profit interests in) such Person, securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or other acquisition from such Person of such securities (or such other interests), and other ownership or profit interests in such Person (including partnership, limited liability company, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are authorized or otherwise existing on any date of determination.

“Escrow Account” means the escrow account established pursuant to the Escrow Agreement.

“Escrow Agent” means a reputable bank or trust company, reasonably acceptable to the Minority Shareholder, chosen by the Majority Shareholder to act as escrow agent under the Escrow Agreement.

“Escrow Agreement” means an escrow agreement containing customary terms for similar agreements and reflecting the terms of Section 3.04(a).

“Escrow Commencement Date” has the meaning assigned in Section 3.04(d).

“Escrow Fund” has the meaning assigned in Section 3.04(a).

“Escrow Period” has the meaning assigned in Section 3.04(d)(ii).

“Exchange Act” means the United States Securities Exchange Act of 1934, as amended.

“Fair Market Value” has the meaning assigned in Section 3.06(c).

“Fair Market Determination” has the meaning assigned in Section 3.04(b).

“Fair Market Value Request” has the meaning assigned in Section 3.06(a).

“Final Closing” has the meaning assigned in the SPA.

“Final Exercise Date” has the meaning assigned in Section 3.04(e).

“Financial Statements” in respect of a period, means a profit and loss account and statement of cash flows for that period and a balance sheet as at the end of such period together with the associated notes under applicable accounting principles for the Company or a Subsidiary of the Company, as the case may be.

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“GAAP” has the meaning assigned in Section 5.01(b).

“Governmental Authority” means any supranational, United States (federal, state or local), or foreign government, or any political subdivision thereof, or any governmental, regulatory, judicial or administrative authority, agency, board, bureau, commission or similar authority.

“Group Companies” means the Company and its Subsidiaries (which, as of the date hereof, consist of HNR Finance B.V., Harvest Vinccler Ltd. and Harvest-Vinccler, S.C.A.) and Petrodelta and its Subsidiaries.

“IFRS” means International Financial Reporting Standards.

“Indebtedness” means with respect to any Person, without duplication: (a) any obligations for borrowed money, (b) any obligations evidenced by bonds, notes, debentures, letters of credit or similar instruments, (c) any obligations under conditional sale, title retention or similar agreements or arrangements creating an obligation with respect to the deferred purchase price of property, securities or other assets (including “earn-out” payments), (d) any obligations relating to advance payments for goods or services, (e) any capital lease obligations, (f) any net obligations in respect of interest rate, currency or commodity swaps, collars, caps, hedges, futures contract, forward contract, option or other derivative instruments or arrangements, (g) any accrued interest, premiums, penalties, breakages, “make whole amounts” and other obligations relating to the foregoing that would be payable in connection with the repayment of the foregoing, and (h) any obligations to guarantee any of the foregoing types of obligations on behalf of any Person; provided, however, that “Indebtedness” shall not be deemed to include any intercompany Indebtedness owing by the Company or any of its Wholly Owned Subsidiaries to the Company or any other of its Wholly Owned Subsidiaries.

“Initial Closing” has the meaning assigned in the SPA.

“Intellectual Property Rights” means all industrial and intellectual property and other similar proprietary rights, in any jurisdiction, whether registered or unregistered, including all rights in and to (i) patents, patent applications, invention disclosures and utility models, (ii) trademarks, service marks, logos, trade dress, trade names, corporate names and all other designations of origin, together with the goodwill symbolized by any of the foregoing, (iii) moral rights, copyrights, designs and copyrightable subject matter, (iv) rights in computer programs and software (whether in source code, object code, or other form), (v) trade secrets and rights in other confidential information, including rights in ideas, proprietary information, know-how, inventions (whether patentable or unpatentable and whether or not reduced to practice), invention disclosures, improvements, proprietary processes, technology, technical data, algorithms, specifications, formulae, models, and methodologies, customer lists and supplier lists, and industrial designs, (vi) Internet domain names and (vii) all applications and registrations for the foregoing.

“Laws” means any and all domestic (federal, state or local), tribal or foreign laws, rules, regulations, orders, judgments or decrees promulgated by any Governmental Authority.

“Lien” means liens (statutory or other), claims, mortgages, encumbrances, pledges, security interests (including, in respect of shares, depositary receipts for such shares having been issued), easements, rights-of-way, claims, covenants, conditions, restrictions (including transfer restrictions), options, rights of first offer or refusal, third-party rights, limitations on voting rights, encroachments, title defects or charges of any kind or nature whatsoever, whether secured or unsecured, choate or inchoate, filed or unfiled, scheduled or unscheduled, recorded or unrecorded, contingent or non-contingent, material or non-material, known or unknown.

“Litigation Event” means (a) the written assertion by the Company or any Subsidiary of the Company of a claim for compensation as a result of a default, breach or other violation of rights under the Core Petrodelta Documents or otherwise in connection with the Company and its Subsidiaries’ investment in Petrodelta, (b) the exercise of or written threat to exercise any remedies or (c) the commencement of or written threat to commence

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by the Company or any Subsidiary of the Company any Adversary Proceeding, in each case under clause (a), (b) and (c) made to or against Petrodelta, any Affiliate of Petrodelta or any Governmental Authority of Venezuela.

“Litigation Notice” has the meaning assigned in Section 3.04(a).

“Litigation Notice Date” has the meaning assigned in Section 3.04(b).

“Litigation Put Option” has the meaning assigned in Section 3.04(e).

“Litigation Withdrawal Notice” has the meaning assigned in Section 3.04(e)

“Majority Shareholder” has the meaning assigned in the preamble.

“Minority Shareholder” has the meaning assigned in the preamble.

“Necessary Action” means, with respect to a result required to be caused, all actions (to the extent such actions are permitted by applicable Law) reasonably necessary to cause such result, which actions may include, without limitation, (a) voting or providing a written consent or proxy with respect to the Common Shares, (b) causing the adoption of shareholders resolutions and amendments to the Charter Documents of the Company or any of its Subsidiaries, (c) causing members of the Board or the board of directors of a Subsidiary of the Company (to the extent such members were nominated or designated by the Person obligated to undertake the Necessary Action and subject to any fiduciary duties that they may have as directors) to act in a certain manner or causing them to be removed in the event they do not act in such a manner (without regard to whether such failure to act is due to the fiduciary duty referred to above), (d) executing agreements and instruments, and (e) making, or causing to be made, with Governmental Authorities or other Persons, all filings, approvals, registrations or similar actions that are required to achieve such result.

“O&G Tech” means Oil & Gas Technology Consultants (Netherlands) Coöperatie U.A., a cooperative (coöperatie) incorporated under the laws of the Netherlands.

“Parent” has the meaning assigned in the recitals.

“Periodic Tax Return” shall mean a Tax Return which is required to be filed by applicable Law less than ninety (90) days (inclusive of any applicable extensions which do not result in additional Taxes payable) after the end of the taxable period to which it relates.

“Permits” means any and all permits, authorizations, approvals, registrations, certificates, orders, waivers, variances or other approvals and licenses relating to compliance with any Law.

“Permitted Transferee” has the meaning assigned in Section 3.05(a).

“Person” means any individual, firm, partnership, corporation, trust, joint venture, association, joint stock company, limited liability company, unincorporated organization or any other entity or organization, including a government or agency or political subdivision thereof, and shall include any successor (by merger or otherwise) of such entity.

“Petrodelta” means Petrodelta S.A.

“Petrodelta Venezuelan National Assembly Approval” has the meaning assigned in the SPA.

“Put Commencement Date” has the meaning assigned in Section 3.04(c).

“Put Contract” means a Contract in the form set forth as Exhibit C hereto.

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“Qualified Affiliate” means, with respect to any Person, (a) the Ultimate Parent Entity of such Person or (b) any Wholly Owned Subsidiary of the Ultimate Parent Entity of such Person.

“Referee” has the meaning assigned in Section 6.03.

“Related Agreements” means the SPA (including the Exhibits, Schedules, Annexes and Appendices thereto and other documents delivered pursuant thereto), the Buyer Disclosure Schedule and Seller Disclosure Schedule (each as defined in the SPA), the Ancillary Agreement and the Parent Guarantee.

“Restricted Date” has the meaning assigned in Section 3.04(d).

“Sale Transaction” has the meaning assigned in Section 5.07.

“SEC” means the Securities and Exchange Commission.

“Shareholder Joinder” means a joinder agreement, substantially in the form of Exhibit A attached hereto, executed by a Person, other than a current Shareholder, who has acquired Subject Shares from a Shareholder or a Permitted Transferee thereof, with the effect that the holder thereafter shall be deemed to be the Majority Shareholder (if a transferee of the Majority Shareholder or one of its Permitted Transferees) or the Minority Shareholder (if a transferee of the Minority Shareholder), as the case may be, for all purposes of this Agreement.

“Shareholders” means the Majority Shareholder, any of its Permitted Transferees, the Minority Shareholder and such other Persons who have executed a Shareholder Joinder; provided, that any such Person shall cease to be a Shareholder at such time after the effectiveness of this agreement as it no longer has legal ownership or Beneficial Ownership of any Subject Shares and thereafter such Person shall have no powers, rights or privileges as a Shareholder hereunder.

“SPA” has the meaning assigned in the recitals.

“Subject Shares” means ordinary class A shares of the Company, which shall be entitled to one (1) vote per share, or any Equity Interest in the Company issued in respect thereof.

“Subject Shares Purchase Price” has the meaning assigned in Section 3.04(a).

“Subsidiary” means, with respect to any Person, any other entity (a) whose securities or other ownership interests, having by their terms the power to elect a majority of the board of directors or other Persons performing similar functions, are owned or controlled, directly or indirectly, by such Person, (b) whose business and policies such Person has the power, directly or indirectly, to direct, or (c) of which 50% or more of the securities, partnership or other ownership interests are owned, directly or indirectly, by such Person.

“Superior Proposal” has the meaning assigned in the SPA.

“Tag-Along Notice” has the meaning assigned in Section 3.02(a).

“Tag Right” has the meaning assigned in Section 3.02(c).

“Tax” means any and all taxes, assessments, fees, levies, duties, tariffs, imposts, and other similar charges (together with any and all interest, penalties, additions to tax, additional amounts in respect of the foregoing, and any obligations or payments to any Person with respect to any of the foregoing) imposed by any Taxing Authority including taxes or other charges on or with respect to income, franchises, windfall or other profits, gross receipts, property, sales, use, capital stock, payroll, employment, social security, workers’

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compensation, unemployment compensation, or net worth; taxes or other charges in the nature of excise, withholding, ad valorem, stamp, transfer, value added, or gains taxes; license, registration and documentation fees; customs’ duties, tariffs, and similar charges; and with respect to Venezuela including but not limited to the royalties and taxes provided for in the Organic Hydrocarbons Law (Official Gazette of August 4, 2006), the special contribution provided for in the “Ley que crea Contribución Especial por Precios Extraordinarios y Precios Exorbitantes en el Mercado Internacional de Hidrocarburos” (Official Gazette of February 20, 2013) and the special contribution provided for in the Petrodelta Venezuelan National Assembly Approval.

“Tax Return” means any return, declaration, report information statement, claim for refund or other document, including any schedule or attachment thereto, filed or required to be filed with any Governmental Authority in connection with the determination, assessment or collection of any Tax of any party or the administration of any laws, regulations or administrative requirements relating to any Tax.

“Taxing Authority” means any Governmental Authority having the power to impose or collect Tax.

“Technical Expert” has the meaning assigned in Section 3.06(a).

“Third Party Purchaser” means any Person who is not now, and immediately prior to the contemplated transaction will not be, a Shareholder or an Affiliate thereof.

“Transfer” means any direct or indirect sale, transfer, assignment, lease, issuance, pledge, exchange, hypothecation, mortgage, license, gift, creation of a security interest in or Lien on, placement in trust (voting or otherwise), encumbrance or other disposition to any Person, whether voluntary or involuntary, including by way of spin-off, operation or succession of law or merger, hedging or derivative transactions or any transaction which is designed to, or might reasonably be expected to, result in a disposition (whether by actual disposition or effective economic disposition due to cash settlement or otherwise).

“Ultimate Parent Entity” means, (a) for the Majority Shareholder, Parent and (b) with respect to any direct or indirect third party transferee of Subject Shares, an Affiliate of such transferee that controls such transferee and is not controlled (as such terms “control” and “controlled” are defined under the definition of Affiliate) by any other Person.

“VAT Fiscal Unity” shall mean the fiscal unity (fiscal eenheid) between Majority Shareholder and the Company or any of its Subsidiaries pursuant to article 7(4) of the 1968 Value Added Tax Act (Wet op de omzetbelasting 1968) or any other consolidated group for value added tax purposes between the Majority Shareholder or a related party and the Company or any of its Subsidiaries.

“Venezuela” means the Bolivarian Republic of Venezuela.

“Wholly Owned Subsidiary” means, with respect to any Person, any Subsidiary that is a wholly owned Subsidiary of such Person. As used herein, “wholly owned” means direct or indirect ownership of any and all of the Equity Interests of such Person.

Section 1.02 General Interpretive Principles. Whenever used in this Agreement, except as otherwise expressly provided or unless the context otherwise requires, any noun or pronoun shall be deemed to include the plural as well as the singular and to cover all genders. Unless otherwise specified, words such as “herein”, “hereof”, “hereby”, “hereunder” and words of similar import refer to this Agreement as a whole and not to any particular Section or subsection of this Agreement, and references herein to “Articles” or “Sections” refer to Articles or Sections of this Agreement. In the event that any translated versions of this Agreement differ from the English version, the English version shall control. The headings in this Agreement are intended solely for convenience of reference and shall be given no effect in the construction or interpretation of this Agreement.

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ARTICLE II

REPRESENTATIONS AND WARRANTIES

Section 2.01 Representations and Warranties of All Parties. Each of the parties hereto hereby represents and warrants to the others on the date hereof as follows:

(a) Organization; Authority; Enforceability. Such party is a corporation or legal entity duly organized or formed, validly existing and (to the extent applicable) in good standing, under the laws of its jurisdiction of organization or formation and has the requisite corporate or similar entity power and authority to conduct its business as it is now being conducted. Such party has all necessary corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder and to consummate the transactions contemplated hereby. The execution and delivery of this Agreement by such party and the consummation by such party of the transactions contemplated hereby have been duly and validly authorized by all necessary corporate action, and no other corporate proceedings on the part of such party are necessary to authorize the execution and delivery of this Agreement or to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by such party and, assuming the due authorization, execution and delivery by each other party, constitutes a legal, valid and binding obligation of such party, enforceable against such party in accordance with its terms (except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similar laws of general applicability relating to or affecting creditor’s rights, and subject to general equitable principles).

(b) No Breach. None of the execution and delivery of this Agreement, the consummation by such party of the transactions contemplated by this Agreement or the performance by such party of its obligations hereunder will (i) conflict with or violate its Charter Documents, (ii) conflict with or violate any Law applicable to such party or by which any property or asset of such party is bound or affected or (iii) result in any breach of, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any right of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien upon any of the properties or assets of such party pursuant to, any Contract or any Permits to which it is a party or by which it or any of its assets or operations are bound or affected.

(c) Consents. No consent, waiver, approval, authorization, exemption, registration, license or declaration is required to be made or obtained by such party in connection with (i) the execution, delivery or enforceability of this Agreement or (ii) the consummation of any of the transactions contemplated herein.

(d) Compliance with Law. Each of such party, its Affiliates, such party’s and its Affiliates’ respective assets, and such party’s and its Affiliates’ respective business and record keeping practices is not currently in violation of any Law which violations could at any time (including, without limitation, after the Final Closing) have a material adverse effect upon (i) such party or its Affiliates, (ii) such party’s ability to perform its obligations hereunder or (iii) any of the other parties hereto.

ARTICLE III

TRANSFER RESTRICTIONS

Section 3.01 General Transfer Restrictions. The Majority Shareholder may not Transfer any of its Subject Shares at any time to any Person except (a) in a direct sale of Subject Shares in accordance with Section 3.02, (b) as a result of a change of control in accordance with Section 3.03, (c) in connection with a proposed Litigation Event in accordance with Section 3.04 or (d) to a Permitted Transferee in accordance with Section 3.05, and in each case in compliance with all applicable Law; provided that, for the avoidance of doubt, no transfer restrictions set forth in this Article III shall apply to the consummation of a Superior Proposal in accordance with the terms of the SPA. The Minority Shareholder may Transfer all but not less than all of its Subject Shares at any time in accordance with all applicable Law to any Person that has executed a Shareholder Joinder substantially in the form attached hereto as Exhibit A, pursuant to which such Person will thereby

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become a party to, and be bound by and obligated to comply with the terms and conditions of, this Agreement, as if such Person were the Minority Shareholder. Any Transfer of any Subject Shares that is not in compliance with the provisions of this Article III is prohibited and shall be null and void, and the parties hereto shall take all Necessary Action to ensure that it is not approved by the shareholders of the Company (to the extent any such approval is required), not recorded on the shareholder registry of the Company and not recognized by the Company. If, notwithstanding the immediately preceding sentence, any Transfer of any Subject Shares is held by a court of competent jurisdiction to be effective, then the restrictions on Transfer of any Subject Shares under this Article III applicable to the transferor shall apply to the transferee and to any subsequent transferee as if such transferee were a party hereto. Each Shareholder shall, and shall cause the Company to, take all Necessary Actions to give full effect to the Transfer of any Shares that is effected in accordance with the provisions of this Agreement. Any transferee of the Minority Shareholder that becomes a party to this Agreement shall enjoy the same rights and be subject to the same obligations as the Minority Shareholder hereunder with respect to the Subject Shares transferred to such transferee. Any transferee of the Majority Shareholder that becomes a party to this Agreement shall be subject to the same obligations of the Majority Shareholder hereunder with respect to the Subject Shares Transferred to such transferee.

Section 3.02 Tag-Along.

(a) If at any time the Majority Shareholder receives a binding offer from any Third Party Purchaser to purchase Subject Shares owned by the Majority Shareholder, that it is willing to accept, the Majority Shareholder may effect such Transfer only if (i) such Transfer (A) is a sale to a Third Party Purchaser for cash consideration only and, (B) is for all but not less than all Subject Shares owned by the Majority Shareholder and its Affiliates, and (ii) the Majority Shareholder has complied with this Section 3.02. The Majority Shareholder shall, within three (3) Business Days of receipt of such a binding offer from the Third Party Purchaser, give notice in writing (the “Tag-Along Notice”) to the Minority Shareholder of the proposed sale and of the terms and conditions of such proposed sale in the manner set forth in Section 3.02(b) below.

(b) The Tag-Along Notice shall include the following:

(i) a copy of the Third Party Purchaser’s offer (including all documentation relating thereto) and, to the extent not specified in such copy, the identity of the Third Party Purchaser, including the entity that would become the Ultimate Parent Entity if the sale is consummated;

(ii) the date, time and location upon which the sale is proposed to be made, which shall not be earlier than thirty (30) days or later than fourteen (14) months after the date of such Tag-Along Notice; and

(iii) the cash consideration offered and all other material terms.

(c) The Minority Shareholder, by notice to the Majority Shareholder within thirty (30) days after receipt of the Tag-Along Notice, shall have the opportunity to sell all but not less than all of its Subject Shares to the Third Party Purchaser specified in the Tag-Along Notice in accordance with Section 3.02(d) (a “Tag Right”). If the Minority Shareholder does not elect to exercise its Tag Right, the Majority Shareholder may proceed to complete the sale of all but not less than all of its Subject Shares to the Third Party Purchaser specified in the Tag-Along Notice in accordance with the proposed terms and conditions of such offer; provided, however, that the closing of any such sale shall occur not more than sixty (60) days after the receipt of all necessary approvals from any Governmental Authority but in no event shall occur more than fourteen (14) months after the Minority Shareholder’s receipt of the Tag-Along Notice; provided, further, that if no approvals from any Governmental Authority are necessary to effect such closing, such closing shall not occur more than sixty (60) days after the Minority Shareholder’s receipt of the Tag-Along Notice. Prior to the consummation of and as a condition to such sale, the Majority Shareholder shall require (i) the Third Party Purchaser to execute a Shareholder Joinder substantially in the form of Exhibit A, pursuant to which such Person will thereby become a party to, and be bound by and obligated to comply with the terms and conditions of, this Agreement as if such Person were the Majority Shareholder, and (ii) the Ultimate Parent Entity of such Third Party Purchaser to execute and deliver a

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guarantee substantially in the form attached hereto as Exhibit B. If the sale is not completed within the time period required by this Section 3.02(c), the provisions of this Section 3.02 shall again apply and no Transfer may be made in reliance upon this Section without again complying with its provisions. Any material amendment of the terms of a Third Party Purchaser’s offer from those specified in the Tag-Along Notice shall require a new Tag-Along Notice and any rights or obligations under this Section 3.02 shall be in relation to such new Tag-Along Notice. The Majority Shareholder shall provide to the Minority Shareholder copies of the final documentation relating to such sale not less than five (5) days prior to the closing of such sale.

(d) If the Minority Shareholder exercises its Tag Right, the Minority Shareholder shall be entitled to sell all but not less than all its Subject Shares in connection therewith for the same per share price and on the same terms and conditions specified in the Tag-Along Notice as the Majority Shareholder, which terms and conditions shall be at least as favorable for the Minority Shareholder as those terms and conditions specified in the Tag-Along Notice; provided that the Minority Shareholder shall have no obligation to make any representations or warranties or provide any indemnity in connection with such sale, except in respect of title to the Subject Shares, due authorization and similar fundamental corporate matters. The Majority Shareholder shall not consummate the proposed sale unless all of the Subject Shares entitled to be sold by the Minority Shareholder pursuant to this Section 3.02 are simultaneously sold in accordance with the terms hereof. Any such sale of Subject Shares shall close at a time and place specified by the Majority Shareholder and reasonably acceptable to the Minority Shareholder; provided, however, that such closing shall occur not more than sixty (60) days after the receipt of all necessary approvals from any Governmental Authority but in no event shall occur more than fourteen (14) months after the Minority Shareholder’s receipt of the Tag-Along Notice; provided, further, that if no approvals from any Governmental Authority are necessary to effect such closing, such closing shall not occur more than sixty (60) days after the Minority Shareholder’s receipt of the Tag-Along Notice.

Section 3.03 Change of Control Put Option.

(a) In connection with any change of control of the Majority Shareholder, the Minority Shareholder shall have the right and option, exercisable upon written notice to the Majority Shareholder in accordance with Section 3.03(c), to sell to the Majority Shareholder and to cause the Majority Shareholder to purchase all but not less than all of the Minority Shareholder’s Subject Shares pursuant to the Put Contract (a “Change of Control Put Option”), for an aggregate purchase price equal to the Fair Market Value of the Minority Shareholder’s Subject Shares determined in accordance with Section 3.06.

(b) At least ninety days (90) days prior to the consummation of any transaction that would result in a change of control of the Majority Shareholder (or as promptly as practicable after consummation, in the case of any change of control under clause (a) or (b) of the definition thereof), the Majority Shareholder shall deliver a notice thereof (a “Change of Control Notice”) to the Minority Shareholder, which notice shall contain: (i) the identity of the Person that will directly or indirectly control the Majority Shareholder upon the consummation of the change of control transaction and of the Ultimate Parent Entity of such Person; (ii) the date upon which the change of control transaction is proposed to be consummated; and (iii) the consideration and all other material terms of the proposed transaction. From the date of the Change of Control Notice through the date of the closing of such change of control transaction, the Majority Shareholder shall promptly provide the Minority Shareholder with all information about the change of control transaction as is reasonably requested by the Minority Shareholder, including, without limitation, information about the Person that will directly or indirectly control the Majority Shareholder and the Ultimate Parent Entity of such Person.

(c) Within fifteen (15) days of the date of the Change of Control Notice, the Minority Shareholder may request that a determination of the Fair Market Value of its Subject Shares be made pursuant to Section 3.06. Following determination of the Fair Market Value of its Subject Shares in accordance with Section 3.06, the Minority Shareholder shall have the right to exercise the Change of Control Put Option by providing notice to the Majority Shareholder no later than fifteen (15) days after the date of such determination. In the event of exercise of the Change of Control Put Option, the Majority Shareholder shall purchase, or shall cause to be purchased, all of the Subject Shares of the Minority Shareholder for the Fair Market Value

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determined in accordance with Section 3.06. The closing of such purchase shall occur, (i) in the case of any change of control under clause (c) or (d) of the definition thereof, simultaneously with and as a condition to such change of control of the Majority Shareholder, and (ii) in the case of any other change of control not involving a change of control under clause (c) or (d) of the definition thereof, not more than sixty (60) days after the receipt of all necessary approvals from any Governmental Authority but in no event more than fourteen (14) months after the Minority Shareholder’s exercise of the Change of Control Put Option; provided, that if no approvals from any Governmental Authority are necessary, such closing shall not occur more than sixty (60) days after the Minority Shareholder’s exercise of the Change of Control Put Option.

(d) If in connection with a change of control the Minority Shareholder does not elect to exercise the Change of Control Put Option, then prior to the consummation of and as a condition to any such change of control, the Majority Shareholder shall require the Ultimate Parent Entity of the Person that will directly or indirectly control the Majority Shareholder upon the consummation of the change of control transaction to execute and deliver a guarantee substantially in the form attached hereto as Exhibit B.

(e) If the change of control notified in a Change of Control Notice does not occur within fourteen (14) months of such notice, the provisions of this Section 3.03 shall again apply and no Transfer may be made in reliance upon this Section without again complying with its provisions. Any material amendment of the terms of a change of control from those specified in a Change of Control Notice shall require a new Change of Control Notice and any rights or obligations under this Section 3.03 shall be in relation to such new Change of Control Notice; provided that the Minority Shareholder shall have fifteen (15) days from the date of such new Change of Control Notice to exercise the Change of Control Put Option.

Section 3.04 Litigation Put Option.

(a) Prior to the commencement of any Litigation Event, the Majority Shareholder shall deliver a notice (a “Litigation Notice”) to the Minority Shareholder that the Majority Lender intends to cause the Company or a Subsidiary of the Company to commence a Litigation Event, describing in reasonable detail the facts and circumstances giving rise to such potential Litigation Event and the potential actions contemplated to be taken in respect thereof. Following the sending of the Litigation Notice, the Majority Shareholder and the Minority Shareholder shall mutually select an Escrow Agent and execute the Escrow Agreement. Within five (5) Business Days of the execution of the Escrow Agreement, the Majority Shareholder shall deposit or cause to be deposited $5,000,000 into the Escrow Account. All costs associated with the Escrow Agent, the Escrow Agreement and the Escrow Account shall be shared equally by the Majority Shareholder and the Minority Shareholder.

(b) Within fifteen (15) days of delivery of the Litigation Notice (the date of such delivery being the “Litigation Notice Date”), the Minority Shareholder may, by written notice to the Majority Shareholder, request that a determination of the Fair Market Value of its Subject Shares be determined pursuant to Section 3.06 (a “Fair Market Value Determination”). If the Minority Shareholder does not request a Fair Market Value Determination, all amounts in the Escrow Account shall be promptly returned to the Majority Shareholder.

(c) If the Minority Shareholder requests a Fair Market Value Determination (the date of such request being the “Put Commencement Date”), the Majority Shareholder shall, within ten (10) Business Days of the determination of the Fair Market Value of the Minority Shareholder’s Subject Shares pursuant to Section 3.06 deposit or cause to be deposited into the Escrow Account such additional amounts, if any, as may be required to make the amount in the Escrow Account to be equal to the Fair Market Value of the Minority Shareholder’s Subject Shares. If the Fair Market Value of the Minority Shareholder’s Subject Shares is less than the amount in the Escrow Account, such excess shall be promptly returned to the Majority Shareholder.

(d) Until (i) the date fifteen (15) days after the Litigation Notice Date if the Minority Shareholder does not request a Fair Market Value Determination, or (ii) the date (the “Escrow Commencement Date”) on which an amount equal to the Fair Market Value of the Minority Shareholder’s Subject Shares is deposited in the

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Escrow Account if the Minority Shareholder requests a Fair Market Value Determination, the Majority Shareholder shall not permit the Company or any Subsidiary of the Company to commence any Litigation Event.

(i) If the Minority Shareholder does not request a Fair Market Value Determination, the Majority Shareholder may cause the Company or any Subsidiary of the Company to commence a Litigation Event contemplated by the Litigation Notice delivered in respect thereof without the consent of the Minority Shareholder (but subject to the Company Articles and the other provisions of this Agreement, including Sections 5.01, 5.03 and 5.04) at any time after the date fifteen (15) days after the Litigation Notice Date and prior to the one (1) year anniversary of the Litigation Notice Date, and the Minority Shareholder shall not have a Litigation Put Option during such period. If prior to the one (1) year anniversary of the Litigation Notice Date no Adversary Proceeding in respect of the Litigation Event contemplated by the Litigation Notice has been commenced by the Company or any of its Subsidiaries against Petrodelta, any Affiliate of Petrodelta or any Governmental Authority of Venezuela through the issuance of a demand for arbitration, the filing or service of a complaint or other similar action or process, the Majority Shareholder shall not permit the Company or any Subsidiary of the Company to commence a Litigation Event without the prior written consent of the Minority Shareholder until the second anniversary of the Litigation Notice Date and, thereafter, the Majority Shareholder shall not permit the Company or any Subsidiary of the Company to commence any Litigation Event without providing the Minority Shareholder with a Litigation Notice and complying with the terms of this Section 3.04.

(ii) If the Minority Shareholder requests a Fair Market Value Determination, the Majority Shareholder may, upon five (5) days prior written notice to the Minority Shareholder, cause the Company or any Subsidiary of the Company to commence a Litigation Event contemplated by the Litigation Notice delivered in respect thereof at any time during the period (the “Escrow Period”) after the Escrow Commencement Date and before the earlier of the one (1) year anniversary of the Litigation Notice Date or the Litigation Withdrawal Date. If during the Escrow Period no Adversary Proceeding in respect of the Litigation Event contemplated by the Litigation Notice has been commenced by the Company or any of its Subsidiaries against Petrodelta, any Affiliate of Petrodelta or any Governmental Authority of Venezuela through the issuance of a demand for arbitration, the filing or service of a complaint or other similar action or process, the Majority Shareholder shall not permit the Company or any Subsidiary of the Company to commence a Litigation Event without the prior written consent of the Minority Shareholder for one (1) year after the end of the Escrow Period and, thereafter, the Majority Shareholder shall not permit the Company or any Subsidiary of the Company to commence any Litigation Event without providing the Minority Shareholder with a Litigation Notice and complying with the terms of this Section 3.04.

(e) The Minority Shareholder shall have the right and option, exercisable upon written notice to the Majority Shareholder during the period commencing on the Put Commencement Date and ending on the date occurring (such date being the “Final Exercise Date”) thirty (30) days after the earliest of (x) the date on which the Majority Shareholder provides the Minority Shareholder with written notice that an Adversary Proceeding in respect of the Litigation Event contemplated by the Litigation Notice has been commenced by the Company or any of its Subsidiaries against Petrodelta, any Affiliate of Petrodelta or any Governmental Authority of Venezuela through the issuance of a demand for arbitration, the filing or service of a complaint or other similar action or process, (y) the date on which the Majority Shareholder provides the Minority Shareholder with written notice that the Majority Shareholder has caused the Company and each Subsidiary of the Company to withdraw any pending Litigation Events and will not cause the Company or any Subsidiary of the Company to commence any new Litigation Event within the one (1) year period following the date of such notice without the prior written consent of the Minority Shareholder (the Litigation Withdrawal Notice”) and (z) the one (1) year anniversary of the Litigation Notice, to sell to the Majority Shareholder, and to cause the Majority Shareholder to purchase from the Minority Shareholder, all but not less than all of the Minority Shareholder’s Subject Shares (the “Litigation Put Option”) for an aggregate purchase price equal to the Fair Market Value of the Minority Shareholder’s Subject Shares determine pursuant to Section 3.06. In the event that the Minority Shareholder exercises the Litigation Put Option, (i) the parties shall execute the Put Contract (which shall provide that the purchase price shall be paid out of the Escrow Account and that all funds remaining in the Escrow Account after

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the payment of the purchase price shall be returned to the Majority Shareholder) as promptly as practicable and (ii) the Majority Shareholder shall purchase, or cause to be purchased, all of the Minority Shareholder’s Subject Shares within thirty (30) days of the later of the exercise of the Litigation Put Option and the determination of Fair Market Value pursuant to Section 3.06. If the Minority Shareholder does not exercise the Litigation Put Option by the Final Exercise Date, all amounts in the Escrow Account shall be promptly returned to the Majority Shareholder.

Section 3.05 Permitted Transfers; Transfer Approval.

(a) The Majority Shareholder may effect a Transfer of all but not less than all of its Subject Shares to any Person that is one of its Qualified Affiliates (a “Permitted Transferee”) at any time without complying with the provisions of Section 3.02; provided that (i) the Majority Shareholder provides at least fifteen (15) days’ advance notice to the Minority Shareholder and, (ii) prior to the consummation of and as a condition to such Transfer, the Permitted Transferee of such Subject Shares executes a Shareholder Joinder substantially in the form attached hereto as Exhibit A, pursuant to which such Person will thereby become a party to, and be bound by and obligated to comply with the terms and conditions of, this Agreement as if such Person were the Majority Shareholder. Before such Permitted Transferee ceases to be a Qualified Affiliate of the Majority Shareholder, it shall Transfer, in a manner permitted by this Agreement, all the Subject Shares held by it back to the Majority Shareholder or another Qualified Affiliate of the Majority Shareholder that shall remain a Qualified Affiliate after such Transfer.

(b) The Majority Shareholder shall take all Necessary Action to approve, in accordance with the Company Articles, any Transfer by the Minority Shareholder in accordance with this Agreement of any or all of its Subject Shares to any Person.

Section 3.06 Fair Market Value Determination.

(a) In the event that a Change of Control Notice is delivered pursuant to Section 3.03(b) or a Claim Notice is delivered pursuant to Section 3.04(a) and the Minority Shareholder requests, by written notice to the Majority Shareholder delivered within fifteen (15) days after receipt of such Change of Control Notice or Litigation Notice, a determination of the Fair Market Value of Subject Shares (the “Fair Market Value Request”), then the Shareholders shall seek to agree on the appointment of an independent third party investment bank to act as an appraiser (the “Appraiser”), which shall select a reputable independent technical expert (the “Technical Expert”) to assist with its determination of the Fair Market Value of the Subject Shares. In the event the Shareholders fail to reach an agreement on the appointment of the Appraiser within fifteen (15) days of the Minority Shareholder’s Fair Market Value Request, the Shareholders shall request that an independent third party investment bank be appointed by the ICC International Centre for Expertise and such independent third party investment bank so appointed shall act as the Appraiser.

(b) Each Shareholder shall enter into customary engagement letters with the Appraiser and the Technical Expert, which engagement letters shall provide that the fees and expenses of and any indemnity obligations to the Appraiser or the Technical Expert shall be borne fifty percent (50%) by the Majority Shareholder and fifty percent (50%) by the Minority Shareholder on a several, but not joint basis. Each Shareholder shall cooperate with the Appraiser and the Technical Expert as reasonably requested, which cooperation shall include promptly providing any information in its possession reasonably requested by the Appraiser or the Technical Expert.

(c) The Appraiser shall conduct a valuation of the market value of the Subject Shares as promptly as reasonably practicable and, in any event, within thirty (30) days after the appointment of the Appraiser. The Appraiser’s valuation of the fair market value of the Subject Shares shall take into account, to the extent applicable: (i) any dividends declared by the Company, any of its Subsidiaries or Petrodelta after September 30, 2013, which have not been paid by the Company to its shareholders, (ii) the consideration to be paid in a proposed change of control transaction, (iii) the expected realizable value of any claims that are the subject of a

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Litigation Event and (iii) any other factors deemed appropriate by the Appraiser in its discretion. The “Fair Market Value” of the Subject Shares shall be an amount equal to the product of (i) the Appraiser’s valuation of the fair market value of the Subject Shares as a whole, as of the date of delivery of the Change of Control Notice or Claim Notice, as determined in accordance with this Section 3.06, (ii) multiplied by the percentage of Subject Shares then owned by the Minority Shareholder. The determination of the Appraiser of Fair Market Value shall (in the absence of fraud or manifest error) be final and binding.

ARTICLE IV

GOVERNANCE

Section 4.01 Consent Rights. For so long as the Minority Shareholder and its Affiliates own at least twenty-five percent (25%) of the Common Shares, the Majority Shareholder shall take all Necessary Action to cause the Company and its Subsidiaries to refrain from taking any of the following actions or approving any of the following matters (each, a “Consent Action”) without the prior written consent of the Minority Shareholder:

(a) Transfer any assets other than (i) Company Owned IP pursuant to non-exclusive licenses granted to end users in connection with sales of finished products in the ordinary course of business and (ii) dispositions of obsolete equipment or assets in the ordinary course of business consistent with past practice;

(b) guarantee any Indebtedness or assume or guarantee the obligations of any Person other than guarantees of a Wholly Owned Subsidiary of the Company;

(c) loan, advance, invest or make a capital contribution to or in any Person other than (i) a Wholly Owned Subsidiary of the Company or (ii) Petrodelta if and to the extent required to comply with any pro rata funding obligations of the Company or any of its Wholly Owned Subsidiaries in respect of Petrodelta under the terms of the Core Petrodelta Documents or any duly approved Business Plan (as defined in the Conversion Agreement);

(d) waive or release any (i) governmental complaint or (ii) claims, liabilities or obligations arising out of, related to or in connection with litigation other than for compromises, settlements or agreements that involve only the payment of monetary damages not in excess of $500,000 in any single instance and $1,000,000 in the aggregate and in any case without the imposition of equitable relief on, or the admission of wrongdoing by, the Company or any of its Subsidiaries;

(e) the entering into, or commitment to enter into, or undertaking activity in any line of business other than owning and investing in Petrodelta, complying with the terms of the Core Petrodelta Documents and matters ancillary thereto;

(f) the incorporation, formation or the acquisition of any new Subsidiary (other than a Wholly Owned Subsidiary) or interests or assets of any Person (other than the acquisition of interests in a Wholly Owned Subsidiary or in Petrodelta if and to the extent required to comply with the terms of the Core Petrodelta Documents);

(g) the assertion of any claim or commencement of any litigation, arbitration or other proceeding against Petrodelta, any Affiliate of Petrodelta or any Governmental Authority of Venezuela, other than in accordance with Section 3.04(d);

(h) approving the appointment of any new auditor or a change in the existing auditor of the Company or any of its Subsidiaries, other than in respect of the appointment of any new auditor that is the then-current, or is simultaneously appointed to be the, auditor of Parent;

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(i) approving the compensation of or any other fees payable to any Director or any director of a Subsidiary of the Company;

(j) any agreement or other transaction between any Group Company and either (i) Parent or any of its Affiliates (other than any Group Company) or (ii) any director, officer or employee of Parent or any of its Affiliates (other than for compensation of officers or employees of any Group Company in the ordinary course of business); and

(k) the delegation of the authority or powers of the Board to any committee, Person or entity except pursuant to a power of attorney granted to strictly implement resolutions, or carry out any actions, that have been duly authorized by the Board.

Section 4.02 Board Participation. Until such time as the Minority Shareholder has the right to appoint at least one (1) Director, the Majority Shareholder shall:

(a) use its reasonable best efforts to enable a designee of the Minority Shareholder (the “Board Observer”) to attend (in person, or at the election of the Board Observer, by means of a telephonic conference connection) all regular and special meetings of the Board, including all regular and special meetings of any committee of the Board, as an observer and to be given such prior notice of such Board or committee meetings (together with any materials prepared for Directors for such meetings) as are (and at such times as given) to Directors; provided, however, that the Minority Shareholder shall procure that the Board Observer keeps confidential any confidential information received in his or her role as Board Observer and that the Board Observer undertakes to the Company that he or she will do so;

(b) keep the Minority Shareholder reasonably informed of all discussions among and actions taken by the Board and any committee of the Board; and

(c) to the extent not provided under any of the foregoing, promptly provide the Minority Shareholder with copies of all materials distributed to Directors and all minutes of the Board.

ARTICLE V

ADDITIONAL AGREEMENTS

Section 5.01 Information Rights. For so long as the Minority Shareholder and its Affiliates own at least twenty-five percent (25%) of the Common Shares, the Majority Shareholder shall take all Necessary Action to cause the Company to furnish to the Minority Shareholder:

(a) as soon as practicable but not later than ninety (90) days after the end of each fiscal year, copies of audited consolidated Financial Statements of the Company and each of its Subsidiaries for such fiscal year prepared in accordance with United States generally accepted accounting principles (“GAAP”) and United States auditing standards;

(b) as soon as practicable but not later than forty-five (60) days after the end of each fiscal year, a report, for each of the Company and its Subsidiaries, summarizing the operations of the Company and each such Subsidiary conducted during such fiscal year, together with statements of sources and application of funds showing actual expenditures to date, and latest estimates to the fiscal year end;

(c) as soon as practicable but not later than forty-five (60) days after the end of each fiscal quarter, copies of the unaudited consolidated Financial Statements of the Company and each of its Subsidiaries for such fiscal quarter prepared in accordance with GAAP and United States auditing standards and a report, for each of the Company and its Subsidiaries, summarizing the operations of the Company conducted during such fiscal quarter, together with statements of sources and application of funds showing actual expenditures to date, and latest estimates to the fiscal year end;

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(d) as soon as practicable, any correspondence to or from Petrodelta, to or from the auditors of the Company and to or from any Governmental Authority;

(e) as soon as practicable, copies of all Contracts entered into by the Company;

(f) as soon as practicable, copies of and access to complete and accurate statements, of whatever financial, tax, accounting and other information regarding the Company and its Subsidiaries, including information regarding earnings, which the Minority Shareholder or any of its Affiliates is required to file with any Governmental Authority, or which is necessary or required in order to comply with any audit; and

(g) as soon as practicable, such other information relating to the financial condition, business, prospects, or corporate affairs of the Company, any of its Subsidiaries or Petrodelta or any of its Subsidiaries as the Minority Shareholder may from time to time reasonably request;

provided that, if so requested by the Minority Shareholder, the Majority Shareholder shall take all Necessary Action to cause the Company and its Subsidiaries to furnish to the Minority Shareholder the Financial Statements described in clauses (a) and (c) of this Section 5.01 in accordance with IFRS within ninety (90) days of the date of such request; provided, further, that the Minority Shareholder shall bear all out-of-pocket expenses of Parent or its Affiliates that are incurred in connection with the preparation of such Financial Statements in accordance with IFRS to the extent such expenses exceed those that would have been incurred in connection with the preparation of such Financial Statements in accordance with GAAP and United States auditing standards.

Section 5.02 Inspection and Audit Rights. The Majority Shareholder shall take all Necessary Action to cause the Company to permit the Minority Shareholder, through its authorized employees and agents or those of its Affiliates, at its own cost and expense, during normal business hours and upon reasonable notice, to have full access to the Company and its Subsidiaries, all sites, offices and facilities of the Company and its Subsidiaries, and (except as may be limited by Law) the right to examine, make copies of and audit any accounts, records and other documents of the Company and its Subsidiaries. The Majority Shareholder shall further use its reasonable best efforts to permit the Minority Shareholder, through its authorized employees and agents or those of its Affiliates, to conduct any of the foregoing inspection and audit rights with respect to Petrodelta and any of its Subsidiaries.

Section 5.03 Consultation. The Majority Shareholder shall consult with the Minority Shareholder prior to proposing or consenting to any material action by the Company or any of its Subsidiaries not subject to the Minority Shareholder’s consent rights, including without limitation any material change to or action under the Core Petrodelta Documents, the entry into a new Contract with Petrodelta, any permitted Litigation Event (or actions in connection therewith) or any other material change in the relationship of the Company and its Affiliates with Petrodelta, and shall (a) provide the Minority Shareholder with a reasonable opportunity to review, comment on and propose modifications in respect of any such proposal or consent and (b) consider any such comments or proposed modifications in good faith.

Section 5.04 Fiduciary Duties of Directors. The Majority Shareholder shall take all Necessary Action to ensure that the Directors nominated by the Majority Shareholder act in accordance with the requirements of the Laws of The Netherlands applicable to such Directors.

Section 5.05 Payment of Dividends. The Majority Shareholder shall take all Necessary Action to cause the Company and its Subsidiaries to distribute to the Shareholders of the Company in cash all profits in respect of any dividends paid by Petrodelta.

Section 5.06 Company Joinder. Upon the written request of the Minority Shareholder, the Majority Shareholder shall use its reasonable best efforts, including reasonable best efforts to obtain the consent of O&G Tech (if necessary), to cause the Company to become a party to this Agreement by executing a joinder agreement reasonably acceptable to the Minority Shareholder. By executing such joinder agreement, the Company shall

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agree that wherever it is provided herein that the Majority Shareholder shall take all Necessary Action to cause the Company to take, or refrain from taking, any action, then the Company shall take, or refrain from taking, such action.

Section 5.07 Participation Right. In the event that Parent or the Majority Shareholder seeks to enter into any change of control (pursuant to clause (a), (c) or (d) of the definition thereof) transaction or any direct or indirect sale of the Majority Shareholder’s Subject Shares (any such transaction, a “Sale Transaction”), the Majority Shareholder shall take all Necessary Action, and take all Necessary Action to cause Parent, to provide the Minority Shareholder with (x) notice that the Majority Shareholder intends to commence discussions with regard to a Sale Transaction, (y) any and all information reasonably requested by the Minority Shareholder for the purpose of evaluating and entering into a Sales Transaction (subject to the Minority Shareholder entering into a confidentiality agreement reasonably acceptable to the Minority Shareholder) and (z) the same opportunity to negotiate and submit proposals in respect of any such Sale Transaction as provided to any other potential buyer.

ARTICLE VI

TAX MATTERS

Section 6.01 Administration of Tax Matters. The Majority Shareholder shall, at its own expense, prepare or cause to be prepared and timely file, or cause to be timely filed, all Company Tax Returns and Tax Returns of a VAT Fiscal Unity (taking into account all extensions properly obtained). The Majority Shareholder shall (i) prepare such Tax Returns on a basis consistent with past practices and accounting methods of the Majority Shareholder and the Company and its Subsidiaries except to the extent otherwise required by applicable Law, and (ii) provide a copy of such Tax Return(s) to the Minority Shareholder (with supporting documentation and computations) at least thirty (30) days prior (except, in the case of a Periodic Tax Return, ten (10) days prior) to filing such Tax Return(s). The Minority Shareholder shall, within fifteen (15) days (except, in the case of a Periodic Tax Return, five (5) days) of receiving such Tax Return(s), notify the Majority Shareholder in writing of any matters in such Tax Returns with which the Minority Shareholder reasonably disagrees. In such case, the Majority Shareholder and the Minority Shareholder shall reasonably cooperate with each other to reach a timely and mutually satisfactory solution to the disputed matters and, to the extent they are unable to reach such a solution within ten (10) days, shall resolve the dispute in accordance with Section 6.03.

Section 6.02 Cooperation; Audits; Tax-Related Actions.

(a) In connection with the preparation of Tax Returns (including amended Tax Returns), audit examinations, Tax refund claims, applications for relief or ruling and any actions relating to the Tax liabilities imposed on the Company or its Subsidiaries (or any successor thereof), the Majority Shareholder, on the one hand, and the Minority Shareholder, on the other hand, shall cooperate fully with each other, including the furnishing or making available during normal business hours of records, personnel (as reasonably required and to the extent not unduly burdensome), books of account, powers of attorney or other materials necessary or helpful for the preparation of such Tax Returns, the conduct of audit examinations or the defense of actions by Taxing Authorities as to the imposition of Taxes. The Majority Shareholder shall and to the extent practicable shall take all Necessary Action to cause the Company and is Subsidiaries to (i) retain all books and records with respect to Tax matters pertinent to the Company and is Subsidiaries until the expiration of the applicable statute of limitations (including any extension thereof) for the respective taxable periods, and to abide by all record retention agreements entered into with any Taxing Authority, and (ii) give the Minority Shareholder reasonable written notice prior to transferring, destroying or discarding any such books and records and shall allow such other party to take possession of such books and records at such party’s own expense.

(b) The Majority Shareholder and the Minority Shareholder shall, upon request, use commercially reasonable efforts to obtain any certificate or other document from any Person as may be necessary to mitigate, reduce or eliminate any Tax that could be imposed (including with respect to the transactions contemplated hereby).

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Section 6.03 Referee. If, after negotiating in good faith, the Majority Shareholder and the Minority Shareholder are unable to reach an agreement relating to any Tax matter under this Article VI, the dispute shall be submitted to a mutually acceptable independent accounting firm of national repute (the “Referee”) jointly selected by the Majority Shareholder and the Minority Shareholder within five (5) Business Days of the date on which a party makes the request to refer such dispute to an expert. The Majority Shareholder and the Minority Shareholder shall instruct the Referee to resolve any disputed items within fifteen (15) Business Days of having such items referred to it, pursuant to such procedures as it may require. The parties shall cooperate with the Referee, provide it promptly with all information that it reasonably requires and shall promptly act to implement the decision of the Referee. The costs, fees and expenses of the Referee shall be allocated between 50% to the Majority Shareholder and 50% to the Minority Shareholder.

ARTICLE VII

MISCELLANEOUS

Section 7.01 Term and Termination. The terms and conditions set forth in this Agreement shall become effective as of the date of any termination of the SPA prior to consummation of the Final Closing thereunder and shall continue in accordance with their respective terms; provided this Agreement shall terminate:

(a) by the mutual consent of all Shareholders at any time; or

(b) automatically in the event:

(i) the Final Closing occurs;

(ii) a Tag Right pursuant to Section 3.02, Change of Control Put Option pursuant to Section 3.03 or Litigation Put Option pursuant to Section 3.04 is exercised and consummated.

Section 7.02 Specific Performance.

(a) The parties agree that irreparable damage for which monetary damages, even if available, would not be an adequate remedy, may occur in the event that the parties hereto do not perform the provisions of this Agreement (including failing to take such actions as are required of it hereunder to consummate the transactions contemplated by this Agreement) in accordance with its specified terms or otherwise breach such provisions. Accordingly, except as otherwise set forth in this Section 7.02, the parties acknowledge and agree that the parties hereto shall be entitled, without posting a bond, security or other indemnity, to an injunction, specific performance and other equitable relief to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof, in addition to any other remedy to which they are entitled at law or in equity.

(b) Each party hereby agrees not to raise any objections to the availability of the equitable remedy of specific performance to prevent or restrain breaches of this Agreement by such party, and to specifically enforce the terms and provisions of this Agreement to prevent breaches or threatened breaches of, or to enforce compliance with, the covenants and obligations of such party under this Agreement all in accordance with the terms of this Section 7.02. The parties hereto further agree that (i) by seeking the remedies provided for in this Section 7.02, a party shall not in any respect waive its right to seek any other form of relief that may be available to a party, and (ii) neither the commencement of any legal proceeding pursuant to this Section 7.02 nor anything set forth in this Section 7.02 shall restrict or limit any party’s right to pursue any other remedies that may be available then or thereafter.

Section 7.03 Successors and Assigns; Third Party Beneficiaries. Neither this Agreement nor any rights, interests or obligations hereunder shall be assigned by any of the parties hereto (whether by operation of Law or otherwise); provided that all rights and obligations of the Minority Shareholder shall be assigned to any

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transferee of the Minority Shareholder, and all obligations of the Majority Shareholder shall be binding upon any transferee of the Majority Shareholder, in each case in connection with any Transfer of Subject Shares made in accordance with Article III. Any attempted assignment or transfer, which does not comply with the provisions of this Section 7.03, shall be null and void ab initio. Subject to the preceding sentences, this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the parties and their respective permitted successors and assigns. This Agreement is not intended to and shall not confer any rights or remedies upon any Person other than the parties hereto and their respective successors and permitted assigns.

Section 7.04 Amendments; Waiver. This Agreement may be amended only by an agreement in writing executed by the parties hereto. Either party may waive in whole or in part any benefit or right provided to it under this Agreement, such waiver being effective only if contained in a writing executed by the waiving party. No failure by any party to insist upon the strict performance of any covenant, duty, agreement or condition of this Agreement or to exercise any right or remedy consequent upon breach thereof shall constitute a waiver of any such breach or of any other covenant, duty, agreement or condition, nor shall any delay or omission of either party to exercise any right hereunder in any manner impair the exercise of any such right accruing to it thereafter.

Section 7.05 Notices. Any notice required to be given hereunder shall be sufficient if in writing and sent by facsimile transmission (providing confirmation of transmission by the transmitting equipment) or e-mail of a .pdf attachment (with confirmation of receipt by non-automated reply e-mail from the recipient); provided, that any notice received by facsimile or e-mail transmission or otherwise at the addressee’s location on any Business Day after 5:00 p.m. (local time) shall be deemed to have been received at 9:00 a.m. (local time) on the next Business Day), by reliable overnight delivery service (with proof of service), hand delivery or certified or registered mail (return receipt requested and first-class postage prepaid), addressed as follows (or at such other address for a party as shall be specified in a notice given in accordance with this Section 7.05):

if to the Majority Shareholder:

c/o Harvest Natural Resources, Inc.

1177 Enclave Parkway, Suite 300

Houston, Texas 77077

Phone: (281) 899-5700

Fax: (281) 899-5702

e-mail: khead@harvestnr.com

Attention: Keith Head, Vice President and General Counsel

with a copy (which shall not constitute notice) to:

Baker Botts L.L.P.

One Shell Plaza

910 Louisiana St.

Houston, TX 77002

Phone: (713) 229-1137

Fax: (713) 229-1522

e-mail: thomas.moore@bakerbotts.com

            bill.lamb@bakerbotts.com

Attention: Thomas J. Moore

                 William S. Lamb

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if to the Minority Shareholder:

Petroandina Resources Corporation N.V.

Muiderstraat 7/A

1011PZ Amsterdam, The Netherlands

Phone: +31 20 662 2199

Fax: +31 20 364 0323

e-mail: mstorni@pluspetrol.net

Attention: María Ximena Storni

with a copy (which shall not constitute notice) to:

Cleary Gottlieb Steen & Hamilton LLP

One Liberty Plaza

New York, NY 10006

Phone: (212) 225-2000

Fax: (212) 225-3999

e-mail: jlewis@cgsh.com; nwhoriskey@cgsh.com

Attention: Jeffrey S. Lewis

                 Neil Q. Whoriskey

Section 7.06 Governing Law and Exclusive Jurisdiction; Service of Process; Waiver of Jury Trial.

(a) This Agreement shall be governed by and construed in accordance with the Laws of the State of New York (without regard to principles of conflicts of law thereof that would cause the application of Laws of any other jurisdiction other than the State of New York).

(b) Each of the parties hereto irrevocably submit to the exclusive jurisdiction of the Court of Chancery of the State of Delaware, County of New Castle (or, if (but only if) such court shall be unavailable, any other court of the State of Delaware or any Federal court sitting in the State of Delaware), for the purpose of any action, proceeding or counterclaim (whether based on contract, tort or otherwise) arising out of or relating to this Agreement and each of the parties hereto hereby irrevocably agrees that all claims in respect of such action or proceeding may be heard and determined exclusively in the Court of Chancery of the State of Delaware, County of New Castle (or, if (but only if) such court shall be unavailable, any other court of the State of Delaware or any Federal court sitting in the State of Delaware).

(c) Each of the parties hereto (a) irrevocably consents to the service of the summons and complaint and any other process in any other action or proceeding relating to the transactions contemplated by this Agreement, on behalf of itself or its property, by personal delivery of copies of such process to such party and nothing in this Section 7.06 shall affect the right of any party to serve legal process in any other manner permitted by Law, (b) consents to submit itself to the personal jurisdiction of the Delaware Court of Chancery, County of New Castle, any other court of the State of Delaware, County of New Castle, and any Federal court sitting in the State of Delaware for the purpose of any dispute arising out of this Agreement or the transactions contemplated by this Agreement, (c) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court and (d) agrees that it will not bring any action relating to this Agreement or the transactions contemplated by this Agreement in any court other than the Delaware Court of Chancery located in the County of New Castle (or, if (but only if) such court shall be unavailable, any other court of the State of Delaware or any Federal court sitting in the State of Delaware). Each of Buyer, Seller and HNR agrees that a final judgment in any action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law.

(d) EACH OF THE PARTIES HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT,

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TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF BUYER, SELLER OR HNR IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT THEREOF.

Section 7.07 Headings. The heading references herein and the table of contents hereof are for convenience purposes only, and shall not be deemed to limit or affect any of the provisions hereof.

Section 7.08 Entire Agreement. This Agreement (including the Exhibits hereto and other documents delivered pursuant hereto), together with the Related Agreements, constitutes the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and undertakings, both written and oral, among the parties and their Affiliates, or any of them, with respect to the subject matter hereof.

Section 7.09 Severability. If any term or other provision of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void, illegal or incapable of being enforced under any present or future Law or public policy, (a) such term or other provision shall be fully separable, (b) this Agreement shall be construed and enforced as if such invalid, illegal or unenforceable provision had never comprised a part hereof, and (c) all other conditions and provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable term or other provision or by its severance herefrom so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible to the fullest extent permitted by applicable Law in a mutually acceptable manner in order that the transactions contemplated hereby are fulfilled as originally contemplated to the fullest extent possible.

Section 7.10 Certain Limitations. Notwithstanding anything in this Agreement to the contrary, no Person other than the Majority Shareholder and Parent, including without limitation, any officer, director, employee, agent or representative of the Company, the Majority Shareholder or Parent, shall have any liability or obligation to the Minority Shareholder or any other Person as a result of the breach or any representation, warranty, covenant, agreement or obligation of the Majority Shareholder in this Agreement.

Section 7.11 Counterparts. This Agreement may be executed in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Agreement by facsimile transmission or by e-mail of a .pdf attachment shall be effective as delivery of a manually executed counterpart of this Agreement.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed by their respective authorized officers as of the date first written above.

HNR ENERGIA B.V.
By:	/s/ James A. Edmiston
Name:	James A. Edmiston
Title:	Attorney-in-Fact

PETROANDINA RESOURCES CORPORATION N.V.
By:	/s/ Maria Ximena Storni
Name:	Maria Ximena Storni
Title:	Attorney-in-fact

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EXHIBIT A

FORM OF SHAREHOLDER JOINDER

THIS SHAREHOLDER JOINDER (this “Agreement”) dated as of [Insert Date] is made by [Insert Name of Transferee] (the “Transferee”).

WHEREAS, HNR Energia B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) organized and existing under the Laws of Curaçao (the “Majority Shareholder”) and Petroandina Resources Corporation N.V., a company with limited liability (naamloze vennootschap) organized and existing under the Laws of the Netherlands (the “Minority Shareholder”) have entered into a shareholders agreement dated as of December 16, 2013 (the “Shareholders Agreement”), as amended from time to time;

WHEREAS, [Insert name of transferor] desires to transfer all of its Subject Shares to the Transferee in accordance with the provisions of Article III of the Shareholders Agreement; and

WHEREAS, Article III of the Shareholders Agreement requires that, prior to such transfer, the Transferee must deliver an executed copy of this Agreement.

NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Transferee agrees as follows:

Section 1. Definitions. Capitalized terms used herein and not otherwise defined shall have the meanings given to them in the Shareholders Agreement.

Section 2. Adherence to Shareholders Agreement. The Transferee hereby agrees with each party to the Shareholders Agreement that it will comply with and be bound by all of the provisions of the Shareholders Agreement (a copy of which has been delivered to the Transferee and which has been initialed by such Transferee and is attached hereto for identification) in all respects and is hereby made a party to such Agreement as if such Transferee were named therein as a party and on the basis that references therein to [Insert name of Majority Shareholder if transferor is the Majority Shareholder or one of its Permitted Transferees][Insert name of Minority Shareholder if transferor is the Minority Shareholder] shall be deemed to refer to the Transferee.

Section 3. Representations and Warranties. The Transferee hereby represents and warrants to each Shareholder on the date hereof as follows:

(a) Execution. This Agreement has been duly and validly executed and delivered by the Transferee and this Agreement constitutes a legal and binding obligation of the Transferee, enforceable against the Transferee in accordance with its terms.

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(b) No Conflict. The execution and delivery by the Transferee of this Agreement and performance by the Transferee of this Agreement and the consummation by the Transferee of the transactions contemplated hereby will not, with or without the giving of notice or lapse of time, or both (i) violate any Law applicable to it, or (B) conflict with, or result in a breach or default under, any term or condition of any agreement or other instrument to which the Transferee is a party or by which the Transferee is bound, except for such violations, conflicts, breaches or defaults that would not, in the aggregate, materially affect the Transferee’s ability to perform its obligations hereunder.

(c) [Insert if a Permitted Transferee of Majority Shareholder][Permitted Transferee. The Transferee is a Permitted Transferee of the Majority Shareholder.]

Section 4. [Insert if a Permitted Transferee of Majority Shareholder][Covenant to Transfer. Before the Transferee ceases to be a Qualified Affiliate of the Majority Shareholder, it shall Transfer, in a manner permitted by the Shareholders Agreement, all the Subject Shares held by it back to the Majority Shareholder or another Qualified Affiliate of the Majority Shareholder that shall remain a Qualified Affiliate after such Transfer.]

Section 5. Notice. The notice details of the Transferee for purposes of Section 7.05 of the Shareholders Agreement are as follows:

[                                         ]

Section 6. Governing law. Section 7.06 of the Shareholders Agreement is incorporated herein by reference, mutatis mutandis.

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IN WITNESS WHEREOF, the Transferee has executed this Agreement as of the date first above written.

[NAME OF TRANSFEREE]

By:

Name:

Title:

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EXHIBIT B

PARENT GUARANTEE

This Parent Guarantee, dated as of December 16, 2013 (this “Guarantee”), is made by Harvest Natural Resources, Inc., a Delaware corporation (the “Guarantor”) in favor of Petroandina Resources Corporation N.V., a company with limited liability (naamloze vennootschap) organized and existing under the Laws of the Netherlands (“Minority Shareholder”).

WHEREAS, HNR Energia B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) organized and existing under the Laws of Curaçao (the “Majority Shareholder”) and the Minority Shareholder are parties to a Shareholders’ Agreement, dated as of the date hereof (the “Shareholders Agreement”) and an Ancillary Agreement (the “Ancillary Agreement”), with respect to certain rights and obligations of the Majority Shareholder and the Minority Shareholder in connection with the purchase of Subject Shares (as defined in the Shareholders Agreement) from the Majority Shareholder by the Minority Shareholder; and

WHEREAS, it is a condition and inducement to the willingness of Minority Shareholder to enter into the Shareholders Agreement and the Ancillary Agreement that the Guarantor execute and deliver this Guarantee in favor of the Minority Shareholder.

NOW, THEREFORE, in consideration of the foregoing and the mutual promises, covenants and agreements of the parties hereto, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

Section 1. Definitions. Capitalized terms used herein and not otherwise defined shall have the meanings given to them in the Shareholders Agreement.

Section 2. Guarantee. In connection with the transactions contemplated by the Shareholders Agreement and the Ancillary Agreement, the Guarantor hereby irrevocably, absolutely and unconditionally guarantees the due, punctual and complete performance and payment (and not merely collection) in full of all obligations and liabilities of the Majority Shareholder and any of its Affiliates or Permitted Transferees under the Shareholders Agreement and the Ancillary Agreement, as and when due and payable or required to be performed pursuant to any provisions of the Shareholders Agreement and the Ancillary Agreement, subject to the terms and conditions thereof (the “Guaranteed Obligations”) and agrees that Minority Shareholder shall be entitled to enforce directly against Guarantor any of the Guaranteed Obligations. To the fullest extent permitted by applicable Law, the Guarantor waives presentment to, demand of payment from and protest to any other Person of any of the Guaranteed Obligations, and also waives notice of acceptance of its guarantee and notice of protest for nonpayment. The obligations of the Guarantor hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense or setoff, counterclaim, recoupment or termination whatsoever by reason of the invalidity, illegality or unenforceability of the Guaranteed Obligations, or otherwise. Notwithstanding any of the foregoing, nothing herein shall be deemed to waive or limit the Guarantor’s ability to assert any claims, defenses or other rights that the Majority Shareholder or its Affiliates or Permitted Transferees may have under the Shareholders Agreement or the Ancillary Agreement. In the event that the Guarantor or any of its successors or assigns (a) consolidates with or merges into any other Person and is not the continuing or surviving corporation or entity of such consolidation or merger or (b) other than as contemplated by the SPA, transfers or conveys all or substantially all of its properties and other assets to any Person, then, and in each such case, the Guarantor shall cause proper provision to be made so that such successor or assign shall expressly assume the obligations set forth in this Section 2.

Section 3. Term and Termination. This Guarantee shall become effective as of the date of any termination of the SPA prior to consummation of the Final Closing thereunder and shall remain in full force and effect, and the obligations of the Guarantor hereunder shall continue and not be discharged until such time as the

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Shareholders Agreement and the Ancillary Agreement have terminated and are of no further force and effect; provided that any such termination shall not release or discharge any Guaranteed Obligation that shall have accrued prior to the date of such termination.

Section 4. Notices. Any notice required to be given hereunder shall be sufficient if in writing and sent by facsimile transmission (providing confirmation of transmission by the transmitting equipment) or e-mail of a .pdf attachment (with confirmation of receipt by non-automated reply e-mail from the recipient); provided, that any notice received by facsimile or e-mail transmission or otherwise at the addressee’s location on any Business Day after 5:00 p.m. (local time) shall be deemed to have been received at 9:00 a.m. (local time) on the next Business Day), by reliable overnight delivery service (with proof of service), hand delivery or certified or registered mail (return receipt requested and first-class postage prepaid), addressed as follows (or at such other address for a party as shall be specified in a notice given in accordance with this Section 4):

if to the Guarantor:

c/o Harvest Natural Resources, Inc.

1177 Enclave Parkway, Suite 300

Houston, Texas 77077

Phone: (281) 899-5700

Fax: (281) 899-5702

e-mail: khead@harvestnr.com

Attention: Keith Head, Vice President and General Counsel

with a copy (which shall not constitute notice) to:

Baker Botts L.L.P.

One Shell Plaza

910 Louisiana St.

Houston, TX 77002

Phone: (713) 229-1137

Fax: (713) 229-1522

e-mail: thomas.moore@bakerbotts.com

               bill.lamb@bakerbotts.com

Attention: Thomas J. Moore

                 William S. Lamb

if to Minority Shareholder:

Petroandina Resources Corporation N.V.

Muiderstraat 7/A

1011PZ Amsterdam, The Netherlands

Phone: +31 20 662 2199

Fax: +31 20 364 0323

e-mail: mstorni@pluspetrol.net

Attention: María Ximena Storni

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with a copy (which shall not constitute notice) to:

Cleary Gottlieb Steen & Hamilton LLP

One Liberty Plaza

New York, NY 10006

Phone: (212) 225-2000

Fax: (212) 225-3999

e-mail: jlewis@cgsh.com; nwhoriskey@cgsh.com

Attention: Jeffrey S. Lewis

                 Neil Q. Whoriskey

Section 5. Miscellaneous. Except for Section 7.01 and Section 7.05, Article VII of the Shareholders Agreement is incorporated herein, mutatis mutandis.

[Signature Page Follows]

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IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be executed and delivered as of the date first above written.

HARVEST NATURAL RESOURCES, INC.

By:

Name:

Title:

ACKNOWLEDGED AND AGREED

PETROANDINA RESOURCES CORPORATION N.V.

By:

Name:

Title:

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EXECUTION VERSION

EXHIBIT C

FORM OF PUT CONTRACT

DEED OF SALE, PURCHASE AND TRANSFER OF SHARES

On the [—] day of [—]

two thousand and [—], appearing before me,

[—], a civil-law notary in Rotterdam (the “Notary”), are:

I. [—], acting pursuant to a power of attorney from:

Petroandina Resources Corporation N.V., a company with limited liability (naamloze vennootschap), existing under the laws of the Netherlands, with its corporate seat in Amsterdam (The Netherlands) and its place of business at (1011 PZ) Amsterdam (The Netherlands), Muiderstraat 7 A, registered with the trade register under number 50187511 (“Seller”);

II. [—], acting pursuant to a power of attorney from:

HNR Energia B.V., a private limited liability company (besloten vennootschap), existing under the laws of Curaçao, with its corporate seat in Curaçao and its place of business at (1097 JB) Amsterdam (The Netherlands), Prins Bernhardplein 200, registered with the trade register under number 34311729 (“Buyer”); and

III. [—], acting pursuant to a power of attorney from:

Harvest-Vinccler Dutch Holding B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid), existing under the laws of the Netherlands, with its corporate seat in Amsterdam (The Netherlands) and its place of business at (1097 JB) Amsterdam (The Netherlands), Prins Bernhardplein 200, registered with the trade register under number 14037775 (“Company”).

RECITALS

Seller and Buyer agree that:

A. Share Purchase Agreement; Shareholders’ Agreement

Pursuant to a share purchase agreement (the “Share Purchase Agreement”) dated the [—] day of [—] two thousand and thirteen by and among Buyer, and, solely with respect to Article V and Section 11.13 thereof, Pluspetrol Resources Corporation B.V., Seller and Harvest Natural Resources, Inc. (“HNR”), Seller acquired seven thousand two hundred fifty (7,250) of the ordinary Class A shares in the capital of the Company (the “Subject Shares”), numbered A1 up to and including A7,250, each ordinary Class A share having a par value of one euro (€1), constituting twenty-nine per cent (29%) of the issued and outstanding capital of the Company.

Buyer and Seller are Party to a shareholders’ agreement (the “Shareholders Agreement”), dated the [—] day of [—] two thousand and thirteen, in respect of Seller’s ownership of the Subject Shares and certain rights and obligations of Seller and Buyer with respect thereto.

B. [Change of Control Put Option][Litigation Put Option]

[Pursuant to Section 3.03 of the Shareholders Agreement, in connection with any change of control (as defined in the Shareholders Agreement) of Buyer, Seller shall have the right and option, exercisable upon written notice to Buyer, to sell to Buyer and to cause Buyer to purchase, or cause to be purchased, all but not less than all of the Subject Shares for an aggregate purchase price equal to the Fair Market Value of

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the Subject Shares determined in accordance with Section 3.06 of the Shareholders Agreement (the “Change of Control Put Option”).] [Pursuant to Section 3.04 of the Shareholders Agreement, in connection with Buyer’s commencement of any Litigation Event], Seller shall have the right and option, exercisable upon written notice to Buyer, to sell to Buyer and to cause Buyer to purchase, or cause to be purchased, all but not less than all of the Subject Shares for an aggregate purchase price equal to the Fair Market Value of the Subject Shares determined in accordance with Section 3.06 of the Shareholders Agreement (the “Litigation Put Option”).

C. Exercise of [Change of Control Put Option] [Litigation Put Option]

[Buyer has delivered a Change of Control Notice to Seller and, following determination of the Fair Market Value of the the Subject Shares in accordance with Section 3.06 of the Shareholders Agreement, Seller has exercised the Change of Control Put Option in accordance with Section 3.04(c) of the Shareholders Agreement.] [Buyer has delivered a Litigation Notice to the Seller and the Seller has exercised the Litigation Put Option in accordance with Section 3.04(e) of the Shareholders Agreement.] In performance of their respective obligations under the Shareholders’ Agreement, Seller hereby wishes to sell and transfer the Subject Shares to Buyer, and Buyer hereby wishes to purchase and accept the Subject Shares from Seller (the “Transaction”).

SALE, PURCHASE AND TRANSFER OF THE SUBJECT SHARES

Seller and Buyer agree:

Article 1. Definitions

1.1. All capitalized terms used herein and not otherwise defined shall have the meanings assigned to them in the Shareholders Agreement and, where not so defined in the Shareholders Agreement, in the Share Purchase Agreement.

Article 2. Conditions precedent

2.1. The following are the conditions precedent (opschortende voorwaarden) for the Transaction to occur, which Seller and Buyer declare have been satisfied or waived (and which waiver has been accepted by Seller and Buyer) prior to the execution of this deed:

a. Buyer shall have delivered to the Notary:

(i) (A) a written shareholders’ resolution approving the transfer of the Subject Shares, duly executed by all shareholders of the Company, or (B) duly adopted minutes of a duly convened shareholder’s meeting approving the transfer of the Subject Shares, which in each case is effective pursuant to the articles of association of the Company;

(ii) duly legalized powers-of-attorney with respect to execution of this deed;

(iii) the shareholders’ register of the Company;

(iv) and such other documents as may be customary and required under applicable Law, or reasonably required by the Notary;

b. Seller shall cause the written shareholders’ resolution approving the transfer of the Subject Shares referenced in Article 2.1(a)(i)(A) above to be duly executed by Seller, if applicable.

c. Seller shall deliver to the Notary:

(i) a duly legalized power-of-attorney with respect to execution of this deed;

(ii) and such other documents as may be customary and required under applicable Law, or reasonably required by the Notary;

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d. Buyer shall transfer the Purchase Price in accordance with Article 4.2 hereof.

e. Buyer shall deliver to Seller a certificate, dated as of the date hereof, and signed by an executive officer of Buyer, certifying that each of the representations and warranties of Buyer contained in this deed are true and correct in all respects at and as of the date hereof; and

f. Seller shall deliver to Buyer a certificate, dated as of the date hereof, and signed by a duly authorized signatory of Seller, certifying that each of the representations and warranties of Seller contained in this deed are true and correct in all respects at and as of the date hereof.

Article 3. Sale, purchase and transfer

3.1. In performance of their respective obligations under [Section 3.03] [Section 3.04] of the Shareholders Agreement, Seller hereby sells and transfers the Subject Shares to Buyer, and Buyer hereby purchases and accepts the Subject Shares from Seller.

Article 4. Purchase Price and discharge

4.1. The purchase price payable for the Subject Shares is an amount equal to [—] United States Dollars (US$ [—]) (the “Purchase Price”).

4.2. The Purchase Price has been paid by wire transfer of immediately available funds by Buyer to an account designated in writing by Seller at least two Business Days prior to the date hereof.

4.3. Seller hereby discharges Buyer from the obligation to pay the Purchase Price.

Article 5. Representations and Warranties of Seller

5.1. Organization and Qualification. Seller is a company with limited liability (naamloze vennootschap) duly organized or formed, validly existing and (to the extent applicable) in good standing, under the laws of its jurisdiction of incorporation and has the requisite corporate power and authority to conduct its business as it is now being conducted. Seller is duly qualified or licensed as a foreign corporation to do business, and (to the extent applicable) is in good standing, in each jurisdiction in which the character of the properties owned, leased or operated by it or the nature of its business makes such qualification or licensing necessary, except where the failure to be so qualified or licensed or to be in good standing would not reasonably be expected to, individually or in the aggregate, materially impair the ability of Seller to consummate the transactions contemplated by this deed.

5.2. Title to the Subject Shares. Immediately following the execution of this deed, Buyer will have such title to the Subject Shares as Seller received from Buyer upon consummation of the Initial Closing under the Share Purchase Agreement, free and clear of any Liens (other than Permitted Liens and any other Liens on the Subject Shares existing upon the consummation of the Initial Closing).

5.3. Authority Relative to Deed. Seller has all necessary power and authority to execute and deliver this deed and to perform its obligations hereunder and to consummate the transactions contemplated hereby. The execution of this deed by Seller and the consummation by Seller of the transactions contemplated hereby have been duly and validly authorized by all necessary corporate action of Seller and no other corporate proceedings on the part of Seller are necessary to authorize the execution and delivery of this deed or to consummate the transactions contemplated hereby. This deed has been duly and validly executed by Seller and, assuming the due authorization and execution by Buyer, this deed constitutes a legal, valid and binding obligation of Seller, enforceable against Seller in accordance with its terms (except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similar laws of general applicability relating to or affecting creditor’s rights, and subject to general equitable principles).

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5.4. No Conflict; Required Filings and Consents.

a. None of the execution and delivery of this deed by Seller, the consummation by Seller of the transactions contemplated by this deed or performance of its obligations hereunder will (i) conflict with or violate the organizational documents of Seller, (ii) assuming the consents, registrations, filings, notices, approvals and authorizations specified in Article 5.4(b) hereof have been obtained or made and the waiting periods referred to therein have expired, and any condition precedent to such consent, approval, authorization, or waiver has been satisfied, conflict with or violate any Law applicable to Seller or by which any property or asset of Seller is bound or affected or (iii) result in any breach of, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any right of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien on any of the properties or assets of Seller pursuant to, any note, bond, mortgage, indenture or credit agreement, or any other Contract or other instrument or obligation to which Seller is a party or by which Seller or any property or asset of Seller is bound, other than, in the case of clauses (ii) and (iii), for any such violation, breach, default, right, termination, amendment, acceleration, or cancellation that would not reasonably be expected to, individually or in the aggregate, materially and adversely impair the ability of Seller to consummate the transactions contemplated by this deed.

b. None of the execution of this deed by Seller, the consummation by Seller of the transactions contemplated by this deed, or performance of its obligations hereunder will require any consent, approval, authorization, waiver or permit of, or filing with or notification to, any Governmental Authority, except for (i) the filing with the SEC of such reports under the Exchange Act as may be required in connection with this deed and the transactions contemplated by this deed and (ii) such other consents, approvals, authorizations or permits, filings or notifications, the failure of which to have, make or obtain, as applicable, would not reasonably be expected to, individually or in the aggregate, materially impair the ability of Seller to consummate the transactions contemplated by this deed.

5.5. Disclaimer of other Representations and Warranties. Except for the representations and warranties expressly set forth in this Article 5 and Article 9 hereof, none of the Seller or any of its Affiliates or any other Person on behalf of any of them makes any express or implied representation or warranty (and there is and has been no reliance by Buyer or any of its Affiliates or Representatives on any such representation or warranty) with respect to the Seller or any of its Affiliates or their respective businesses or with respect to any other information provided, or made available, to HNR or any of its Representatives or Affiliates in connection with the transactions contemplated hereby, including the accuracy or completeness thereof.

Article 6. Representations and Warranties of the Buyer.

6.1. Organization and Qualification. Buyer is a private limited liability company (besloten vennootschap) duly organized or formed, validly existing and (to the extent applicable) in good standing, under the laws of its jurisdiction of organization or formation and has the requisite corporate or similar entity power and authority to conduct its business as it is now being conducted. Buyer is duly qualified or licensed as a foreign entity to do business, and (to the extent applicable) is in good standing, in each jurisdiction in which the character of the properties owned, leased or operated by it or the nature of its business makes such qualification or licensing necessary, except where the failure to be so qualified or licensed or to be in good standing would not reasonably be expected to, individually or in the aggregate, materially impair the ability of Buyer to consummate the transactions contemplated by this deed.

6.2. Authority Relative to Deed. Buyer has all necessary corporate power and authority to execute and deliver this deed and to perform its obligations hereunder and to consummate the transactions contemplated hereby. The execution of this deed by Buyer and the consummation by Buyer of the transactions contemplated hereby have been duly and validly authorized by all necessary corporate action, and no other corporate proceedings on the part of Buyer are necessary to authorize the execution and delivery of this

35

deed or to consummate the transactions contemplated hereby. This deed has been duly and validly executed by Buyer and, assuming the due authorization and execution by Seller, constitutes a legal, valid and binding obligation of Buyer, enforceable against Buyer in accordance with its terms (except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similar laws of general applicability relating to or affecting creditor’s rights, and subject to general equitable principles).

6.3. No Conflict; Required Filings and Consents.¹

a. None of the execution of this deed [or any agreement in respect of transactions substantially related to this deed], the consummation by Buyer of the acquisition of the Subject Shares [or any substantially related transactions], or the performance by Buyer of its obligations hereunder [or under any agreement in respect of transactions substantially related to this deed] will (i) conflict with or violate the organizational documents of Buyer, (ii) assuming the consents, registrations, filings, notices, approvals and authorizations specified in Article 6.3(b) hereof have been obtained or made, and any condition precedent to such consent, approval, authorization, or waiver has been satisfied, conflict with or violate any Law applicable to Buyer or by which any property or asset of Buyer is bound or affected or (iii) result in any breach of, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, relieve a Person from an obligation under or give to others any right of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien upon any of the properties or assets of Buyer pursuant to (A) any of the Core Petrodelta Documents or (B) any other Acquired Company Material Contract, other than, in the case of clauses (ii) and (iii)(B), any such violation, breach, default, right of termination, amendment, acceleration, cancellation or Lien that would not be reasonably be expected to, individually or in the aggregate, materially and adversely impair the ability of Buyer to consummate the transactions contemplated by this deed.

b. None of the execution of this deed [or any agreement in respect of transactions substantially related to this deed], the consummation by Buyer of the transactions contemplated by this deed [or any substantially related transactions], or Buyer’s performance of its obligations hereunder [or under any agreement in respect of transactions substantially related to this deed] will require any consent, approval, authorization, waiver or permit of, or filing with or notification to, any Governmental Authority, except for (i) the filing with the SEC of such reports under the Exchange Act as may be required in connection with this deed and the transactions contemplated by this deed, (ii) any filings required under the rules of NYSE and (iii) such other consents, approvals, authorizations or permits, filings or notifications, the failure of which to have, make or obtain, as applicable, would not be reasonably be expected to, individually or in the aggregate, materially and adversely impair the ability of Buyer to consummate the transactions contemplated by this deed.

6.4. Disclaimer of other Representations and Warranties. Except for the representations and warranties expressly set forth in this Article 6 and Article 9 hereof, none of HNR, Buyer or any of their respective Affiliates nor any other Person on behalf of HNR makes any express or implied representation or warranty (and there is and has been no reliance by Seller or any of its Affiliates or Representatives on any such representation or warranty) with respect to any information provided, or made available, to Seller or its Representatives or Affiliates in connection with the transactions contemplated hereby, including the accuracy or completeness thereof.

Article 7. Acquisition of the Subject Shares

7.1. Seller declares that Seller acquired the Subject Shares by deed executed on the [—] day of [—] two thousand and thirteen before Ph. H.F. König , aforementioned.

¹  Bracketed text to be included if Buyer acquiring the Subject Shares in connection with a change of control of Buyer.

36

Article 8. Restrictions on transfer

8.1. With respect to compliance with the restrictions on the transfer of shares in the Company’s articles of association, each of Seller and Buyer declare that as appears from a shareholders’ resolution dated [—], a copy of which is attached to this deed, the general meeting of the Company has approved the transfer of the Subject Shares.

Article 9. Representation of Seller and Buyer

9.1. Seller and Buyer declare that neither the legal act(s) included in this deed nor the title(s) of such act(s) conflict with Chapter 5 of the Competition Act (Mededingingswet).

Article 10. Company’s representation

10.1. The Company hereby declares that it acknowledges the transfer of the Subject Shares and undertakes to enter the transfer of the Subject Shares in the shareholders’ register of the Company.

Article 11. Civil-law notary

11.1. [The parties hereby acknowledge that [—], the civil law notary (notaris) before whom this deed is executed (gepasseerd), is associated with Houthoff Buruma Coöperatief U.A., a firm of civil-law notaries and lawyers that advises and represents Seller in connection with this deed and other matters. With reference to the Regulation establishing the Professional Rules of Conduct of the Dutch Royal Notarial Society (Koninklijke Notariële Beroepsorganisatie), Buyer and the Company hereby (i) acknowledge and agree that Seller is being advised and/or represented by civil-law notaries and/or lawyers of Houthoff Buruma Coöperatief U.A. in connection with this deed and other matters, and (ii) agree that Seller may request lawyers of Houthoff Buruma Coöperatief U.A. to represent Buyer in any dispute arising out of this deed against Seller and/or the Company.]

Article 12. Rescission

12.1. The parties shall not be entitled, on any grounds whatsoever, to rescind the agreement laid down in this deed.

Article 13. Applicable law and jurisdiction

13.1. The transactions (rechtshandelingen) contemplated by this deed shall be governed exclusively by Dutch law.

13.2. Each of the parties hereto hereby irrevocably submits to the exclusive jurisdiction of the Court of Chancery of the State of Delaware, County of New Castle (or, if (but only if) such court shall be unavailable, any other court of the State of Delaware or any Federal court sitting in the State of Delaware), for the purpose of any action, proceeding or counterclaim (whether based on contract, tort or otherwise) arising out of or relating to this deed and each of the parties hereto hereby irrevocably agrees that all claims in respect of such action or proceeding may be heard and determined exclusively in the Court of Chancery of the State of Delaware, County of New Castle (or, if (but only if) such court shall be unavailable, any other court of the State of Delaware or any Federal court sitting in the State of Delaware).

13.3. Each of the parties hereto (a) irrevocably consents to the service of the summons and complaint and any other process in any other action or proceeding relating to the transactions contemplated by this deed, on behalf of itself or its property, by personal delivery of copies of such process to such party and nothing in this Article 13.3 shall affect the right of any party to serve legal process in any other manner permitted by law, (b) consents to submit itself to the personal jurisdiction of the Delaware Court of Chancery, County of

37

New Castle, any other court of the State of Delaware, County of New Castle, and any Federal court sitting in the State of Delaware for the purpose of any dispute arising out of this deed or the transactions contemplated by this deed, (c) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court and (d) agrees that it will not bring any action relating to this deed or the transactions contemplated by this deed in any court other than the Delaware Court of Chancery located in the County of New Castle (or, if (but only if) such court shall be unavailable, any other court of the State of Delaware or any Federal court sitting in the State of Delaware). Each of the parties hereto agrees that a final judgment in any action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.

CONCLUDING STATEMENT

The above-mentioned powers of attorney are evidenced by three (3) instruments annexed to the present deed.

CONCLUSION

The persons appearing in connection with this deed are known to me, civil-law notary.

THIS DEED

is executed in Rotterdam on the date stated at the head of the deed.

The substance of this deed and an explanation of the deed have been communicated to the persons appearing, who have expressly taken cognisance of its contents and have agreed to its limited reading.

After a limited reading in accordance with the law, this deed was signed by the persons appearing and by me, civil-law notary.

38

EX-21.1

EXHIBITS

EXHIBIT 21.1

LIST OF SUBSIDIARIES

Name	Jurisdiction of Incorporation
Harvest-Vinccler Dutch Holding B.V.*	The Netherlands
HNR Energia B.V.	The Netherlands

The names of certain subsidiaries have been omitted in reliance upon Item 601(b)(21)(ii) of Regulation S-K.

* All subsidiaries are wholly-owned by Harvest Natural Resources, Inc., except Harvest-Vinccler Dutch Holding B.V. which is indirectly owned 51 percent by Harvest Natural Resources, Inc.

EX-23.1

EXHIBIT 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-167887, 333-134630, 333-115841, and 333-85900) of Harvest Natural Resources, Inc. of our reports dated March 17, 2014 with respect to the consolidated financial statements of Harvest Natural Resources, Inc. and subsidiaries as of December 31, 2013 and for the year then ended, and to the effectiveness of Harvest Natural Resources, Inc. and subsidiaries’ internal control over financial reporting as of December 31, 2013, which appears in this Annual Report on Form 10-K for the year ended December 31, 2013.

/s/ UHY LLP

Houston, Texas

March 17, 2014

EX-23.2

EXHIBIT 23.2

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-167887, 333-134630, 333-115841, and 333-85900) of Harvest Natural Resources, Inc. of our report dated May 2, 2013 except with respect to the discontinued operations related to the Oman operations described in Note 5 to the financial statements, as to which the date is January 28, 2014, relating to the financial statements, which appears in this Annual Report on Form 10-K of Harvest Natural Resources, Inc. dated March 17, 2014.

/s/ PricewaterhouseCoopers LLP

Houston, Texas

March 17, 2014

EX-23.3

EXHIBIT 23.3

HARVEST NATURAL RESOURCES, INC.

INDEPENDENT PETROLEUM ENGINEERS’ CONSENT

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-167887, 333-134630, 333-115841, and 333-85900) of Harvest Natural Resources, Inc. of our reports dated February 26, 2014 relating to the reserve reports, which appears in this Annual Report on Form 10-K.

/s/ Ryder Scott Company, L.P.

Denver, Colorado

March 17, 2014

EX-23.4

EXHIBIT 23.4

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-167887, 333-134630, 333-115841, and 333-85900) of Harvest Natural Resources, Inc. of our report dated March 12, 2014 relating to the financial statements of Petrodelta, S. A. at December 31, 2013 presented in accordance with International Reporting Standards, which appears in this Annual Report on Form 10-K.

/s/ PGFA Perales, Pistone & Asociados

Valencia, Venezuela

March 17, 2014

EX-31.1

EXHIBIT 31.1

I, James A. Edmiston, certify that:

1. I have reviewed this report on Form 10-K of Harvest Natural Resources, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 17, 2014

/s/ James A. Edmiston

James A. Edmiston

President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

I, Stephen C. Haynes, certify that:

1. I have reviewed this report on Form 10-K of Harvest Natural Resources, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 17, 2014

/s/ Stephen C. Haynes

Stephen C. Haynes

Vice President—Finance, Chief Financial

Officer and Treasurer

EX-32.1

EXHIBIT 32.1

Accompanying Certificate

Pursuant to Rule 13a – 14(b) or Rule 15d – 14(b)

and 18 U.S.C. Section 1350

Not Filed Pursuant to the Securities Exchange Act of 1934

The undersigned Chief Executive Officer of Harvest Natural Resources, Inc. (the “Company”) does hereby certify as follows:

This report on Form 10-K of Harvest Natural Resources, Inc. for the period ended December 31, 2013 and filed with the Securities and Exchange Commission on the date hereof (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: March 17, 2014	By:	/s/ James A. Edmiston
		James A. Edmiston
		President and Chief Executive Officer

EX-32.2

EXHIBIT 32.2

Accompanying Certificate

Pursuant to Rule 13a – 14(b) or Rule 15d – 14(b)

and 18 U.S.C. Section 1350

Not Filed Pursuant to the Securities Exchange Act of 1934

The undersigned Chief Financial Officer of Harvest Natural Resources, Inc. (the “Company”) does hereby certify as follows:

This report on Form 10-K of Harvest Natural Resources, Inc. for the period ended December 31, 2013 and filed with the Securities and Exchange Commission on the date hereof (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: March 17, 2014	/s/ Stephen C. Haynes
	Stephen C. Haynes
	Vice President – Finance, Chief Financial
	Officer and Treasurer

EX-99.1

Exhibit 99.1

PETRODELTA, S.A.

(SUBSIDIARY OF CORPORACIÓN

VENEZOLANA DEL PETRÓLEO, S.A—CVP)

FINANCIAL STATEMENTS

FOR THE YEARS ENDED

DECEMBER 31, 2013, 2012 AND 2011

AND

INDEPENDENT AUDITOR’S REPORT

PETRODELTA, S.A.

(Subsidiary of Corporación Venezolana del Petróleo, S.A.—CVP)

Index

		Pages
Independent Auditor´s Report		2 - 3
Statements of financial position		4
Statements of comprehensive income		5
Statements of changes in equity		6 - 7
Statements of cash flow		8
Notes to the financial statements		9
(1)	Reporting entity	9
(2)	Basis of preparation	11
(3)	Summary of significant accounting policies	13
(4)	Exchange agreement with the Central Bank of Venezuela (BCV)	28
(5)	Determination of fair values	29
(6)	Financial risk management	30
(7)	Taxes and Royalties	32
(8)	Property, plant and equipment, net	39
(9)	Prepaid expenses and other assets	42
(10)	Inventories	42
(11)	Accounts receivable	42
(12)	Cash and cash equivalents	43
(13)	Equity	43
(14)	Provisions	47
(15)	Accruals and other Liabilities	49
(16)	Accounts payable	50
(17)	Operational expenses	50
(18)	Financial income and expenses	51
(19)	Financial instruments	51
(20)	Commitments and contingencies	54
(21)	Related party transactions	55
(22)	Collective labor agreement	58
(23)	Laws, resolutions and legal contributions	59
(24)	Subsequent events	65
(25)	Supplementary Information on Oil and Gas Exploration and Production Activities (unaudited)	66

INDEPENDENT AUDITOR’S REPORT

To the Stockholders and Board of Director of

PETRODELTA, S.A.

REPORT ON THE FINANCIAL STATEMENTS

We have audited the accompanying financial statements of PETRODELTA, S.A. (a subsidiary 60% owned by Corporación Venezolana del Petróleo, S.A. CVP), which comprise the statements of financial position as at December 31, 2013, 2012, and 2011, and the statements of comprehensive income, statements of changes in equity, and statements of cash flows for the years then ended, and a summary of significant accounting policies and other explanatory information.

MANAGEMENT’S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS

Management is responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

AUDITOR’S RESPONSIBILITY

Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

2

OPINION

In our opinion, the financial statements present fairly, in all material respects, the financial position of Petrodelta, S.A. as at December 31, 2013, 2012, and 2011, and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards.

EMPHASIS OF MATTER

Without qualifying our opinion as indicated in Note 21 to the financial statements, the Company belongs to a group of related companies and conducts transactions and maintains balances for significant amounts with other members of the group, with significant effects on the results of its operations and financial position. Because of those relationships, these transactions may have taken place on terms other than those that would characterize transactions between unrelated companies.

Without qualifying our opinion, as explained in Note 21, during the years ended December 31, 2013, 2012, and 2011, the Company recorded gross unbilled revenues for the sale of crude oil in the amount of US$.566,738 thousands (Bs.3,570,453 thousands), US$.404,619 thousands (Bs.1,739,862 thousands) and US$.67,092 thousands (Bs.288,496 thousands), respectively, corresponding to the production of crude of the Campo El Salto, whose referential crude Boscan type is not contemplated in the Purchase and Sale Agreement of Oil originally signed between the Company and PDVSA Petróleo, S.A. As of December 31, 2013, 2012, and 2011, the Company has accounts receivable, net of royalties, of US$.756,695 thousands, US$.352,721 thousands and US.$.50,772 thousands (Bs.4,767,180, Bs.1,516,704 thousands and Bs.218,319 thousands), respectively, for the delivery of such crude. The Company and PDVSA Petróleo, S.A. are in the process of approval to include the pricing formula established and agreed to this crude, amend the contract, and start the billing process.

By PGFA PERALES, PISTONE & ASOCIADOS

José G. Perales S.

C.P.C. Nº 9.578

March 12, 2014

Valencia, Venezuela.

3

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Statements of Financial Position

(Expressed in thousands)

	December 31,
	Note	2013		2012		2011		2013		2012		2011
		(U.S. Dollars)						(Bolivars)
Assets
Property, plant and equipment, net	8		717,449		538,351		410,165		4,519,929		2,314,912		1,763,709
Deferred income tax	7 - f		134,238		138,492		155,062		845,693		595,516		666,767
Recoverable tax credits	7 - k		46.878		29,721		17,239		295,331		127,801		74,129
Total non-current assets			898,565		706,564		582,466		5,660,953		3,038,229		2,504,605
Prepaid expenses and other assets	9		869		1,161		523		5,475		4,993		2,248
Inventories	10		103,996		77,637		36,794		655,175		333,839		158,214
Accounts receivable	11		1,795,770		1,313,302		922,788		11,313,351		5,647,202		3,967,991
Cash and cash equivalents	12		5,960		3,335		2,342		37,548		14,336		10,071
Total current assets			1,906,595		1,395,435		962,447		12,011,549		6,000,370		4,138,524
Total assets			2,805,160		2,101,999		1,544,913		17,672,502		9,038,599		6,643,129
Total equity	13		1,016,056		760,274		674,281		6,401,153		3,269,176		2,899,407
Liabilities
Provision for asset retirement costs	14		65,616		70,425		41,518		413.381		302,828		178,527
Provision for retirement and other benefits	14		24,533		22,671		11,550		154,558		97,486		49,666
Deferred income tax	7 - f		46,149		68,066		8,606		290,739		292,684		37,006
Total non-current liabilities			136,298		161,162		61,674		858,678		692,998		265,199
Dividends payable	13		30,550		30,550		30,550		192,465		131,365		131,365
Provisions	14		1,499		1,569		1,805		9,444		6,744		7,761
Accruals and other liabilities	15		493,912		510,548		262,971		3,111,646		2,195,363		1,130,776
Accounts payable	16		912,147		544,931		340,753		5,746,526		2,343,203		1,465,241
Income tax payable	7		214,698		92,965		172,879		1,352,590		399,750		743,380
Total current liabilities			1,652,806		1,180,563		808,958		10,412,671		5,076,425		3,478,523
Total liabilities			1,789,104		1,341,725		870,632		11,271,349		5,769,423		3,743,722
Total equity and liabilities			2,805,160		2,101,999		1,544,913		17,672,502		9,038,599		6,643,129

The accompanying notes (1 to 25) are an integral part of these financial statements.

4

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Statements of Comprehensive Income

(Expressed in thousands)

		Years ended December 31,
	Note	2013			2012			2011			2013			2012			2011
		(U.S. Dollars)									(Bolivars)
Income
Sale of crude oil			1,271,596			1,157,293			1,045,224			8,011,055			4,976,360			4,494,463
Sale of natural gas			4,005			3,360			3,504			25,232			14,448			15,067
	21		1,275,601			1,160,653			1,048,728			8,036,287			4,990,808			4,509,530
Costs and expenses:
Operational expenses	17		(179,700	)		(138,605	)		(105,750	)		(1,132,110	)		(596,002	)		(454,725	)
Depletion, depreciation and amortization	8		(87,203	)		(86,005	)		(58,375	)		(549,379	)		(369,821	)		(251,013	)
Sales, general and administrative expenses			(7,611	)		(20,282	)		(8,235	)		(47,949	)		(87,213	)		(35,412	)
Royalties and other taxes	7		(566,197	)		(604,003	)		(530,476	)		(3,567,042	)		(2,597,213	)		(2,281,047	)
Contributions and fundings for social development			(17,127	)		(14,889	)		(7,241	)		(107,900	)		(64,023	)		(31,137	)
Financial income	18		147,224			—			7			927,511			—			30
Financial expenses	18		(21,734	)		(7,023	)		(10,702	)		(136,924	)		(30,199	)		(46,017	)
Other income (expenses), net			(2,274	)		(743	)		459			(14,326	)		(3,195	)		1,974
Total costs and expenses			(734,622	)		(871,550	)		(720,313	)		(4,628,119	)		(3,747,666	)		(3,097,347	)
Income before tax			540,979			289,103			328,415			3,408,168			1,243,142			1,412,183
Income tax	7 - a		(285,197	)		(203,110	)		(95,955	)		(1,796,741	)		(873,373	)		(412,606	)
Net income			255,782			85,993			232,460			1,611,427			369,769			999,577
Other comprehensive income	13		—			—			—			1,520,550			—			—
Total comprehensive income for the year			255,782			85,993			232,460			3,131,977			369,769			999,577

The accompanying notes (1 to 25) are an integral part of these financial statements.

5

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Statements of changes in equity

Years ended December 31, 2013, 2012 and 2011

(Expressed in Thousands of U.S. Dollars)

						Retained earnings
	Note	Capital Stock		Share premium		Legal Reserve and Other Reserves			Undistributed			Total equity
Balances at December 31, 2010			6,977		212,451		52,532			200,411			472,371
Total comprehensive income for the year			—		—		—			232,460			232,460
Appropriation to other reserves	13		—		—		94,622			(94,622	)		—
Dividends declared	13		—		—		—			(30,550	)		(30,550	)
Balances at December 31, 2011			6,977		212,451		147,154			307,699			674,281
Total comprehensive income for the year			—		—		—			85,993			85,993
Release from other reserves	13		—		—		(76,030	)		76,030			—
Balances at December 31, 2012			6,977		212,451		71,124			469,722			760,274
Total comprehensive income for the year			—		—		—			255,782			255,782
Appropriation to other reserves	13		—		—		17,663			(17,663	)		—
Balances at December 31, 2013			6,977		212,451		88,787			707,841			1,016,056

The accompanying notes (1 to 25) are an integral part of these financial statements.

6

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Statements of changes in equity

Years ended December 31, 2013, 2012 and 2011

(Expressed in Thousands of Bolivars)

						Retained earnings
	Note	Capital Stock		Share premium		Legal Reserve and Other Reserves			Undistributed			Accumulated translation adjustment			Total equity
Balances at December 31, 2010			15,000		456,770		224,385			421,460			913,580			2,031,195
Total comprehensive income for the year	13		—		—		—			999,577			—			999,577
Appropriation to other reserves	13		—		—		406,875			(406,875	)		—			—
Dividends declared	13		—		—		—			(131,365	)		—			(131,365	)
Balances at December 31, 2011			15,000		456,770		631,260			882,797			913,580			2,899,407
Distribution of accumulated translation adjustment to equity accounts	13		15,000		456,770		142,353			299,457			(913,580	)		—
Total comprehensive income for the year			—		—		—			369,769			—			369,769
Release from other reserves	13		—		—		(326,928	)		326,928			—			—
Balances at December 31, 2012			30,000		913,540		446,685			1,878,951			—			3,269,176
Total comprehensive income for the year			—		—		—			1,611,427			1,520,550			3,131,977
Appropriation to other reserves	13		—		—		111,277			(111,277	)		—			—
Balances at December 31, 2013			30,000		913,540		557,962			3,379,101			1,520,550			6,401,153

The accompanying notes (1 to 25) are an integral part of these financial statements.

7

PETRODELTA, S.A

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Statements of Cash Flow

(Expressed in thousands)

	Years ended December 31,
	2013			2012			2011			2013			2012			2011
	(U.S. Dollars)									(Bolivars)
Cash flow from operating activities:
Net income		255,782			85,993			232,460			1,611,427			369,769			999,577
Adjustments to reconcile net income to net cash (used in) provided by operating activities -
Depletion, depreciation and amortization		87,203			86,005			58,375			549,379			369,821			251,013
Change in estimation of provision for asset retirement costs		8,823			(23,229	)		(7,644	)		55,585			(99,886	)		(32,869	)
Asset retirement loss, net		1,380			—			—			8,694			—			—
Provision for income tax		325,217			127,080			190,577			2,048,867			546,444			819,481
Deferred income tax provision		(40,020	)		76,030			(94,622	)		(252,126	)		326,929			(406,875	)
Financial cost on provision for asset retirement obligation		5,046			5,678			4,076			31,790			24,415			17,527
Financial income from variation in the exchange rate		(147,224	)		—			—			(927,511	)		—			—
Tax credit financial cost		20,748			1,339			6,623			130,712			5,759			28,477
Changes in operating assets -
Prepaid expenses and other assets		(48	)		(638	)		(117	)		(302	)		(2,745	)		(498	)
Material and supplies inventories		(33,877	)		(47,585	)		(12,921	)		(213,425	)		(204,616	)		(55,560	)
Accounts receivable		(540,132	)		(404,335	)		(432,222	)		(3,402,832	)		(1,738,642	)		(1,858,556	)
Changes in operating liabilities -
Provisions		4,187			39,792			14,538			26,378			171,104			62,514
Accruals and other liabilities		102,327			241,899			89,578			644,660			1,040,172			385,188
Accounts payable		397,840			204,178			288,659			2,506,392			877,962			1,241,229
Income tax paid		(173,971	)		(206,994	)		(182,197	)		(1,096,017	)		(890,074	)		(783,447	)
Total adjustments		17,499			99,220			(77,297	)		110,244			426,643			(332,376	)
Net cash provided by operating activities		273,281			185,213			155,163			1,721,671			796,412			667,201
Cash flow (used in) provided by investing activities:
Acquisition of property, plant and equipments		(269,236	)		(184,220	)		(137,956	)		(1,696,187	)		(792,147	)		(593,211	)
Asset retirement		250			—			—			1,575			—			—
Net cash used in investing activities		(268,986	)		(184,220	)		(137,956	)		(1,694,612	)		(792,147	)		(593,211	)
Cash flow used in financing activities:
Dividends paid		—			—			(18,330	)		—			—			(78,819	)
Net cash used in financing activities		—			—			(18,330	)		—			—			(78,819	)
Effect for variation in the exchange rate in cash and cash equivalents		(1,670	)		—			—			(10,521	)		—			—
Effect for variation in the exchange rate in the foreign currency		—			—			—			6,674			—			—
Net cash (decrease) increase		2,625			993			(1,123	)		23,212			4,265			(4,829	)
Cash and cash equivalents at the beginning of the year		3,335			2,342			3,465			14,336			10,071			14,900
Cash and cash equivalents at the end of the year		5,960			3,335			2,342			37,548			14,336			10,071

The accompanying notes (1 to 25) are an integral part of these financial statements.

8

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(1) Reporting Entity

Petrodelta, S.A. was incorporated and is domiciled in the Bolivarian Republic of Venezuela and its main offices are located at Avenida Alirio Ugarte Pelayo, Edificio Petrodelta, Ala Norte, Planta Baja in Maturín, Monagas State. Its legal address is: Avenida Veracruz con Calle Cali, Urbanización Las Mercedes, Edificio Pawa, Piso 5, Caracas, Distrito Capital.

Petrodelta, S.A. (the Company) was incorporated in October 2007, as published in Official Gazette No. 38,786. Its business objective is primary exploration to discover oil reserves, extraction of oil in its natural state, and its subsequent collection, transportation and storage pursuant to Article No. 9 of the Venezuelan Hydrocarbon Law (LOH). The Company operates within an area of approximately 1,000 square kilometers in the Uracoa, Bombal, and Tucupita fields (formerly the Monagas Sur Unit) and in the El Salto, El Isleño, and Temblador fields in the Monagas and Delta Amacuro states in Venezuela (the assigned operating area).

The Company was created as a result of the process for conversion into a mixed-capital company of the Operating Agreement signed on July, 1992 between PDVSA Petróleo, S.A. (PDVSA Petróleo) (formerly Lagoven, S.A.), Harvest Natural Resources, Inc. (Harvest) (formerly Benton Oil and Gas Company) and Venezolana de Inversiones y Construcciones Clérico, C.A. (Vinccler). As part of this process, on March 31, 2006, PDVSA Petróleo, S.A., Corporación Venezolana del Petróleo, S.A. (CVP), both wholly owned subsidiaries of Petróleos de Venezuela, S.A. (PDVSA) and Harvest Vinccler, S.C.A. (HVSCA), the agreement operator and a related company of Harvest and Vinccler, signed a memorandum of understanding for conversion into a mixed company. In June 2007, the National Assembly of the Bolivarian Republic of Venezuela approved the incorporation of the mixed company Petrodelta, S.A. In August 2006, the National Assembly approved the inclusion of the Temblador, El Isleño and El Salto areas into the Monagas Sur Unit for further development of the Company’s primary activities. An agreement for conversion into a mixed company was signed between CVP and HNR Finance B.V. (HNR Finance) in September 2007. The Company will operate for 20 years as from October 2007 when the decree for transfer of field operations was published in the Official Gazette.

On May 4, 2012, the National Executive of the Venezuelan Bolivarian Republic published in the Official Gazette No. 39,915, by means of a decree-law No. 8,896 created PDVSA Social, S.A. (PDVSA Social), an affiliate of Petróleos de Venezuela, S.A. and ordered CVP to transfer 4% of its capital stock in mix companies of the oil industry to PDVSA Social. In August 14, 2012, shareholders of the Company approved the transfer of CVP´s 4% capital stock in Petrodelta, S.A. to PDVSA Social. Therefore, the capital stock of the Company is 56%-owned by Corporación Venezolana del Petróleo (CVP) and 4% owned by PDVSA Social, S.A. and 40%-owned by HNR Finance.

Company management considers that it operates in a single business segment (hydrocarbons) and in one country, the Bolivarian Republic of Venezuela, in conformity with its social statutes.

During the transition period from April 1, 2006 to December 31, 2007, Harvest Vinccler, S.C.A. (HVSCA) was in charge of managing and developing the Company’s activities and provided its financial and operational structure for this purpose. The Company’s operating costs during this period were paid by HVSCA and CVP and subsequently charged to PDVSA, which, in turn, billed the Company. These costs were recognized in the statements of comprehensive income for the respective periods. These costs include, but are not limited to, general, administrative, operating and capital expenses required to continue activities in the assigned operating area.

9

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

At December 31, 2013, 2012 and 2011 the Company had not received information regarding production from the Temblador field for the period starting October 23, 2007, official date of the decree of transferring field operations to the Company, and ending February 1, 2008. Because production was handled during this period by PDVSA as well as related operational expenses, investments, taxes and contributions by law associated, the Company started discussions to obtain information and evaluate if merits exists for an eventual reconciliation of actual crude produced during the period mentioned.

During the years ended December 31, 2013, 2012 and 2011, the Company has operated with employees assigned by its shareholders or their related companies since it has no direct employees. At December 31, 2013, 2012 and 2011, the Company has 638, 635 and 527 employees, respectively, assigned by its shareholders or their related companies.

During the year ended December 31, the Company drilled 13 (2013), 12 (2012) and 15 (2011) development wells, produced and sold approximately 14.5 (2013), 13.2 (2012) and 11.4 (2011) million barrels of oil and sold 2,6 (2013), 2.1 (2012) and 2.3 (2011) billion cubic feet of natural gas.

Regulations

The Company’s main activities are regulated by the Venezuelan Hydrocarbon Law (LOH), effective from January 2002 and its partial reform of May 2006. Gas-related operations are regulated by the Venezuelan Gaseous Hydrocarbon Law effective since September 1999 and its Regulation of June 2000, by the provisions of the bylaws and common rights norms applicable.

Below are the main regulations included in the LOH:

a) A 30% royalty on volumes of hydrocarbon extracted (see Note 7-g).

b) A Partial Reform of the Extraction Tax was enacted and published in Official Gazette No. 38,443 of May 24, 2006, establishing a rate equivalent to one-third of the value of all liquid hydrocarbons extracted from any reservoir, calculated on the same basis set out in the Law for royalty calculation. The taxpayer has the right to deduct from the extraction tax any sum payable as royalties (30%), including the additional royalty paid for special advantages (3.33%).

c) A surface tax equivalent to 100 tax units for each square kilometer or fraction thereof per year for licensed areas that are not under production. This tax will increase by 2% during the first five years, and by 5% during all subsequent years.

d) An internal consumption tax equivalent to 10% of the value of each cubic meter of hydrocarbon derivatives produced and consumed as fuel in internal operations, calculated on the final selling price. Company management considers that, other than associated gas, no hydrocarbon derivatives are consumed (see Note 7-j).

10

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

Hydrocarbon Purchase Sale Agreement

On January 17, 2008, the Company signed a hydrocarbon purchase sale agreement with PDVSA Petróleo, whereby the Company undertakes to sell to the latter all hydrocarbons produced within the delimited operating area that are not being used in its operations. The Company may assign or transfer this agreement, or any rights and obligations thereunder, to another company in accordance with Article No. 27 of the LOH. This agreement is for 20 years.

In October 2011, the Company began to deliver production from El Salto field to the COMOR transfer point, EPM-1 storage facility at PDVSA Morichal which serves as a reception and dispatch of crude for its proximity to El Salto field. Since that date, MPPPM determined that Petrodelta’s production flowing through the COMOR transfer point was of lower quality and higher sulphur content, and instructed the Company that invoicing of crude from El Salto field from October 2011 must be made in reference to a similar gravity crude and not using the crude currently in the purchase sale contract. On December 17, 2012 the Company received from PDVSA Marketing and Supply a proposal to amend the purchase sale agreement with PDVSA Petróleo to invoice the production from El Salto field. This amendment incorporates a new pricing formula in addition to the one currently using Merey 16 as a reference to bill the volumes produced by the Company and include Boscán crude as a reference adjusting the transportation and commercialization costs to invoice that production with lower quality and higher sulphur content coming from El Salto field. The Company has agreed to amend the purchase sale agreement which will permit it to bill the production delivered from El Salto field that since October 2011 it has not being able to be invoiced.

On January 31, 2013, the Board of the Company endorsed the incorporation of the oil price formula with reference to Boscan in the hydrocarbons purchase sale agreement and instructed to submit the formula to the corresponding National Executive administrative and financial authority level, and for the approval of the Petrodelta, S.A. Shareholders, which will allow the billing of the production of crude from El Salto field.

On May 2, 2013, shareholders of the Company and on April 30, 2013 the board of directors of CVP resolved to endorse the proposal of the Company to amend the hydrocarbon purchase sale agreement with PDVSA Petróleo, S.A. to include the Price Formula with crude Reference Boscan, before the Ministry of People Power of Oil and Mining so it can sign the amended agreement for the Company to start invoicing production from El Salto field.

(2) Basis of Preparation

(a) Statement of Compliance

The financial statements as of December 31, 2013, 2012 and 2011 are prepared in accordance with International Financial Reporting Standards (IFRS) adopted by the International Accounting Standards Board (IASB) and their interpretations, issued by the International Financial Reporting Interpretations Committee (IFRIC) of the IASB.

11

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

On March 12, 2014, March 1, 2013 and February 23, 2012, the Board of Directors of the Company approved the issuance of the financial statements as of December 31, 2013, 2012 and 2011, respectively, in accordance with International Financial Reporting Standards (IFRS) and resolved to submit these financial statements to the Shareholders of the Company and expect their approval with no modifications. On February 28, 2013 and October 17, 2013, Shareholders of the Company resolved to approve the financial statements for the years ended December 31, 2011 and 2012, respectively. The corresponding minutes for these assemblies have been issued and are expected to be signed by the Company representatives, (see Note 24-d).

(b) Basis of Measurement

The financial statements have been prepared on the historical cost basis, except for certain assets and liabilities measured at fair value. Assets measured and presented at fair value are: recoverable tax credits, accounts receivable and cash and cash equivalents.

The methods used for measuring fair value are discussed in more detail in Note 5.

(c) Functional and Presentation Currency

The financial statements are presented in U.S. Dollar (dollar or US$.) and bolivars (bolivars or Bs.). The Company’s functional currency is the dollar, since the main economic environment in which Petrodelta, S.A. operates is the international market for crude oil and its products. In addition, a significant portion of its revenues, as well as most costs, expenses and investments are denominated in dollars.

The financial statements in bolivars are presented for statutory purposes.

All financial information presented in U.S. dollars and bolivars has been rounded in thousands.

(d) Use of estimates and judgments

The preparation of financial statements in conformity with IFRS requires management to make estimates, judgments and assumptions that affect the application of accounting policies and the amounts of assets, liabilities, income and expense. The Company applies its best estimates and judgments; however, actual results may differ from initial estimates.

Estimates and assumptions are reviewed periodically, and the effects of the revisions, if any, to accounting estimates are recognized in the period in which the estimate is revised and in any future periods affected.

Significant areas of critical judgment in the application of accounting policies, which significantly affect financial statement amounts, are described in the following notes:

• Note 3-g and 8—depletion, depreciation and amortization

• Note 3-h and 14—provision for asset retirement costs

• Note 3-f and 19—valuation of financial instruments

12

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

Information on areas of uncertainty affecting management’s estimates which significantly affect financial statement amounts in future periods are described in the following notes:

• Notes 3-r and 14—measurement of contract-based retirement benefit obligations and other post-retirement benefits other than pensions, which is a PDVSA obligation with the employees assigned to the Company for subsequent billing once the employee is considered eligible for pension.

• Notes 3-d and 7-f—deferred income tax

• Notes 3-m and 20- commitments, contingencies and provisions in respect of environmental issues

The Company’s operations may be affected by the political, legislative, regulatory and legal environment, both at the national and international level. In addition, significant changes in prices or availability of crude oil and its products may have an impact on the Company’s results of operations in any given year.

(3) Summary of Significant Accounting Policies

The accounting policies used for the preparation of these financial statements have been applied consistently for all periods presented and are summarized as follows:.

(a) Foreign Currency

Transactions in Foreign Currency

Transactions in foreign currency (any currency different than the functional currency) are translated into the Company’s functional currency using the exchange rate in effect at the transaction date. Monetary assets and liabilities denominated in foreign currency are translated into U.S. dollars using the exchange rate prevailing at the date of the statement of financial position. Exchange gains or losses on monetary assets and liabilities resulting from this translation are presented as financial income or expenses in the statements of comprehensive income. Nonmonetary assets and liabilities in foreign currency are stated at fair value and translated to the functional currency using the exchange rate prevailing at the date fair value was determined. All other nonmonetary items denominated in foreign currency measured at historical cost are converted at the exchange rate at the date of the transaction.

Translation to the Presentation Currency

The Company’s financial statements were translated from dollars into bolivars, a currency other than the functional currency, in accordance with International Accounting Standard No. 21 the Effects of Changes in Foreign Exchange Rates. This standard requires each entity to determine its functional currency based on an analysis of the primary economic environment in which the entity operates, which is normally the one in which it primarily generates and expends cash.

13

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

The financial statements were translated into bolivars using the following procedures:

• Assets and liabilities in each statement of financial position at the exchange rates in effect at the date of such statement.

• Income and expenses in the statements of comprehensive income at the exchange rate at the date of transaction.

• All exchange gain and losses generated as a result of the above, are recognized in the statement of comprehensive income as other comprehensive income and accumulated as a separate component of equity.

• Equity accounts are translated at the exchange rate in effect at the date of each related transaction, except for retained earnings which are translated at the weighted-average rate for the relevant year.

(b) Revenue Recognition

Income from sales of crude oil and gas, is measured at fair value of the cash receipts or amounts to be received, net of commercial discounts, and is recorded in the statements of comprehensive income when risks and significant rights of ownership are transferred to PDVSA Petróleo and MPPPM as stipulated in the hydrocarbon purchase sale agreement. Income is recognized when it can be reasonably measured and it is probable that future economic benefits will flow to the Company. Income from activities other than the Company’s main business is recognized when realized. Income is not recognized when there is significant uncertainty as to the recoverability of the obligation acquired by the buyer. All of the Company results are from continuing operations. The Company records revenue from the sale of crude by i) 70% of volumes it transfers and invoices to PDVSA Petróleo and ii) royalty paid in kind equivalent to 30% of production delivered (see Notes 3-n, 7-g and 21).

(c) Financial Income and Expenses

Financial income included in the statements of comprehensive income represents mainly the effects originated by modifications and dispositions in relation to exchange rate agreements (see Note 18).

Financial expenses included in the statements of comprehensive income represents changes (losses) in the fair value of financial assets (see Note 7-k) and the asset retirement obligation (see Notes 3-g and 3-m).

Income and losses in foreign currencies are recognized on a net basis, either as financial income or financial expense, depending on the effect of foreign currency fluctuations resulting from a net asset or liability position.

14

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(d) Income Tax

Income tax expense comprises current and deferred income tax. Income tax expense is recognized in the results for each year, except to the extent that it relates to items that should be directly recognized in other comprehensive income.

Current income tax is the expected tax payable based on the taxable income for the year, using the methodology established by current laws and tax rates at the reporting date and any adjustment to taxes payable from previous years. Current income tax payable also includes tax responsibility derived from dividends declared.

Deferred income tax is recognized using the balance sheet liability method. Deferred tax assets and liabilities are recognized by the timing differences that exist between assets and liabilities values presented in the statement of financial position and their corresponding tax value, as well as operating losses and tax credit carry-forwards. The value of deferred tax assets and liabilities is determined based on tax rates expected to be applicable to taxable income for the year in which temporary differences will be recovered or settled pursuant to law. The effect on deferred tax assets and liabilities of changes in tax rates is recorded in the results for the year in which such changes become effective.

A deferred tax asset is recognized only to the extent that future taxable income will be available for offsetting. Deferred tax assets are reviewed at each reporting date and reduced to the extent that it is no longer probable that the related tax benefit will be realized.

(e) Contributions and Funding for Social Development

Corresponds to contributions and funding the Company is obliged by law to carry out and are paid and recovered by PDVSA. These contributions are funding for endogenous projects, programs related to science, technology and innovation and funding of national programs in relation to antidrug activities and Sports Organic Law.

(f) Financial Instruments

Non-derivative financial instruments consist of recoverable tax credits, accounts receivable, cash and cash equivalents, accounts payable to suppliers, and other liabilities (see Note 5).

Non-derivate financial instruments classified as at fair value through profit or loss are initially recognized at fair value, plus any direct transaction costs.

Recoverable tax credits are accounted for at fair value after its initial recognition (see Note 7-k). All other non-derivative financial assets and liabilities are maintained at its original recognized value.

A financial instrument is recorded when the Company engages or commits to the contractual clauses thereof. Financial assets are reversed if the Company’s contractual rights over the asset’s cash flows expire or if the Company transfers the financial asset to another entity without retaining control or a significant portion of the asset’s risks and

15

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

rewards. Regular purchases and sales of financial assets are accounted for at trade date, which is generally the date on which the Company commits to purchase or sell the asset. Financial liabilities are derecognized when the Company’s specific contractual obligation expires or is paid.

During the years ended December 31, 2013, 2012 and 2011, the Company conducted no transactions with derivative instruments.

The balance of financial assets and liabilities are offset and the net amount shown in the statement of financial position when and only when, the Company has a legal right to offset amounts and intends to settle on a net basis or to realize the asset and settle the liability simultaneously.

(g) Property, Plant and Equipment

Recognition and measurement

Property, plant and equipment are stated at cost, net of accumulated depreciation and impairment losses (see Note 3-l). The successful efforts accounting method is used for exploration and production activities of crude oil and natural gas, taking into consideration what is established under IFRS 6 Exploration For and Evaluation of Mineral Resources in relation to accounting for exploration and evaluation expenditures, including the recognition of exploration and evaluation assets. All costs for development wells, related plant and equipment, and property used for oil recovery are recorded as part of the cost of the assets. Costs of exploratory wells are capitalized until it is determined whether they are commercially feasible; otherwise, such costs are charged to operating expenses. Other exploratory expenditures, including geological and geophysical costs, are expensed as incurred.

The cost of property, plant, and equipment includes disbursements that are directly attributable to the acquisition of such assets and the amounts associated with asset retirement costs (see Note 3-h).

Finance costs of projects requiring major investments, and costs incurred for specific financing of projects, are recognized as part of property, plant, and equipment, when they can be directly related to the construction or acquisition of a qualifying asset. Capitalization of such costs is suspended during periods when the development of construction activity is interrupted, and capitalization ends when necessary activities are substantially complete for the utilization of a qualifying asset. An asset is considered qualified, when it requires a period of substantially time necessary before is ready for use.

The cost of assets built by the Company includes materials and direct labor, as well as any other direct cost attributable to bringing the asset to working condition. Costs for dismantling and removal from the construction site are also included.

All disbursements relating to construction or purchase of property, plant and equipment in the stage prior to implementation are stated at cost as work in progress. Once the assets are ready for use, they are transferred to the respective component of property, plant, and equipment and depreciation or amortization commences.

16

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

Gain or loss generated by the sale, retirement or disposal of an asset from property, plant, and equipment, is determined by the difference between the amount received from sale, retirement or disposal, if any, and the net carrying value in the books of the Company, and is recognized as other income or expense, net in the statements of comprehensive income.

Materials and supplies accounted for as inventory and considered strategic since they will be used as spare parts for two years operation in the production facilities and in specific investment projects are reported under property, plant, and equipment.

Subsequent Costs

Costs for major maintenance or general repairs, as well as replacement of significant parts of property, plant and equipment are capitalized when identified as a separate component of the asset to which such maintenance, repair and replacement corresponds and are depreciated between one maintenance period and the other. Disbursements for minor maintenance, repairs and renewals incurred to maintain facilities in operating conditions are expensed.

Depletion, Depreciation and Amortization

Depletion, depreciation, and amortization of capitalized costs related to wells and facilities for the production of crude oil and gas are determined by the units of production method by field, based on proved developed reserves, which include quantities of oil and gas that can be recovered from existing wells, with equipment and methods currently in use. The rates used are reviewed annually based on an analysis of reserves and are applied retroactively at the beginning of the year. Capitalized costs of other property, plant and equipment are depreciated over their estimated useful lives, mainly using the straight-line method with an average useful life of 15 years for administrative buildings and between 3 and 5 years for the remaining assets

When parts of a property, plant, and equipment asset have different useful lives, they are recorded separately as a significant component of that asset.

Depreciation methods and average useful lives of property, plant, and equipment are reviewed annually. Land is not depreciated.

(h) Costs associated with Asset Retirement Costs

The Company capitalizes the fair value of costs associated with obligations from retirement of assets used for exploration and crude oil and natural gas production activities, based on the future retirement plan for those assets. Cost is capitalized as part of the related long-lived asset and is amortized over its useful life with a charge to operating costs (see Note 3-m).

17

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(i) Inventories

Inventories are stated at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the normal course of business, less costs to complete and estimated selling costs.

The cost of inventories of crude oil and its products is determined using the average cost method.

Materials and supplies are valued mainly at average cost, less an allowance for possible losses, and are classified into two groups: current assets and non-current assets.

The inventory obsolescence provision is calculated from analysis of stock behavior and aging reports that will eventually determine its use type and mobility in order to apply the corresponding obsolescence percentage.

(j) Accounts Receivable

Accounts receivable are accounted for according to price formulas established in the Hydrocarbon Purchase Sale Agreement between the Petrodelta, S.A. and PDVSA Petróleo, S.A. whereby the former undertake to sell and PDVSA Petróleo, S.A. undertakes to buy all hydrocarbons produced that are not being used in their operations within the delimited operating areas. At December 31, 2013, 2012 and 2011, the Company does not expect to incur losses on uncollectible accounts and, therefore, has not set aside a provision in this connection other than those described in the hydrocarbon purchase sale agreement with PDVSA Petróleo, S.A (see Notes 11 and 21).

(k) Cash and Cash Equivalent

Petrodelta, S.A. considers as cash and cash equivalents the cash in hands and banks. At December 31, 2013, 2012 and 2011 this amounted to approximately US$.5,960 thousands, US$.3,335 thousands and US$.2,342 thousands (Bs.37,548 thousands, Bs.14,336 thousands and Bs.10,071 thousands), respectively (see Note 12).

(l) Impairment in the Value of Assets

Non-derivative Financial Assets

Financial assets are assessed by the Company at the date of the financial statements to determine whether there is any objective evidence of impairment. A financial asset is impaired if there is objective evidence that one or more events have had a negative effect on the estimated future cash flows of the asset (see Note 6).

Objective evidence that financial assets are impaired can include default or lack of compliance from debtors, restructuring a balance due to the Company in terms that may not be considered in other circumstances, signs that a debtor or issuer declares bankrupt or the instrument no longer has a market.

18

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

Significant financial assets are reviewed individually to determine their impairment. The remaining financial assets with similar credit risk characteristics are evaluated as a group.

In evaluating impairment, the Company uses historical trends of the probability of defaults, timing of recoveries and the amount of loss incurred, adjusted for management’s judgment as to whether current economic and credit conditions are such that the actual losses are likely to be greater or less than the suggested by historical trends.

An impairment loss related to a financial asset is calculated as the difference between its carrying amount and the present value of the estimated future cash flows, discounted at the effective interest rate. Impairment losses are recognized in the statements of comprehensive income. An impairment loss is reversed if the amount can be related objectively to an event occurring after the impairment loss was recognized (see Note 19).

Non-Financial Assets

The carrying amounts of non-financial assets, excluding inventory and deferred tax, are reviewed at each reporting date of the statement of financial position to determine whether evidence of impairment exists. If any such indication exists, then the recoverable value of the asset is estimated.

The recoverable value of an asset or cash-generating unit is the greater of its carrying value and its fair value, less direct selling expenses. When determining the carrying value, expected future net cash flows are discounted using present value techniques, using a discount rate before tax that reflects current market conditions over the time value of money and specific risks that the asset may bear. Impairment is determined by the Company based on cash-generating units, in accordance with its business segments, geographical locations and the final use of the production generated by each unit. A cash-generating unit is the assets grouped at the lowest levels for which there are separately identifiable cash flows. When evaluating impairment, goodwill acquired during business combinations is allocated among cash-generating units that are expected to benefit from combination synergies.

An impairment loss is recognized when the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. Impairment loss is recognized in the statements of comprehensive income for the year and the asset cost is shown net of this impairment charge.

Impairment losses can be reversed only if the reversion is related to a change in the estimates used after the impairment loss was recognized. This reversion shall not exceed the book value of assets net of depreciation or amortization as if the impairment had never been recognized. Impairment losses associated to goodwill are not reversed.

(m) Provisions

A provision is recognized if, as a result of a past event, the Company has a present legal or constructive obligation that can be reliably estimated, and it is probable that an outflow of economic benefits will be required to settle the obligation. When the effect of the time value of money is significant, the provision is determined by applying a discount rate associated with the estimated payment terms, if the terms can be estimated reliably as well as the risk associated with those obligations.

19

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

Environmental Issues

In conformity with the environmental policy established by the Company and following instructions from PDVSA and applicable current legislation, a liability is recognized when costs are likely and can be reasonably estimated. Environmental expenditures that relate to current or future revenues are expensed or capitalized as appropriate. Expenditures for past operations that do not contribute to generating current or future income are charged to expense. Recognition of these provisions coincides with the identification of an obligation for environmental remediation where Petrodelta, S.A. has sufficient information to determine a fair estimate of the respective cost. Subsequent adjustments to estimates, if necessary, are made upon obtaining additional information (see Notes 14 and 20).

Asset Retirement

Obligations associated with the retirement of long-lived assets are recognized at fair value on the date on which such obligation is incurred, based on future discounted cash flows. The fair values are determined based on current regulations and technologies.

Changes in fair values of obligations are added to or deducted from the cost of the respective asset. The adjusted depreciation amount of the asset is depreciated over its remaining useful life. Therefore, once its useful life has ended all subsequent changes in the fair value of the obligation are recognized in the statements of comprehensive income. The increase in the obligation for each year is recognized in the results of operations as financial expenses (see Note 14).

Litigation and Other Claims

Provision for litigations and claims are recognized in the event that legal action has been lodged, government investigations have been initiated and other legal actions are outstanding or subject to be filed in the future against the Company, as a result of past events, which may result in a probable outflow of economic benefits to pay for that obligation which may be reliably estimated (see Note 20).

Damages to Land

Liabilities for damage to land is recorded as a result of the regular activities carried out by the Company to access the different existing areas or new, for which third-party property or economic activity can be or are affected causing the need to compensate the economic effects caused.

As a result of the expansion of the activities during the years 2011 to 2013, the Company caused damages to third parties and currently is in negotiation process with different owners. Management estimated potential liabilities as of December 31, 2013, 2012 and 2011 (see Note 20).

20

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(n) Royalties, extraction tax and other taxes

Royalties, extraction tax, and other related taxes are calculated according to the provisions of the Hydrocarbons Law and other laws regulating the oil industry (see Notes 1 and 7) and are recognized in the statements of comprehensive income when caused. Royalty for the sale of crude is paid in kind (see Note 3-b) and is calculated and recorded by the amount caused up to the capped price established in the decree law that created a Special Contribution on Extraordinary Prices and Exorbitant Prices in the International Hydrocarbons Market and subsequent amendments (see Note 7-g and 23-e) and not at the price oil is sold.

(o) Equity

Capital Stock

Common shares are classified as equity. For the years ended December 31, 2013, 2012 and 2011, the Company has no preferred shares (see Note 13).

Share Premium

The Company recognizes as share premium any excess in the value of contributions made by shareholders for Company incorporation over the par value at the incorporation date (see Note 13).

Legal Reserve

The Venezuelan Code of Commerce requires companies to set aside 5% of their net income each year to a legal reserve until it reaches an amount equivalent to at least 10% of their capital stock in bolivars (see Note 13).

Other Equity Reserves

The Company has the policy of transferring from retained earnings to other equity reserves the net balance of the deferred tax asset. This reserve is recognized in retained earnings to the extent that such asset gets realized when the temporary differences that gave rise to it are deducted for tax purposes and consequently would be available for dividend payments (see Note 13).

Dividend Distribution

Dividend distribution to the Company’s shareholders is recognized as a liability in the financial statements in the period in which the dividends are approved by the shareholders of the Company (see Notes 13).

21

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(p) Accounting estimates requiring a high degree of Judgment

The Company continually evaluates judgments used to record its accounting estimates, which are recorded based on historical experience and other factors, including expectation of future events that are believed to be reasonable under the circumstances. Significant future changes to assumptions established by management may significantly affect the carrying value of assets and liabilities.

Below is a summary of the most significant accounting estimates made by the Company:

Estimates of oil and gas Reserves

Oil and gas reserves are key elements in the Company’s decision-making process. They are also important in evaluating impairment in the carrying amount of long-lived assets. Calculation of depreciation, amortization and depletion of property, plant and equipment accounts related to hydrocarbon production requires quantification of proved developed hydrocarbon reserves expected to be recovered by the Company in the future. Reserve estimates are only approximate amounts due to the high degree of judgment and specialization required to develop the information. Reserves are calculated by the support of specialized technical departments at Petróleos de Venezuela, S.A. (PDVSA) (related company that owns the Company’s main shareholder) and results are submitted for approval by Ministry of Popular Power for Oil and Mining (MPPPM) in order to guarantee the reasonableness of the information. Additionally, reserve studies are regularly updated to guarantee that any change in estimates is timely recorded in the Company’s financial statements.

Reserves studies of crude oil and gas assigned to the Company are updated once a year by the superintendence of reservoir of the Company who possesses adequate technological elements necessary to determine reserves, and its impact in the statements of comprehensive income is reflected under depletion for the years ended December 31, 2013, 2012, and 2011 (see Note 25).

Assessment of impairment in the value of Property, Plant, and Equipment

Management annually assesses impairment in the value of property, plant, and equipment. The main key assumptions considered by management to determine the recoverable amount of property, plant and equipment were income projections, oil prices, royalties, operating costs and the discount rate. Projections include proved developed reserves to be produced during the development period of production activities in the assigned fields. At December 31, 2013, 2012 and 2011, the Company has not identified impairment in the carrying value of property, plant, and equipment as a result of these estimates.

Abandonment Cost Calculation

The Company’s financial statements include an asset and a provision for property, plant, and equipment used in hydrocarbon production that is expected to be abandoned in the future and in relation to which the Company will make future disbursements. Assumptions considered for the calculation of this asset and the provision for abandonment (asset abandonment costs, date of abandonment, and inflation and discount rates) may vary depending on factors such as performance in the field, changes in technology and legal requirements. Assumptions made by the Company are recorded based on technical studies and management’s experience and are regularly reviewed (see Note 14).

22

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(q) Related Party Transactions

The Company does not disclose, as part of balances and transactions with related companies (see Note 21), transactions with government entities conducted in the normal course of business, the terms and conditions of which are consistently applied to other public and private entities and for which there are no other suppliers, i.e., supplies, electricity services, taxes, among others.

(r) Accrual for Employee Benefits

Following corporate instructions, the related company PDVSA Petróleo, S.A. assumed the employer role for employees who accepted the transfer, and are working as assigned employees to Petrodelta, S.A. operations. According to this, PDVSA Petróleo, S.A. administer, prepare and pay those employees’ payroll and labor benefits and invoice direct payroll and benefits to the Company, which recognize those costs against a liability to PDVSA Petróleo, S.A. The direct payroll and benefits costs are determined by PDVSA according to the following policies:

Termination Benefits

The Company accrues for its liability in respect of employee termination benefits based on the provisions of the Venezuelan Labor Law and the prevailing oil-sector Collective Labor Agreement (see Note 22). Most of this accrual for indemnification has been deposited in trust accounts in the name of each employee. Amounts calculated for termination benefits according to the Labor Organic Law and Workers for personnel assigned by PDVSA Petróleo to the Company are calculated and recorded based on actuarial reports.

Profit Sharing and Bonuses

Liabilities in respect of labor benefits and bonuses for staff, vacation leaves, and other benefits are accounted for as incurred along with the staff’s provision of services.

During the years ended December 31, 2013, 2012 and 2011, the Company has not had direct employees and, therefore, has not recorded liabilities derived from these labor-related benefits except for the payroll related cost monthly billed to the Company by PDVSA Petróleos S.A.

Retirement Plan

The amount to be provision for retirement benefits is received from PDVSA based on actuarial studies. Net liabilities in respect of the retirement plan as defined in the contract are accounted for separately per each participant in said plan, by estimating the amount of future benefits to be acquired by staff versus their length of service during current and prior periods; said benefits are discounted in order to determine their current value, then it is deducted the fair market value of those assets associated to the plan. The discount rate

23

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

reflects the yield rate that, as of the date of the financial statements, is reported through financial instruments issued by credit institutions with high ratings and maturity dates that are in line with those due dates applicable to said liabilities. This calculation is made by an actuary by using the projected unit credit method.

Improvements made to the plan’s benefits, in connection with past service cost, are charged to the Company by PDVSA and expensed in the statements of comprehensive income over the estimated period that, on average, will last until the time that said benefits will be paid in full. As said benefits fall under irrevocable acquired rights after approval, said expense which is charged to the Company by PDVSA is recorded, immediately, in the statements of comprehensive income.

The amount accounted for as income or expense is the share corresponding to the total of unrecorded actuarial earnings or loss in excess of 10% of the greater of these sums: a) the current value of liabilities in respect of those benefits defined as of that date; and b) the reasonable value of the plan’s assets as of that date. Said caps are computed and apply separately per each plan’s benefit so defined.

Post-retirement Benefits other than Retirement

Net liabilities in respect of post-retirement benefits other than retirement, as defined in the contract, equal the total of future benefits earned by PDVSA employees assigned to the Company along with their length of service during current and prior periods. Said benefits include mainly: health and dental plans, burial and funeral insurance, and food electronic card. Said liabilities are computed by using the projected unit credit method; then they are deducted to reflect their current value and, if applicable, the fair market value of related assets is deducted as well. The discount rate reflects the yield rate that, as of the date of the financial statements, is reported through financial instruments issued by credit institutions with high ratings and maturity dates that are in line with those due dates applicable to said liabilities.

Past service cost and the actuarial income or loss are recorded by using the method set out in the retirement plan per the contract.

The provision for this concept is provided by PDVSA which is based on actuarial studies.

(s) New accounting Standards not yet Adopted

Certain new standards, amendments and interpretations to existing standards were not effective for the year ended December 31, 2013 and have not been applied in the preparation of the Company’s financial statements. The most important standards, amendments and interpretations for the Company are as follows:

• On December 12, 2013, the IASB concluded annual improvements projects to IFRSs 2010-2012 and 2011-2013 cycles amending several standards, all effective on or after July 1, 2014. Standards amended are: IFRS 2 Share-based Payment amends the definitions of vesting condition; IFRS 3 Business Combinations clarifies contingencies measurement and scope and excludes joint arrangement in the financial statements;

24

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

IFRS 8 Operating Segments on disclosures in aggregation criteria and reconciliation of reportable segments regularly; IFRS 13 Fair Value Measurements clarifies that issuing IFRS 13 and amending IFRS 9 and IAS 39 did not remove the ability to measure short-term receivables and payables with no stated interest rate at their invoice amounts without discounting if the effect of not discounting is immaterial, and also, clarifies that the scope of the portfolio exception defined in IFRS 13 includes all contracts accounted for within the scope of IAS 39 Financial Instruments: Recognition and Measurement or IFRS 9 Financial Instruments, regardless of whether they meet the definition of financial assets or financial liabilities as defined in IAS 32 Financial Instruments: Presentation; IAS 16 Property, Plant and Equipment clarifies that when an item of property, plant and equipment is revalued the gross carrying amount is adjusted in a manner that is consistent with the revaluation of the carrying amount; IAS 24 Related Party Disclosures clarifies that an entity providing key management personnel services to the reporting entity or to the parent of the reporting entity is a related party of the reporting entity; IAS 38 Intangible Assets clarifies that when an intangible asset is revalued the gross carrying amount is adjusted in a manner that is consistent with the revaluation of the carrying amount, and IAS 40 Investment Property clarifies that determining whether a specific transaction meets the definition of both a business combination as defined in IFRS 3 Business Combinations and investment property as defined in IAS 40 Investment Property requires the separate application of both standards independently of each other.

• On November 19, 2013 the IASB issued a new version of IFRS 9 Financial Instruments which includes the new hedge accounting requirements and some related amendments to IAS 39 Financial Instruments: Recognition and Measurement and IFRS 7 Financial Instruments: Disclosures. IFRS 9 also replicates the amendments in IAS 39 in respect of novations. The IASB has tentatively decided at its February 2014 meetings to select an effective date January 1, 2018 as the effective date for mandatory application of IFRS 9.

• On November 21, 2013, the IASB published narrow-scope amendments to IAS 19 Employee Benefits. The narrow scope amendments apply to contributions from employees or third parties to defined benefit plans. The objective of the amendments is to simplify the accounting for contributions that are independent of the number of years of employee service. The amendments are effective from July 1, 2014 with earlier application permitted.

• On May 29, 2013, the IASB published amendments to IAS 36 Impairment of Assets clarifying that the scope of those disclosures is limited to the recoverable amount of impaired assets that is based on fair value less costs of disposal. The amendments are to be applied retrospectively for annual periods beginning on or after January 1, 2014 but earlier application is permitted for periods when the entity has already applied IFRS 13.

• On October 31, 2012, the IASB published amendments to IFRS 10 Consolidated Financial Statements, IFRS 12 Disclosure of Interests in Other Entities and IAS 27 Separate Financial Statements in relation to Investments entities. The amendments apply to a particular class of business that qualifies as investment entities whose business purpose is to invest funds solely for returns from capital appreciation,

25

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

investment income or both. Also, the amendments provide an exception to the consolidation requirements in IFRS 10 and require investment entities to measure particular subsidiaries at fair value through profit or loss, rather than consolidate them. Under IFRS 12 the amendments also set out disclosure requirements for investment entities. These amendments are effective from January 1, 2014 with early adoption permitted.

• On December 16, 2011, the IASB published 2 amendments to IFRS 7 Financial Instruments: Disclosures. The first amendment seeks to improve disclosures related to offsetting of financial assets and financial liabilities and will be effective for fiscal periods starting January 1, 2013. The second amendment deals about disclosure in relation to first time application of IFRS 9 Financial Instruments and will be effective for fiscal periods starting January 1, 2015.

• On December 16, 2011, the IASB published amendments to IAS 32 Financial Instruments: Presentation. These amendments provide guidance when offsetting financial assets and financial liabilities. These amendments will be effective for fiscal periods starting January 1, 2014.

• On November 12, 2009, the IASB issued IFRS 9 Financial Instruments. IFRS 9 is the first phase of IFRS 9 Financial Instruments, the accounting standard that will eventually replace IAS 39 Financial Instruments: Recognition and Measurement. Later, on October 28, 2010, the IASB published requirements for financial liabilities carried forward unchanged from IAS 39. However, some changes were made to the fair value option for financial liabilities to address the issue of own credit risk. Then, on December 16, 2011, the IASB published as mandatory January 1, 2015 for certain disclosures and modified the benefits for presenting comparative periods and related disclosures. Finally in November 19, 2013, the IASB published amendments to this standard.

The Company completed the analysis of these standards and determined no significant effects on its financial statements.

(t) Recently Adopted Accounting Pronouncements

During 2013, certain standards and interpretations came into effect. The most important for Petrodelta S.A. are:

• In June 2012, the IASB published amendments that are intended to provide additional transition relief in IFRS 10 Consolidated Financial Statements, IFRS 11 Joint Arrangements and IFRS 12 Disclosure of Interests in Other Entities, by “limiting the requirement to provide adjusted comparative information to only the preceding comparative period”. Also, amendments were made to IFRS 11 and IFRS 12 to eliminate the requirement to provide comparative information for periods prior to the immediately preceding period. These amendments are effective for annual periods beginning on or after January 1, 2013.

26

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

• In May 2012, the IASB concluded the 2009-2011 upgrade cycle which affected the following standards: IFRS 1 First-time Adoption of International Financial Reporting Standards on permitting repeated application of IFRS 1 and borrowing costs relating to qualifying assets for which the commencement date for capitalization is before the date of transition to IFRSs; IAS 1 Presentation of Financial Statements in relation to clarification of requirements on comparative information; IAS 16 Property, Plant and Equipment in relation to classification of servicing equipment; IAS 32 Financial Instruments: Presentation which clarifies that tax effects of a distribution to holders of equity instruments should be accounted for in accordance with IAS 12 Income Taxes and IAS 34 Interim Financial Reporting in relation to interim reporting on segment information for total assets in order to enhance consistency with the requirements in IFRS 8 Operating Segments. These amendments are effective for annual periods beginning on or after January 1, 2013.

• In June 2011, the IASB published an amended version of IAS 19: Employee Benefits, effective for annual periods beginning on or after January 1, 2013. The amendment improve the accounting for pensions and other post-retirement benefits by providing investors and other users of financial statements with a much clearer picture of an entity´s obligations resulting from the provision of defined benefit plans and how those obligations will affect its financial position, financial performance and cash flow.

• In May 2011, the IASB published amendments and new standards effective for annual periods beginning on or after 1 January 2013. A summary of these publications are as follows:

• IAS 27 Consolidated and Separate Financial Statements: now only contains requirements related to Separate Financial Statements, changing therefore the title to Separate Financial Statements, and adding requirements for Separate Financial Statements in IAS 28 Investments in Associates and IAS 31 Interests in Joint Ventures. Application is allowed before entry into force.

• IAS 28 Investments in Associates and Joint Ventures: it was the project of joint venture of the Board of International Accounting Standards, who decided to incorporate the accounting for joint ventures in IAS 28 because the equity method is applicable to joint ventures and associates. Because of this, the title was changed to Investments in Associates and Joint Ventures. Application is allowed before entry into force.

• IFRS 10 Consolidated Financial Statements which is a replacement of sections of IAS 27 Separate Financial Statements and in its entirety of SIC 12 Consolidation – Special Purposes Entities: looks for having a single basis for consolidation for all entities. It is based on existing principles by identifying the concept of control as the determining factor in whether an entity should be included in the parent’s consolidated financial statements. The standard provides additional guidance to assist in determining control where it is difficult to assess. From its effective date, it eliminates IAS No. 27 and SIC 12 regardless of the nature of the investee, and that basis is control.

27

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

• IFRS 11 Joint Arrangements it provides a more realistic reflection of these businesses, focusing on the rights and obligations of the same, rather than its legal form (as is currently the case). The standard addresses inconsistencies in the reporting of joint ventures by requiring a single method to account for interests in jointly controlled entities form. Proportionate consolidation option is removed. From its effective date, it eliminates IAS No. 31 and SIC 13

• IFRS 12 Disclosure of Interests in Other Entities require extensive disclosures relating to an entity´s interests in subsidiaries, joint arrangements, associates and unconsolidated structured entities to help users of its financial statements evaluate the nature of and risks associated with its interests in other entities and the effect of those interests in its financial statements.

• IFRS 13 Fair Value Measurement establishes a single framework for measuring fair value required by other Standards and applies to both financial and non-financial items measured at fair value.

The Company’s accounting policies have been revised and modified, when necessary, to adopt the requirements established in these new standards or interpretations. Adoption of these standards and interpretations did not significantly affect the Company’s financial statements.

(4) Exchange Agreement with the Central Bank of Venezuela (BCV)

On December 30, 2013, Foreign Exchange Agreement No. 24 was published in the Official Gazette No. 40,324. This Exchange Agreement between the Ministry of the People´s Power for Finance Matters and the Central Bank of Venezuela (BCV) established among other things the buying exchange rate applicable to Petróleos de Venezuela, S.A. and its subsidiaries including mix companies created in accordance within the provision of the Organic Hydrocarbons Law, for the sale of foreign currency originated from activities different from export and or sale of hydrocarbons operations, will be equal to the exchange rate resulting from the latest foreign exchange allocation through Supplementary on Foreign Exchange Administration System (SICAD), which will be published in the website of the BCV, reduced by 0.25%. The same buying rate will apply to the sale of foreign currency transactions generated by services companies that are part of the so-called Petroleum Industrial National Conglomerate, and those who derived from mineral exports.

On February 8, 2013, was published in the Official Gazette No. 40,108, presidential decree No. 9,381 the creation of a higher rank agency to optimize the exchange rate system in order to design, plan, and execute monetary strategies by the government, to reach higher efficiency and transparency providing foreign currency to the country economic sector. Decisions from this agency will be adopted by the Ministry of People Power for Planning and Finance as well as the Venezuela Central Bank.

28

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

In May 2010, the government of the Bolivarian Republic of Venezuela established the Transactions System with Foreign Currency Securities (Sistema de Transacciones con Títulos en Moneda Extranjera (“SITME”)) for exchanging Bolivars. SITME’s purpose is to assist companies and individuals requiring foreign currency (U.S. dollars) for the import of goods and services into Venezuela. SITME may also be used for buying or selling of Venezuelan bonds. The Company does not have, and has not had, any transaction through SITME.

On December 30, 2010, Foreign Exchange Agreement No. 14, effective as of January 1, 2011, was published in Official Gazette 39,584. This Agreement sets the exchange rate at Bs.4.2893 per U.S. Dollar for purchases and Bs.4,30 per U.S. dollar for sales. This resolution supersedes Foreign Exchange Agreement No. 14, dated January 8, 2010, published in Official Gazette of the Bolivarian Republic of Venezuela 39,342, dated January 8, 2010; as well as Foreign Exchange Agreements No. 15, No. 16, No. 17, and any other provision that may come into conflict with this Foreign Exchange Agreement.

The pronouncement of the Exchange Agreement No. 14 did not have an effect on the Company’s right to maintain foreign currency funds at financial institutions outside the country on revenues proceeds from sale of crude in order to make payments and disbursements (see Note 23-f).

On November 21, 2005, the Exchange Agreement No. 9 was published in the Official Gazette No. 38,318, later revised on March 22, 2007 and published in the Official Gazette No. 38.650, which establishes that foreign currency obtained from hydrocarbon exports, must be sold to the Venezuelan Central Bank (BCV), except for foreign currency earmarked for activities conducted by PDVSA in conformity with the BCV Law Reform. Under this agreement, PDVSA and its subsidiaries may not maintain foreign currency funds in Venezuela for more than 48 hours, and establishes how these funds will be used by PDVSA.

(5) Determination of Fair Values

Certain of the Company’s accounting policies and disclosures require the determination of fair values for financial and non-financial assets and liabilities. Fair values have been estimated for purposes of valuation and disclosure using available market information and appropriate valuation methods. When applicable, additional information on fair value estimates of assets and liabilities is disclosed in the specific notes to the statements of financial position.

Non-Derivative Current Financial Assets and Liabilities

The carrying amounts of financial assets and liabilities included in prepaid expenses and other assets, accounts receivable, cash and cash equivalents and accounts payable to suppliers approximate their fair value because of the short-term maturities of these instruments.

The fair value of recoverable tax credits and other liabilities has been determined by discounting their carrying value based on estimation of future collections and payments, using interest rates calculated according to the inherent risk of the assessed instrument such as credit quality, liquidity, currency and other factors (see Note 7-k).

29

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

The net carrying value of the account payable to PDVSA approximates the estimated fair value since its payment depends on the volume and nature of transactions conducted by the Company with the parent Company and its subsidiaries.

Derivative Financial Assets and Liabilities

The fair value of derivative financial instruments is based on the amount that the Company will receive or pay to terminate the agreements, taking into account current commodity prices, interest rate and the current creditworthiness of the parties involved. During the years ended December 31, 2013, 2012 and 2011, Petrodelta, S.A. did not engage in operations involving derivative financial instruments.

Non-Derivative Financial Obligations

The fair value of non-derivative financial obligations, which is determined for disclosure purposes, is calculated based on information provided by financial institutions and the present value of future principal and interest cash flows, discounted at the market interest rate at the reporting date, based on the inherent risk of those obligations. During the years ended December 31, 2013, 2012 and 2011, the Company did not engage in operations involving non derivative financial debt instruments.

Accounts Payable with Related Parties

The value of accounts payable to related parties approximate their fair value and are settle upon decisions adopted by PDVSA.

(6) Financial Risk Management

Local and international conditions, such as recession periods, inflation, interest rates, devaluation, and hydrocarbon price volatility may have a significant effect on the Company’s financial position. The Company is exposed to a variety of financial risks: market risk (including exchange rate fluctuation risk, interest rate risk and price risk), liquidity risk and capital risk. Financial instruments exposed to concentration of credit risk consist primarily of cash and trade accounts receivable.

At December 31, 2013, 2012 and 2011, the Company’s cash is placed with local and foreign financial institutions. In addition, there is some concentration of credit risk in trade accounts receivable since all crude oil and gas produced is sold to PDVSA Petróleo, S.A.

Market Risk

Market risk is the risk that changes in market prices, including foreign exchange rates, interest rates or sales prices, will affect the Company’s income or the value of its financial instruments. The Company’s general risk management focuses on the uncertainty surrounding financial markets and seeks to minimize the potential adverse effects on the Company’s financial performance.

30

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

The Company is exposed to risks stemming from changes in the sale price of hydrocarbons, which depend on external market factors. At December 31, 2013, 2012 and 2011, hydrocarbon sales prices are calculated based on predetermined formulas that consider the price of hydrocarbons in different international markets. Price fluctuations may have a significant impact on the Company’s income. At December 31, 2013, 2012 and 2011, the Company has no mechanisms in place to protect against exposure to hydrocarbon sales price fluctuations.

In addition, the Company operates in Venezuela and is exposed to foreign exchange risk from variations in the exchange rate of the Bolívar relative to the U.S. dollar. Foreign exchange risk is mainly derived from future commercial operations and assets and liabilities recognized in bolivars.

The Company has accounts receivable to PDVSA which earn interest on arrears 45 days after bills are due and is, therefore, exposed to interest rate fluctuation.

Liquidity Risk

It is the risk that the Company will not be able to comply with its financial liabilities through their maturity. The approach the Company maintains to manage this risk implies having enough cash and temporary investments as well as the availability of funds provided by its main shareholder, who supplies funds according to the Company needs. The Company permanently evaluates its future cash flows through short and long term projections from estimated sales and cash requirements which correspond mainly to operation and maintenance of production facilities.

Capital Risk

The Company is focused on safeguarding its ability to continue as a going concern, so that it can be strength and motor development of the region in which the Company operates, it allows to provide returns shareholders and to maintain an optimal capital structure to reduce the cost of capital. Capital consists of share capital, share premium, and retained earnings.

The Company’s strategy has been progressively strengthening its equity situation through adjustments in light of changes in economic conditions and the risk characteristics of the operations. To strengthen the capital structure, the Company may decide on the strategy paid dividends, the creation or transfer of reserves and the sale of assets.

31

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(7) Taxes and Royalties

Below is a summary of taxes affecting the Company’s operations, stated (in thousands):

	Years ended December 31,
	2013			2012		2011			2013			2012		2011
	U.S. Dollars								Bolívar
Income tax expense (benefit):
Current income tax expense		325,217			127,080		190,577			2,048,867			546,444		819,481
Deferred income tax (benefit) expense		(40,020	)		76,030		(94,622	)		(252,126	)		326,929		(406,875	)
Total income tax expense		285,197			203,110		95,955			1,796,741			873,373		412,606
	Years ended December 31,
	2013			2012		2011			2013			2012		2011
	U.S. Dollars								Bolívars
Royalties and other taxes:
Royalty on oil production (See Note 21)		343,331			276,620		260,007			2,162,985			1,189,466		1,118,030
Royalty on gas production (See Note 21)		4,492			4,289		3,415			28,300			18,443		14,685
Royalty for the municipalities		12,870			10,394		9,729			81,081			44,694		41,835
Royalty for endogenous development projects		25,739			20,787		19,458			162,156			89,384		83,669
Surface tax		480			558		235			3,024			2,399		1,011
Windfall tax (see Note 7-l and 7-m)		234,453			291,355		237,632			1,477,054			1,252,827		1,021,817
Windfall tax credit (see Note 7)		(55,168	)							(347,558	)
Royalty and other taxes		566,197			604,003		530,476			3,567,042			2,597,213		2,281,047

Windfall tax credit

On March 4, 2013 Petróleos de Venezuela, S.A. requested to the Ministry of Popular for Oil and Mining an exemption to the contribution established in Article 12 of the Decree with Rank and Force of Law creating the Special Contribution for Extraordinary Prices and Exorbitant Prices in the International Oil market published in official Gazette No. 39.871 dated February 27, 2012 for the incremental production obtained during the year. For the requested exemption, the Company received from PDVSA Petróleo a credit note of US$.55,168 thousands (Bs.347,558 thousands) for the preliminary adjustment to the contribution exemption which was part of the accrual of this special contribution as of December 31, 2012. The Company has not received from the Ministry of Popular Power for Oil and Mining written submission to approve the requested exemption. This benefit is being included in the statements of comprehensive income under royalties and other taxes.

(a) Income Tax

Reconciliation between the nominal and the effective income tax rates for each year is shown below (in thousands):

				Years ended December 31,
				2013									2012									2011
	%			U.S. Dollars			Bolivars			%			U.S. Dollars			Bolivars			%			U.S. Dollars			Bolivars
Profit before income tax:
Net profit					255,782			1,611,427						85,993			369,769						232,460			999,577
Income tax expense					285,197			1,796,741						203,110			873,373						95,955			412,606
Profit before income tax					540,979			3,408,168						289,103			1,243,142						328,415			1,412,183
Oil-sector nominal income tax rate		50			270,490			1,704,084			50			144,552			621,571			50			164,208			706,092
Tax inflation adjustment		(6	)		(30,182	)		(190,147	)		(10	)		(27,971	)		(120,275	)		(9	)		(28,817	)		(123,913	)
Deferred income tax		(7	)		(40,020	)		(252,126	)		26			76,030			326,929			(29	)		(94,622	)		(406,875	)
Non-deductible provisions and other		16			84,909			534,930			4			10,499			45,148			17			55,186			237,302
Effective rate		53			285,197			1,796,741			70			203,110			873,373			29			95,955			412,606

32

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

The decrease in the effective tax rate for the year ended December 31, 2013 is mainly attributable to:

• Lower inflation adjustment in determining income tax payable offset with a higher taxable income from an increase in non-deductible expenses.

• Reduction in the deferred tax expense in relation to the year before. For the year ended December 31, 2012, the Company adjusted the deferred tax asset from non-monetary assets subject to inflation such as work in progress, fixed assets placed in service and inventories, at an exchange rate it estimated the tax benefit will be realized resulting in a reduction of the deferred tax asset recognized at the end of December 31, 2011.

As of December 31, 2013, 2012, and 2011 the Company has a balance of income tax payable, expressed in thousands, of US$.214,698 (Bs.1,352,590), US$.92,965 (Bs.399,750), and US$.172,879 (Bs.743,380), respectively.

(b) Tax Loss Carry forwards

The current Income Tax Law allows tax losses to be carried forward for three years to offset future taxable income, except losses resulting from the application of the fiscal inflation adjustment, which can be carried forward one year. At December 31, 2013, 2012 and 2011 the Company had no tax loss carry forward.

(c) Tax Inflation Adjustment

Venezuelan Income Tax Law requires an initial inflation adjustment to compute taxable income. The Law provides that the initially adjusted values of property, plant and equipment should be depreciated or amortized for tax purposes over the remaining useful lives of such assets. The Law also requires that an annual inflation adjustment be included in income tax reconciliation as a taxable or deductible item.

(d) Transfer Pricing

According to the Income Tax Law, taxpayers subject to this tax that conduct import, export and loan transactions with related parties abroad are required to calculate income, costs and deductions applying the methodology set out in the Law.

(e) Income Tax Rate

Official Gazette No. 38,529 of the Bolivarian Republic of Venezuela, published on September 25, 2006, modifies Article No. 11 of the Law regarding the rate applicable to companies engaged in hydrocarbon production and related activities, establishing a 50% general rate. However, only companies that conduct integrated or non-integrated activities related to exploration and production of non-associated gas, and processing, transportation,

33

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

distribution, storage, marketing and export of gas and its components, or those exclusively engaged in refining of hydrocarbons or enhancement of heavy and extra-heavy crude oil are subject to a 34% tax rate. Therefore, application of the 34% rate for companies incorporated under the joint venture agreements executed under the superseded Law Reserving Hydrocarbon Trade and Industry to the State is eliminated.

(f) Deferred income Tax

The movements of deferred income tax asset (liability) shown in the results of each year are as follows (in thousands):

2013:	2012 Asset (Liability)				Income (Loss) recognized in Statements of Comprehensive Income				Effect For variation in the exchange rate			2013 Asset (Liability)				Net deferred tax at December 31, 2013 (see Note 13)
U.S. Dollars-
Accounts receivable		10,995	(32,428	)		45,190	(35,096	)		(1,953	)		21,805	(35,097	)		(13,292	)
Property, plant and equipment		5,082	(27,985	)		30,759	(26,179	)		7,271			—	(11,052	)		(11,052	)
Inventories		21	(7,653	)		5,827	—			2,423			618	—			618
Accruals and other liabilities		123,394	—			58,119	(38,600	)		(30,098	)		111,815	—			111,815
		138,492	(68,066	)		139,895	(99,875	)		(22,357	)		134,238	(46,149	)		88,089
Bolivars-
Accounts receivable		47,279	(139,440	)		284,700	(221,110	)		(55,168	)		137,372	(221,111	)		(83,739	)
Property, plant and equipment		21,853	(120,336	)		193,784	(164,929	)		—			—	(69,628	)		(69,628	)
Inventories		90	(32,908	)		36,711	—			—			3,893	—			3,893
Accruals and other liabilities		526,294	—			122,966	—			55,168			704,428	—			704,428
		595,516	(292,684	)		638,161	(386,039	)		—			845,693	(290,739	)		554,954

34

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

2012:	2011 Asset (Liability)				Income (Loss) recognized in Statements of Comprehensive Income					2012 Asset (Liability)				Net deferred tax at December 31, 2012 (see Note 13)
U.S. Dollars-
Accounts receivable and other assets		9,656	—			1,339		(32,428	)		10,995	(32,428	)		(21,433	)
Property, plant, and equipment		62,520	(8,214	)		(57,438	)	(19,771	)		5,082	(27,985	)		(22,903	)
Inventories		4,182	—			(4,161	)	(7,653	)		21	(7,653	)		(7,632	)
Accruals and other liabilities		78,704	(392	)		43,690		392			122,394	—			122,394
		155,062	(8,606	)		(16,570	)	(59,460	)		138,492	(68,066	)		70,426
Bolivars-
Accounts receivable and other assets		41,521	—			5,758		(139,440	)		47,279	(139,440	)		(92,161	)
Property, plant, and equipment		268,836	(35,320	)		(246,983	)	(85,016	)		21,853	(120,336	)		(98,483	)
Inventories		17,983	—			(17,893	)	(32,908	)		90	(32,908	)		(32,818	)
Accruals and other liabilities		338,427	(1,686	)		187,867		1,686			526,294	—			526,294
		666,767	(37,006	)		(71,251	)	(255,678	)		595,516	(292,684	)		302,832
2011:	2010 Asset (Liability)				Income (Loss) recognized in Statements of Comprehensive Income					2011 Asset (Liability)				Net deferred tax at December 31, 2011 (see Note 13)
U.S. Dollars-
Accounts receivable		3,200	—			6,456		—			9,656	—			9,656
Property, plant, and equipment		18,184	(6,862	)		44,336		(1,352	)		62,520	(8,214	)		54,306
Inventories		—	(987	)		5,169		—			4,182	—			4,182
Accruals and other liabilities		38,821	(522	)		39,883		130			78,704	(392	)		78,312
		60,205	(8,371	)		95,844		(1,222	)		155,062	(8,606	)		146,456
Bolivars-
Accounts receivable		13,760	—			27,761		—			41,521	—			41,521
Property, plant and equipment		78,191	(29,507	)		190,645		(5,813	)		268,836	(35,320	)		233,516
Inventories		—	(4,244	)		22,227		—			17,983	—			17,983
Accruals and other liabilities		166,930	(2,244	)		171,497		558			338,427	(1,686	)		336,741
		258,881	(35,995	)		412,130		(5,255	)		666,767	(37,006	)		629,761

35

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(g) Royalties

According with the Venezuelan Hydrocarbon Law (LOH), royalties are paid based on crude oil produced and associated natural gas processed in Venezuela. Volumes of hydrocarbons produced in traditional areas are taxed with a 30% rate.

The partial reform of the Hydrocarbon Law was approved in May 2006, whereby operators should pay 33.33% of the wellhead value of each barrel to the Venezuelan government by means of royalties and additional taxes.

On November 14, 2006, a new calculation of royalties was established for companies that conduct primary oil activities in the country requiring that contents of sulphur and API gravity of liquid hydrocarbons extracted be measured on a monthly basis and be reported together with taxed production. This information will be part of the royalty payment price and will be used for calculation of any special advantage. This information will result in adjustments for gravity and sulphur, which will be published by Ministry of Popular Power for Energy and Mining (MPPPM).

On April 18, 2011, the Venezuelan government published in the Extraordinary Official Gazette No. 6.022, by means of decree-law No. 8.163 of same date, the Law Creating a Special Contribution on Extraordinary Prices and Exorbitant Prices in the International Hydrocarbons Market. This Law and among other things, caps royalty, extraction tax, and export register tax at US$.70 per barrel until it was amended on February 20, 2013 and published in the Official Gazette No. 40.114 which raises the cap price for royalties, extraction tax and export registry tax according to the provision in the LOH to US$.80 per barrel (see Note 23-e). Royalty under prior Law and current Law for the years ended December 31, 2013, 2012 and 2011 amounted to US$.347,823 thousands, US$.280,909 thousands and US$.263,422 thousands (Bs.2,191,285 thousands, Bs. 1,207,909 thousands and Bs.1,132,715 thousands), respectively, included in the statements of comprehensive income under royalties and other taxes (see Note 21).

(h) Extraction Tax

The Venezuelan Hydrocarbon Law Reform establishes a rate equivalent to 33.33% of the value of all liquid hydrocarbons extracted from any reservoir, calculated on the same basis as for royalties. In determining this tax, the taxpayer may deduct the amount that would have been paid for royalty, including the additional royalty paid as special advantage. Petrodelta, S.A. incurred no tax in this connection for 2013, 2012 and 2011.

(i) Surface Tax

The Venezuelan Hydrocarbon Law establishes a surface tax equivalent to 100 tax units for each square kilometer or fraction thereof per year for licensed areas that are not under production. This tax will increase by 2% during the first five years, and by 5% during all subsequent years. Petrodelta, S.A. incurred in this tax during 2013, 2012 and 2011 for US$.480 thousands, US$.558 thousands and US$.235 thousands (Bs.3,024 thousands, Bs.2,399 thousands and Bs.1,011 thousands), respectively, included in the statements of comprehensive income under royalties and other taxes.

36

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(j) General Consumption Tax

The Venezuelan Hydrocarbon Law Reform establishes an internal consumption tax equivalent to 10% of the value of each cubic meter of hydrocarbon derivatives produced and consumed as fuel in internal operations, calculated on the final selling price. During the year ended December 31, 2012, Ministry of Popular Power for Energy and Mining (MPPPM) sent to the Company the tax return to pay for this tax corresponding to the period starting January 2007 to September 2012 for the amount of US$.1,193 thousands (equivalent to Bs.5,128 thousands), whereas corresponding to the year 2012 are US$.207 thousands (Bs.890 thousands) and corresponding to the period 2007 to 2011 the amount of US$.986 thousands (Bs.4,638 thousands). All this tax levied was recorded in the statement of comprehensive income during the year 2012. For the year ended December 31, 2013 the Company recorded in the statement of comprehensive income the amount of US$.280 thousands (Bs.1,763 thousands) for general consumption tax.

(k) Value Added Tax (VAT)

On March 26, 2009, under Official Gazette No. 39,147 modification of applicable tax rate for value added tax to 12% was published, having effect from April 1, 2009 to the report date.

The VAT Law establishes an exemption on trading of certain hydrocarbon-derived fuels and also has authority to recover from the government certain tax credits originated from sales. Recoverable amounts bear no interest.

Below is a summary of the movement of recoverable tax credits (in thousands):

	December 31,
	2013			2012			2011			2013			2012			2011
	U.S. Dollars									Bolivars
Recoverable amounts at the beginning of the year		44,581			25,858			13,453			191,702			111,193			57,848
Generated during the year		32,963			20,062			19,028			207,666			86,268			81,822
Adjustment to fair value		(16,513	)		(1,339	)		(6,623	)		(104,037	)		(5,759	)		(28,477	)
Effect for variation in the exchange rate		(14,153	)		—			—			—			—			—
Recoverable amounts at the end of the year		46,878			44,581			25,858			295,331			191,702			111,193
Non-current portion of recoverable tax credits		(46,878	)		(29,721	)		(17,239	)		(295,331	)		(127,801	)		(74,129	)
Current portion of recoverable tax credits (See Note 11)		—			14,860			8,619			—			63,901			37,064

The Company management considers that the efforts made and agreements reached with the Government will not permit it to recover part of the tax credits during the year 2013.

37

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

At December 31, 2013 and 2012, the Company estimated the fair value of the tax credits to recover using the discount rate of 8.783%. At December 31, 2011 the Company estimated the fair value of these credits using a discount rate of 13.017%. These discount rates are calculated yearly by its main shareholder with the financial statements of the prior year and using outside parameters updated each year. Furthermore, at December 31, 2013 and to calculate the fair value as of this date, Management modified the years estimated to recover the tax credits from 3 to 4 years. At December 31, 2013, 2012 and 2011, the adjustment for US$.16,513 thousands, US$.1,339 thousands and US$.6,623 thousands (Bs. 104,037 thousands, Bs.5,759 thousands and Bs.28,477 thousands), respectively, is included in the statements of comprehensive income under the category of financial expenses.

(l) Law on Special Contributions over Extraordinary Prices of the International Hydrocarbons Market

In April 2008, the National Executive of the Venezuelan Bolivarian Republic, by means of a decree-law, established a special contribution over extraordinary prices of the international hydrocarbons market, amended in July 2008, which levies the sale of crude oil whenever the average price for the month in question of the Venezuelan oil production exceeds the price of US$.70/barrel. The amount of said contribution equals 50% of the difference resulting of the average price per month and the aforementioned cap of US$.70/barrel. In addition, this decree-law sets forth that whenever the average price per month exceeds the price of US$.100/barrel, the total amount of said special contribution will be equivalent to 60% of the above defined difference. This law was superseded by the Law Creating a Special Contribution on Extraordinary Prices and Exorbitant Prices in the International Hydrocarbons Market (see Note 23-e) published on April 18, 2011. During the period this law was in effect until it was superseded on April 19, 2011, Petrodelta, S.A. incurred in this tax for the year ended December 31, 2011 the amount of US$.38,244 thousands (Bs.164,449 thousands), included in the statements of comprehensive income under royalties.

m) Amendment to the Law Creating a Special Contribution on Extraordinary Prices and Exorbitant Prices in the International Hydrocarbons Market

On February 20, 2013, was published in the Official Gazette No. 40.114, an amendment to the Law Creating a Special Contribution on Extraordinary Prices and Exorbitant Prices in the International Hydrocarbons Market, published on April 18, 2011 in the Extraordinary Official Gazette No. 6.022, by means of decree-law No. 8.163 of same date. The amendments changes the intervals for calculating the special contribution and raise the base price to US$80 per barrel from US$70 per barrel (see Note 23-e). From the date this law came into effect, April 19, 2011, the Company incurred a special contribution from extraordinary prices and special contribution from exorbitant prices and recorded it in the statement of comprehensive income under royalties and other taxes for the year ended December 31, 2013, 2012 and 2011 the amounts of US$.234,453 thousands, US$.291,355 thousands and US$.199,388 thousands (Bs.1,477,054 thousands, Bs.1,252,827 thousands and Bs.857,368 thousands), respectively.

38

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

n) Other taxes

The Company is subject to special advantage taxes, which are determined based on: a) an interest as additional royalty of 3.33% on volumes of hydrocarbons extracted in the delimited areas assigned to Petrodelta S.A., and b) an amount equivalent to the difference, if any, between (i) 50% of the value of the hydrocarbons extracted in the delimited areas assigned to Petrodelta S.A. in each calendar year and (ii) the sum of payments made by the mixed companies to the Bolivarian Republic of Venezuela, for activities developed during the calendar year, for royalties on hydrocarbons and investments in endogenous development projects, equivalent to 1% of pre-tax income. Taxes for special advantages must be paid before April 20 of each year, pursuant to Exhibit F of the Agreement for Conversion into a Mixed Company. In relation to a) above, and the law that came into effect, published on April 18, 2011, creating a special contribution on extraordinary prices and exorbitant prices in the international hydrocarbons market and its amendments (see Note 23-e), which establishes a cap price of US$.70 per barrel until February 19, 2013 and a cap price of US$.80 per barrel from February 20, 2013, Petrodelta, S.A. incurred in this tax during 2013, 2012 and 2011 for US$.38,609 thousands, US$.31,181 thousands and US$.29,187 thousands (Bs.243,237 thousands, Bs.134,078 thousands and Bs.125,504 thousands), respectively, included in the statements of comprehensive income under royalties. In relation to b) above, at December 31, 2013, 2012 and 2011, this special advantage tax was lower than what the Company paid and accrued for royalties and special advantages tax.

Official Gazette No. 39.273 of the Bolivarian Republic of Venezuela, published on September 28, 2009, approved the modification of article regulating special advantages tax levied on mix companies to redistribute the use of funds by the additional royalty of 3.33% that mix companies have to pay on hydrocarbons volumes extracted from delimited areas. The modified article establish deliver 1.11% to municipalities where oil activities in the country take place and 2.22% for a special fund to be administered by the Executive branch to finance endogenous development projects. During the year ended December 31, 2013 the Company paid to the special fund administered by the Executive branch for financing endogenous development projects the amount of US$.28,664 thousands (Bs.180,586 thousands), of which corresponding to the month of January to September of 2013 are the amount of US$.17,858 thousands (Bs.112,504 thousands) and corresponding to the months of April to December of 2012 are the amount of US$.10,806 thousands (Bs.68,082 thousands).

(8) Property, Plant, and Equipment, Net

Property, plant, and equipment, net at December 31 comprises the following (in thousands):

39

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

U.S. Dollars-	Wells and production facilities			Construction in progress			Asset retirement costs			Furniture and equipment			Strategic inventories		Total
Cost:
Balances at December 31, 2010		340,162			78,755			21,925			10,615			5,096		456,553
Additions		—			132,995			—			4,961			—		137,956
Transfers and capitalization		100,495			(100,495	)		—			—			—		—
Strategic inventories		—			—			—			—			1,124		1,124
Asset retirement obligation		—			—			7,644			—					7,644
Balances at December 31, 2011		440,657			111,255			29,569			15,576			6,220		603,277
Additions		—			177,349			—			6,871			—		184,220
Transfers and capitalization		167,517			(167,517	)		—			—			—		—
Strategic inventories		—			—			—			—			6,742		6,742
Asset retirement obligation		—			—			23,229			—			—		23,229
Balances at December 31, 2012		608,174			121,087			52,798			22,447			12,962		817,468
Additions					265,380						3,856					269,236
Transfers and capitalization		145,902			(136,284	)					(9,618	)				—
Strategic inventories														7,518		7,518
Asset retirement obligation								(8,823	)							(8,823	)
Asset retirement		(2,844	)					(387	)							(3,231	)
Balances at December 31, 2013		751.232			250,183			43,588			16,685			20,480		1,082,168
Depletion, depreciation and amortization -
Balances at December 31, 2010		122,395			—			8,201			4,141			—		134,737
Depletion, depreciation, and amortization		51,753			—			4,940			1,682			—		58,375
Balances at December 31, 2011		174,148			—			13,141			5,823			—		193,112
Depletion, depreciation, and amortization		80,362			—			2,806			2,837			—		86,005
Balances at December 31, 2012		254,510			—			15,947			8,660			—		279,117
Depletion, depreciation, and amortization		77,945						5,674			3,584					87,203
Asset retirement		(1,464	)					(137	)							(1,601	)
Balances at December 31, 2013		330,991			—			21,484			12,244			—		364,719
Total net cost at December 31, 2013		420,241			250,183			22,104			4,441			20,480		717,449
Total net cost at December 31, 2012		353,664			121,087			36,851			13,787			12,962		538,351
Total net cost at December 31, 2011		266,509			111,255			16,428			9,753			6,220		410,165

40

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

Bolivars-	Wells and production facilities			Construction in progress			Asset retirement costs			Furniture and equipment		Strategic inventories		Total
Cost:
Balances at December 31, 2010		1,462,697			338,646			94,277			45,645		21,913		1,963,178
Additions		—			571,879			—			21,332		—		593,211
Transfers and capitalization		432,129			(432,129	)		—			—		—		—
Strategic inventories		—			—			—			—		4,833		4,833
Asset retirement obligation		—			—			32,869			—		—		32,869
Effect for variation in the presentation currency		617,889			70,760			42,746			16,052		26,045		773,492
Balances at December 31, 2011		1,894,826			478,396			127,146			66,977		26,746		2,594,091
Additions		—			762,602			—			29,545		—		792,147
Transfers and capitalization		720,323			(720,323	)		—			—		—		—
Strategic inventories		—			—			—			—		28,991		28,991
Asset retirement costs		—			—			99,886			—		—		99,886
Balances at December 31, 2012		2,615,149			520,675			227,032			96,522		55,737		3,515,115
Additions		—			1,671,894			—			24,293				1,696,187
Transfers and capitalization		919,183			(858,589	)		—							—
Strategic inventories		—			—			—					47,363		47,363
Asset retirement obligation		—			—			(55,585	)						(55,585	)
Asset retirement		(17,917	)					(2,438	)						(20,355	)
Effect for variation in the presentation currency		1,216,347			242,173			105,595			44,894		25,924		1,634,933
Balances at December 31, 2013		4,732,762			1,576,153			274,604			105,115		129,024		6,817,658
Depletion, depreciation and amortization -
Balances at December 31, 2010		526,299			—			35,263			17,807		—		579,369
Depletion, depreciation and amortization		222,538			—			21,242			7,233		—		251,013
Balances at December 31, 2011		748,837			—			56,505			25,040		—		830,382
Depletion, depreciation and amortization		345,555			—			12,067			12,199		—		369,821
Balances at December 31, 2012		1,094,392			—			68,572			37,239		—		1,200,203
Depletion, depreciation and amortization		491,054						35,746			22,579				549,378
Asset retirement		(9,223	)					(863	)						(10,086	)
Effect for variation in the presentation currency		509,021			—			31,984			17,319		—		558,234
Balances at December 31, 2013		2,085,244			—			135,349			77,136		—		2,297,729
Total net cost at December 31, 2013		2,647,518			1,576,153			139.255			27,979		129,024		4,519,929
Total net cost at December 31, 2012		1,520,757			520,675			158,460			59,283		55,737		2,314,912
Total net cost at December 31, 2011		1,145,989			478,396			70,641			41,937		26,746		1,763,709

During the years ended December 31, 2013, 2012, and 2011 the Company added furniture and equipment and construction in progress for approximately US$.269,236 thousands, US$.184,220 thousands and US$.137,956 thousands (Bs.1,696,187 thousands, Bs.792,147 thousands and Bs.593,211 thousands), respectively.

During the years ended December 31, 2013, 2012 and 2011, the Company assessed asset impairment, taking into account new market and business conditions, and determined that there was no evidence of impairment of production assets.

At December 31, 2013 the Company modified the discount rate used to calculate the present value of future obligations resulting in a reduction of US$.8,823 thousands (Bs.55,585 thousands) in the asset retirement cost. For the years ended December 31, 2012 and 2011 the rate applied resulted in an increase in retirement cost in the amount of US$.23,229 thousands and US$.7,644 thousands (Bs.99,886 thousands and Bs.32,869 thousands), respectively (see Note 14).

The balance of construction in progress mainly comprises investment projects for exploration and production activities related to drilling, maintenance, electrical systems, pipelines, well reconditioning and adaptation, expansion and infrastructure aimed at maintaining production capacity and adapting the infrastructure to production levels set out in the Corporation’s business plan. At December 31, 2013, 2012 and 2011, the balance of construction in progress for investments related to the aforementioned activities amounts to approximately US$.250,183 thousands, US$.121,087 thousands and US$.111,255 thousands (Bs.1,576,153 thousands, Bs.520,675 thousands and Bs.478,396 thousands), respectively. During the years ended December 31, 2013, 2012 and 2011 fixed assets capitalized amounted to US$.100,495 thousands, US$.167,517 thousands and US$.136,308 thousands (Bs.432,129 thousands, Bs.720,323 thousands and Bs.858,740 thousands), respectively.

41

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(9) Prepaid expenses and other assets

Prepaid expenses and other assets comprise the following (in thousands):

	December 31,
	2013		2012		2011		2013		2012		2011
	U.S. Dollars						Bolivars
Prepaid insurance		663		669		304		4,177		2,877		1,307
Prepaid services		192		450		177		1,210		1,935		761
Prepaid rent		14		42		42		88		181		180
		869		1,161		523		5,475		4,993		2,248

(10) Inventories

A summary of inventories is shown below (in thousands):

	December 31,
	2013			2012			2011			2013			2012			2011
	U.S. Dollars									Bolivars
Materials and supplies		125,712			90,640			43,072			791,986			389,752			185,209
Less:
Inventory obsolescence provision (See Note 3-i)		(1,236	)		(41	)		(58	)		(7,787	)		(176	)		(249	)
Materials and supplies classified as strategic inventory in other non-current assets (see Note 8)		(20,480	)		(12,962	)		(6,220	)		(129,024	)		(55,737	)		(26,746	)
		103,996			77,637			36,794			655,175			333,839			158,214

(11) Accounts Receivable

Accounts receivable comprise the following (in thousands):

	December 31,
	2013		2012		2011		2013		2012		2011
	U.S. Dollars						Bolivars
Related parties (see Note 21)		1,717,946		1,232,199		912,652		10,823,060		5,298,456		3,924,404
Current portion of recoverable tax credits (see Note 7—k)		—		14,860		8,619		—		63,901		37,064
Advances on windfall tax		70,194		64,694		—		442,222		278,185		—
Other		7,630		1,549		1,517		48,069		6,660		6,523
		1,795,770		1,313,302		922,788		11,313,351		5,647,202		3,967,991

42

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

During the years ended December 31, 2013, 2012 and 2011, the Company offsets accounts receivables and payables between PDVSA and its affiliates, including CVP with the Company in the amounts approximately of US$.442 million, US$.565 million and US$.374 million, respectively. These offsetting of accounts were approved by the Board of Directors of the Company. Exposure to credit risk related to accounts receivable are presented in Note 19.

As of December 31, 2013 accounts receivable from sales of crude from El Salto field and for which will be invoiced under the Boscán pricing formula once the amendment of the contract is approved and the contract is executed amounts to US$.756,695 thousands (Bs.4,767,180 thousands), whereas US$.403,973 thousands (Bs.2,545,032 thousands) corresponds to the year ended December 31, 2013, US$.301,950 thousands (Bs.1,902,286 thousands) corresponds to the year ended December 31, 2012 and US$.50,772 thousands (Bs.319,862 thousands) corresponds to the period of October 2011 to December 2011 (see Note 1).

Advances on windfall tax at December 31, 2013 and 2012 corresponds to payments made by PDVSA Petróleo, on behalf of the Company, to MPPPM for special contributions on extraordinary prices and exorbitant prices in the international hydrocarbons market for the last four months of 2013 and the fourth quarter ending December 31, 2012 in the amount of US$.70,194 thousands and US$.64,694 thousands (Bs. 442,222 thousands and Bs.278,185 thousands), respectively.

(12) Cash and Cash Equivalents

Cash and cash equivalent comprises the following (in thousands):

	December 31,
	2013		2012		2011		2013		2012		2011
	U.S. Dollars						Bolivars
Cash on hand		3		5		5		19		22		22
Cash at banks		5,957		3,330		2,337		37,529		14,314		10,049
		5,960		3,335		2,342		37,548		14,336		10,071

(13) Equity

a) Capital stock

At December 31, 2013, 2012 and 2011, the Company’s nominal capital stock is represented by 1,500,000 common shares, fully authorized and paid in, with a par value of US$.4.65 each (Bs.10 each) (see Note 13-f).

The Company’s capital stock is divided into two types of shares: Class “A” and Class “B” shares. Only the Venezuelan government or Venezuelan state-owned companies can own Class “A” shares. In October 2007, when the Company was incorporated, shareholders made an initial capital contribution of approximately Bs.1,000 thousands (US$.465 thousands).

43

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

On August 14, 2012, the Shareholders of the Company approved the transfer of 4% of capital stock CVP has in the Company to PDVSA Social, S.A. (PDVSA Social), a wholly owned subsidiary of Petróleos de Venezuela, S.A. (see Note 1)

Capital stock has been fully subscribed and paid in as follows:

Shareholders	Type of shares	Number of shares		Par value US$.		Par value Bs.		Share of equity
Corporación Venezolana del Petróleo, S,A, (CVP)	A		840,000		3,906,977		16,800,000		56	%
PDVSA Social, S.A.	A		60,000		279,070		1,200,000		4	%
HNR Finance, B,V, (HNR Finance)	B		600,000		2,790,698		12,000,000		40	%
			1,500,000		6,976,745		30,000,000		100	%

b) Legal Reserve

Venezuelan companies are required to set aside a legal reserve. According to Venezuelan Law, the legal reserve is not available for dividend distribution.

c) Deferred Tax Asset Equity Reserve

In June 2009, CVP issued instructions to all mixed companies regarding the accounting for deferred tax assets. The mixed companies have been instructed to set up a reserve within the equity section of the balance sheet for deferred tax assets. The setting up of the reserve had no effect on the Company financial position, results of operations or cash flows. However, the new reserve reduces the amount of reserves available to pay of dividends in the future. Changes in the deferred tax asset are recorded in appropriation to (transfer from) other reserves.

In August 2009, the Board of Directors of the Company approved the creation of the deferred tax asset equity. At December 31, 2013, 2012 and 2011, management has recorded as equity reserve and amount equal to the balance of the net deferred tax assets and liabilities at that date equivalent to US$.88,089 thousands, US$.70,426 thousands and US$.146,456 thousands (Bs.554,954 thousands, Bs.302,833 thousands and Bs.629,761 thousands), respectively (see Note 7-f), which has been approved by the Board of Directors of the Company (see Note 2-a).

d) Share premium

The share premium is in respect of contributions of fixed assets and inventories made by shareholders in conformity with the Agreement for Conversion into a Mixed Company, whose value exceeds the par value of common shares issued. At December 31, 2013, 2012 and 2011, the share premium amounts to approximately US$.212,451 thousands, equivalent to approximately Bs.913,540 thousands, included in equity.

Class “A” share premiums are in respect of fixed assets contributed by CVP. The value of this share premium amounts to approximately US$.191,206 thousands, equivalent to approximately Bs.822,186 thousands, pursuant to Exhibit H of the Agreement for Conversion into a Mixed Company.

44

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

Class “B” share premiums are in respect of fixed assets and inventories contributed by HNR Finance. The value of this share premium amounts to approximately US$.21,245 thousands, equivalent to approximately Bs.91,354 thousands, pursuant to Exhibit G of the Agreement for Conversion into a Mixed Company.

In conformity with the Company’s bylaws, in case of Company liquidation, all assets will be transferred only to the Class “A” shareholder.

e) Dividends

On November 12, 2010, in Extraordinary Shareholders meeting the shareholders of the Company resolved to distribute and pay dividends in the amount of US$.30,550 thousands (Bs.131,365 thousands). This dividend corresponds to the remaining portion of retained earnings at the end of December 31, 2009 and is recorded as dividends payable at December 31, 2013, 2012 and 2011 in the statements of financial position for the amount resolved.

On August 4, 2010, in Extraordinary Shareholders meeting the shareholders resolved to pay dividends based on retained earnings as of December 31, 2009 in the amount of US$.30,550 thousands (Bs.131,365 thousands). The dividend approved was paid on October 2010 to HNR Finance for its share in the Company in the amount of US$.12,220 thousands (Bs.52,546 thousands). At December 31, 2011 the portion of the dividend corresponding to CVP for US$.18,330 thousands (Bs.78,819 thousands) was paid by means of offsetting accounts receivable and payables between PDVSA and its Affiliates, including CVP, this transaction was approved by the Board on January 12, 2012 (see Note 21).

f) Effect for Variation of the Exchange Rate in the Presentation Currency

The statements of changes in equity, in bolivars, for the year ended December 31, 2013, include the following effect originated for the variation in the official exchange rate when translating the financial statements in US Dollars (Functional Currency) to Bolivars (Presentation Currency), in conformity with IAS 21 (see Note 3-a) (in thousands, net):

45

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

	Balances as of December 31, 2013
	U.S. Dollars			Bolivars Before translation adjustment			Bolivars After translation adjustment			Translation Adjustment
Capital stock		6,977			30,000			43.955			13,955
Share premium		212,451			913,540			1,388,440			424,900
Legal reserve and other reserves
Legal reserve		698			3,000			4,397			1,397
Deferred tax equity reserve		88,089			554,961			554,961			—
		88,787			557,961			559,358			1,397
Retained earnings:
Undistributable retained earnings at January 1, 2013		469,722			1,878,951			2,959,249			1,080,298
Transfer from other reserves in 2013		(17,663	)		(111,277	)		(111,277	)		—
Total comprehensive income for the year 2013		255,782			1,611,428			1,611,428			—
		707,841			3,379,102			4,459,400			1,080,298
Equity		1,016,056			4,880,603			6,401,153			—
Translation adjustment not allocated											1,520,550

In a Board of Director´s meeting dated March 10, 2011 the proposal was approved to submit for consideration to the Shareholders of the Company the distribution of the cumulative translation adjustment among the components of equity. Then, on March 16, 2011, in an extraordinary assembly the Shareholders of the Company approved the distribution of the translation adjustment as of December 31, 2010. The statements of changes in equity expressed in Bolivars (Presentation Currency) for the year ended December 31, 2011 was restructured to recognize retrospectively this decision as follows:

	Balances as of December 31, 2010—restructured
	U.S. Dollars		Bolivars before translation adjustment		translation adjustment		Bolivars after translation adjustment
Capital stock		6,977		15,000		15,000		30,000
Shares premium		212,451		456,770		456,770		913,540
Legal reserve		698		1,500		1,500		3,000
Other reserves		51,834		222,885		—		222,885
Retained earnings		70,729		421,460		440,310		861,770
Total equity		472,371		1,117,615		913,580		2,031,195

46

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(14) Provisions

Provisions at December 31 comprise the following (in thousands):

	December 31,
	2013			2012			2011			2013			2012			2011
	U.S. Dollars									Bolivars
Provision for asset retirement costs (see Note 14)		65,616			70,425			41,518			413,381			302,828			178,527
Provision for retirement benefits		22,644			18,799			11,556			142,657			80,835			49,691
Provision for benefits payable		2,075			3,878			—			13,073			16,676			—
Commitments and Contingencies (see Note 20)		1,313			1,563			1,799			8,273			6,719			7,736
		91,648			94,665			54,873			577,384			407,058			235,954
Less: Non-current portion of provisions		(90,149	)		(93,096	)		(53,068	)		(567,940	)		(400,314	)		(228,193	)
Current portion		1,499			1,569			1,805			9,444			6,744			7,761

At December 31, 2013, 2012 and 2011, the provision for retirement benefits for personnel assigned to the Company amounts to US$.22,644 thousands, US$.18,799 thousands and US$.11,556 thousands, (Bs.142,657 thousands, Bs.80,835 thousands and Bs.49,691 thousands), respectively. At December 31, 2013, 2012 and 2011, PDVSA sent a statement for the liability according to the report of an independent actuary firm. The Company has analyzed demographic and financial data, considers that it reasonably reflects the liability for such concept and adjusted the obligation at the date of the statements of financial position. This pension and retirement plan covers all PDVSA employees and mixed companies payroll. Pension cost is not tax deductible until future periods when the pension is settled in cash. The Company is not required to reimburse the pension costs to PDVSA until PDVSA pays them.

Below are the movements of provisions during the years ended December 31, 2013, 2012 and 2011, (in thousands):

U.S. Dollars-	Balance at December 31, 2012		Effect for devaluation			Increase		Decrease			Balance at December 31, 2013		Current portion		Non-current portion
Provision for asset retirement costs		70,425		—			—		(4,809	)		65,616		—		65,616
Provision for retirement benefits		18,799		(12,831	)		16,676		—			22,644		18		22,626
Provision for benefits payable		3,878		(2,647	)		844		—			2,075		168		1,907
Commitments and Contingencies (see Note 20)		1,563		(1,067	)		817		—			1,313		1,313		—
Total provisions		94,665		(16,545	)		18,337		(4,809	)		91,648		1,499		90,149

U.S. Dollars-	Balance at December 31, 2011		Increase		Decrease			Balance at December 31, 2012		Current portion		Non-current portion
Provision for asset retirement costs		41,518		28,907		—			70,425		—		70,425
Provision for retirement benefits		11,556		7,243		—			18,799		6		18,793
Provision for benefits payable		—		3,878		—			3,878		—		3,878
Commitments and Contingencies (see Note 20)		1,799		—		(236	)		1,563		1,563		—
Total provisions		54,873		40,028		(236	)		94,665		1,569		93,096

47

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

U.S. Dollars-	Balance at December 31, 2010		Increase		Decrease			Balance at December 31, 2011		Current portion		Non-current portion
Provision for asset retirement costs		29,798		11,720		—			41,518		—		41,518
Provision for retirement benefits		8,444		3,112		—			11,556		6		11,550
Commitments and Contingencies (see Note 20)		2,093		—		(294	)		1,799		1,799		—
Total provisions		40,335		14,832		(294	)		54,873		1,805		53,068

Bolivars-	Balance at December 31, 2012		Effect for devaluation		Increase		Decrease			Balance at December 31, 2013		Current portion		Non-Current portion
Provision for asset retirement costs		302,828		140,850		—		(30,297	)		413,381		—		413,381
Provision for retirement benefits		80,835		—		105,059		(43,237	)		142,657		113		142,544
Provision for benefits payable		16,676		—		5,317		(8,920	)		13,073		1,058		12,015
Commitments and Contingencies (see Note 20)		6,719		—		5,147		(3,593	)		8,273		8,273		—
Total provisions		407,058		140,850		115,523		(86,047	)		577,384		9,444		567,940

Bolivars-	Balance at December 31, 2011		Increase		Decrease			Balance at December 31, 2012		Current portion		Non-current portion
Provision for asset retirement costs (see Note 9)		178,527		124,301		—			302,828		—		302,828
Provision for retirement benefits		49,691		31,144		—			80,835		25		80,810
Provision for benefits payable		—		16,676		—			16,676		—		16,676
Commitments and Contingencies (see Note 20)		7,736				(1,017	)		6,719		6,719		—
Total provisions		235,954		172,121		(1,017	)		407,058		6,744		400,314

Bolivars-	Balance at December 31, 2010		Increase		Decrease			Balance at December 31, 2011		Current portion		Non-current portion
Provision for asset retirement costs		128,131		50,396		—			178,527		—		178,527
Provision for retirement benefits		36,309		13,382		—			49,691		25		49,666
Commitments and Contingencies (see Note 20)		9,000				(1,264	)		7,736		7,736
Total provisions		173,440		63,778		(1,264	)		235,954		7,761		228,193

48

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

The movement of the provision for asset retirement costs at December 31 is shown below (in thousands):

	U.S. Dollars			Bolivars
Balance at December 31, 2010		29,798			128,131
Change on estimation		7,644			32,869
Financial cost		4,076			17,527
Balance at December 31, 2011		41,518			178,527
Change on estimation		23,229			99,886
Financial cost		5,678			24,415
Balance at December 31, 2012		70,425			302,828
Change on estimation		(9,310	)		(58,652	)
Financial cost		5,046			31,790
Dismantlement		(545	)		(3,434	)
Effect for variation in the presentation currency		—			140,849
Balance at December 31, 2013		65,616			413,381

During 2013, Company management reviewed, based on new information, estimates on assumptions used for calculating the provision for asset retirement costs and changed the discount rate to 12.81% from 9.02% at the end of December 2012. Furthermore, the Company modified the inflation rate to 2.82% at the end of December 2013 from 2.41% at the beginning of 2013.

At December 31, 2013, this change in the estimate of asset retirement costs due to modification of the discount and inflation rates decreased the asset retirement cost as well as the asset retirement provision by US$.9,310 thousands (Bs.58,652 thousands). For the years ended December 31, 2012 and 2011 the provision increased by US$.23,229 thousands and US$.7,644 thousands (Bs.99,886 thousands and Bs.32,869 thousands), respectively. The Company´s business plan as of December 31, 2013, contemplates the realization of hydrocarbons drilling and production activities until the year 2027; therefore, the accrual for asset retirement costs was calculated based on the disbursements for this concept during this period.

(15) Accruals and Other Liabilities

Accruals and other liabilities at December 31 comprise the following (in thousands):

	December 31,
	2013		2012		2011		2013		2012		2011
	U.S. Dollars						Bolivars
Royalties and other taxes		125,373		130,709		106,805		789,850		562,049		459,262
Endogenous and social development		10,240		11,431		8,005		64,512		49,153		34,422
Antidrug National Fund		14,066		13,828		10,746		88,616		59,461		46,208
Science and Technology (LOCTI)		9,623		8,292		3,054		60,625		35,656		13,132
Sport Organic Law		9,108		4,192		1,110		57,380		18,026		4,773
Others:
Accrued payables with PDVSA (see Note 21)		209,402		213,173		67,570		1,319,233		916,644		290,551
Accrued payables to suppliers		102,668		119,209		58,888		646,808		512,599		253,218
Income taxes withheld		2,001		1,185		1,509		12,606		5,096		6,489
Other accruals		11,431		8,529		5,284		72,016		36,679		22,721
		493,912		510,548		262,971		3,111,646		2,195,363		1,130,776

49

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

Additionally, at December 31, 2013, 2012 and 2011, accrued payables with PDVSA in respect to drilling services and infrastructure amount to US$.183,359 thousands, US$.143,174 thousands and US$.63,879 thousands (Bs.1,155,164 thousands, Bs.615,651 thousands and Bs.274,680 thousands), respectively.

(16) Accounts Payable

Accounts payable comprise the following (in thousands):

	December 31,
	2013		2012		2011		2013		2012		2011
	U.S. Dollars						Bolivars
Trade payables		135,272		94,747		68,815		852,214		407,412		295,905
Related parties (see Note 21)		776,875		450,184		271,938		4,894,312		1,935,791		1,169,336
Total		912,147		544,931		340,753		5,746,526		2,343,203		1,465,241

Foreign currency and liquidity risk exposure in respect of accounts payable to suppliers is shown in Note 19.

(17) Operational Expenses

Below is a summary of operational expenses incurred by the Company (in thousands):

	Years ended December 31,
	2013		2012		2011		2013		2012		2011
	U.S. Dollars						Bolivars
Crude and gas operations		131,105		97,562		63,570		825,962		419,517		273,351
Crude transportation		35,635		29,610		27,200		224,501		127,323		116,960
Others		12.960		11,433		14,980		81,647		49,162		64,414
		179,700		138,605		105,750		1,132,110		596,002		454,725

50

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(18) Financial Income and Expenses

Financial income and expenses comprised the following (in thousands):

	Years ended December 31,
	2013		2012		2011		2013		2012		2011
	U.S. Dollars						Bolivars
Financial income:
Gain on variation of exchange rate		147,224		—		—		927,511		—		—
Other financial income		—		—		7		—		—		30
		147,224		—		7		927,511		—		30
Financial expenses
Adjustment to net realizable value on financial assets (see Note 7-k)		16,682		1,339		6,623		105,097		5,758		28,477
Financial cost on provision for asset retirement costs (see Note 14)		5,046		5,678		4,076		31,790		24,415		17,527
Other financial expenses		6		6		3		37		26		13
		21,734		7,023		10,702		136,924		30,199		46,017

Gain on variation of exchange rate

On February 8, 2013, the Exchange Agreement No. 14 was published in the Official Gazette No. 40,108, which establishes the new official rate for the purchase and sale of the US Dollar and effective from February 9, 2013. The new official rate increased from Bs4.30 to Bs6.30 per US Dollar. Therefore, all transactions and balances in Bolivars were converted to U.S. Dollars as per the new exchange rate, resulting in a net gain for the variation effect in the exchange rate due to the fact of maintaining a net liability monetary position in bolivars at the date when the variation of the exchange rate went into effect (see Note 4 and Note 24-c).

(19) Financial Instruments

Credit Risk

Exposure to Credit Risk

The book value of financial assets represents the highest level of credit risk exposure. A breakdown is shown below (in thousands):

	December 31,
	2013		2012		2011		2013		2012		2011
	U.S. Dollars						Bolivars
Accounts receivable (see Note 11)		1,717,946		1,232,199		912,652		10,823,060		5,298,456		3,924,404
Recoverable tax credits (see Note 7-k)		46,878		44,581		25,858		295,331		191,702		111,193
Accounts receivable other (see Note 11)		70,194		66,243		1,517		442,222		284,845		6,523
Cash and cash equivalents (see Note 12)		5,960		3,335		2,342		37,548		14,336		10,071
		1,840,978		1,346,358		942,369		11,598,161		5,789,339		4,052,191

51

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

Aging of the account receivables are shown below (in thousands):

	December 31,
	2013		2012		2011		2013		2012		2011
	U.S. Dollars						Bolivars
Under 30 days		1,034,241		709,815		469,607		6,515,718		3,052,205		2,019,311
Between 31 and 180 days		124,298		106,050		131,447		783,077		456,015		565,222
Between 180 days and one year		482,012		410,908		311,598		3,036,676		1,766,904		1,339,871
More than one year		77,395		5,426		—		487,589		23,332		—
		1,717,946		1,232,199		912,652		10,823,060		5,298,456		3,924,404

In the accounts receivable under 30 days are included unbilled receivables of US$.756.695 thousands, US$.352.721 thousands and US$.50.772 thousands (Bs.4.767.180 thousands, Bs.1.516.704 thousands, and Bs.218.319 thousands) as of December 31, 2013, 2012 and 2011 respectively, which will be billed at the time of signature and final approval of the amendment to the Petroleum Purchase and Sale Agreement due to changes in the price formula (see Note 1, 11, and 21).

Liquidity risk

Maturity of financial liabilities, Short-term payable, including estimated interest payments and excluding the impact of offset agreements, is shown below (in thousands):

	Book value						Contractual cash flows						6 months or less
	Non-derivative financial liabilities at December 31,
	2013		2012		2011		2013		2012		2011		2013		2012		2011
U.S. Dollars
Accounts payable to suppliers (see Note 16)		135,272		94,747		68,815		135,272		94,747		68,815		135,272		94,747		68,815
Bolivars
Accounts payable to suppliers (see Note 16)		852,214		407,412		295,905		852,214		407,412		295,905		852,214		407,412		295,905

Foreign Currency Risk

Petrodelta, S.A. has the following monetary assets and liabilities denominated in currencies other than the U.S. Dollar, which were converted into U.S. Dollars at the exchange rate in effect at the statements of financial position (in thousands):

	December 31,
	2013			2012			2011
Monetary assets:
Bolivars		1,011,474			277,152			172,801
		1,011,474			277,152			172,801
Monetary liabilities:
Bolivars		6,683,445			2,646,171			2,534,998
		6,683,445			2,646,171			2,534,998
Net monetary liability position		(5,671,971	)		(2.369,019	)		(2,362,197	)

52

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

The year-end exchange rate, the average exchange rate for the year and the interannual increases in the National Consumer Price Index (NCPI), as published by BCV, were as follows:

	December 31,
	2013		2012		2011
Exchange rate at year end (Bs./US$..1)		6.30		4.30		4.30
Average exchange rate for the year (Bs./US$..1)		6.08		4.30		4.30
Interannual increase in the NCPI (%)		56.19		20.10		27.57

Fair Value of Financial Instruments

The following estimated amounts do not necessarily reflect the amounts at which the instruments could be exchanged in the current market. The use of different market assumptions and valuation methods can significantly affect the estimated fair values. The bases for determining the fair value are disclosed in Note 5 (in thousands):

	December 31,
	2013				2012				2011
U.S. Dollars-	Book Value		Fair Value		Book Value		Fair Value		Book Value		Fair Value
Assets:
Accounts receivable (see Note 11)		1,717,946		1,717,946		1,232,199		1,232,199		912,652		912,652
Recoverable tax credits		46,878		46,878		44,581		44,581		25,858		25,858
Advances on windfall tax (see Note 11)		70,194		70,194		64,694		64,694		—		—
Accounts receivable other (see Note 11)		7,630		7,630		1,549		1,549		1,517		1,517
Cash and cash equivalents (see Note 12)		5,960		5,960		3,335		3,335		2,342		2,342
Liabilities:
Accounts payable to suppliers (see Note 16)		135,272		135,272		94,747		94,747		68,815		68,815
Other liabilities (included in provisions, accruals and other payables) (see Notes 14 and 15)		585,560		585,560		605,213		605,213		317,844		317,844
Accounts payables to shareholders and related companies (See Note 16)		807,425		807,425		450,184		450,184		271,938		271,938

53

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

	December 31,
	2013				2012				2011
Bolivars-	Book Value		Fair Value		Book Value		Fair Value		Book Value		Fair Value
Assets:
Accounts receivable (see Note 11)		10,823,060		10,823,060		5,298,456		5,298,456		3,924,404		3,924,404
Recoverable tax credits		295,331		295,331		191,702		191,702		111,193		111,193
Advances on windfall tax (see Note 11)		442,222		442,222		278,185		278,185		—		—
Accounts receivable other (see Note 11)		48,069		48,069		6,660		6,660		6,523		6,523
Cash and cash equivalents (see Note 12)		37,548		37,548		14,336		14,336		10,071		10,071
Liabilities:
Accounts payable to suppliers (see Note 16)		852,214		852,214		407,412		407,412		295,905		295,905
Other liabilities (included in provisions, accruals and other payables) (see Notes 14 and 15)		3,689,029		3,689,029		2,602,421		2,602,421		1,366,730		1,366,730
Accounts payables to shareholders and related companies (see Note 16)		5,086,777		5,086,777		1,935,791		1,935,791		1,169,333		1,169,333

(20) Commitments and Contingencies

At December 31, 2013, 2012 and 2011 the Company has recorded a provision for 6 labor related claims in the amount of US$.11 thousands, US$.16 thousands and US$.16 thousands (Bs.69 thousands, Bs.69 thousands and Bs.69 thousands), respectively. Should the outcome of existing lawsuits and claims be unfavorable to the Company, it could have a material adverse effect on its results of operations. Although it is not possible to predict the outcome, Company management, based in part on the opinion of its legal advisors, does not believe it is likely that losses related to the aforementioned legal procedures will exceed recognized estimated amounts or generate significant amounts that could affect the Company’s financial position or results of operations.

Compliance with Environmental Regulations

The subsidiaries of CVP are subject to different environmental laws and regulations which may require significant expenditures to modify facilities and prevent or remedy the environmental effects from waste disposal and spills of pollutants.

Petrodelta, S.A. and its parent company CVP are taking steps to prevent environmental risks, protect employee health and preserve the integrity of their facilities.

Management estimated potential liabilities as of December 31, 2013, 2012 and 2011 amounting to US$.1,313 thousands, US$.1,563 thousands and US$.1,799 thousands (Bs.8,273 thousands, Bs.6,719 thousands and Bs.7,736 thousands), respectively, and were included in the Statements of Comprehensive Income for these years.

Agreements with the Organization of Petroleum Exporting Countries (OPEC)

The Bolivarian Republic of Venezuela is a member of OPEC, an organization mainly dedicated to establishing agreements to maintain stable crude oil prices by setting production quotas. To date, the reduction in crude oil production resulting from changes in the production quotas set by OPEC and price fluctuations has not significantly affected the Company’s results of operations, cash flows or financial results.

54

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(21) Related Party Transactions

Petrodelta, S.A. considers its shareholders and related subsidiaries and affiliates, Company directors and executives, as well as other governmental institutions, as related parties.

A summary of transactions and balances with related parties is shown below (in thousands):

	December 31,
	2013		2012		2011		2013		2012		2011
	U.S. Dollars						Bolivars
Activities for the year:
Crude oil and natural gas sales		1,275,601		1,160,653		1,048,728		8,036,287		4,990,808		4,509,530
Operational expenses		100,310		72,480		47,318		631,953		311,664		203,467
Sales, general, administrative and selling expenses		7,145		7,623		4,322		45,014		32,779		18,585
Production royalties for oil and gas		347,823		280,909		263,422		2,191,285		1,207,909		1,132,715
Reimbursement of expenses		189,567		135,465		175,166		1,194,272		582,500		753,214
Dividends paid to Shareholders		—		—		18,330		—		—		78,819
Balances at the end of the year:
Accounts receivable (see Note 11)		1,717,946		1,232,199		912,652		10,823,060		5,298,456		3,924,404
Accounts payable to Shareholder B (see Note 16)		2,907		2,722		1,969		18,314		11,705		8,467
Dividends payable to Shareholders A and B		30,550		30,550		30,550		192,465		131,365		131,365
Accounts payable to PDVSA		751,029		439,223		258,222		4,731,483		1,845,659		1,110,357
Other joint ventures		22,942		18,239		11,747		144,535		78,428		50,512
Accrued payables with PDVSA		209,402		213,173		67,570		1,319,233		916,644		290,551

As of April 2006, due to the migration of operating agreements to mixed companies (see note 1), PDVSA Petróleo signed purchase and sale agreements with these companies, which set out that mixed companies will notify PDVSA Petróleo of the estimated volume of hydrocarbons expected to be delivered the following month. PDVSA Petróleo must pay the mixed companies for delivered volumes, net of volumes for royalties in kind and paid to the Venezuelan government.

In conformity with the terms and conditions of the agreements, CVP mixed companies agree to sell and deliver to PDVSA Petróleo, and the latter agrees to purchase and receive from these mixed companies, crude oil and natural gas produced in the delimited areas that are not used for primary activities or for payment of royalties in kind to the Venezuelan government.

55

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

Crude oil delivered from the Petrodelta fields to PDVSA is priced with reference to Merey 16 published prices, weighted for different markets and adjusted for variations in gravity and sulphur content, commercialization costs and distortions that may occur given the reference price and prevailing market conditions, except for the volumes of crude produced from El Salto field since October 2011 which the Company has agreed to amend the purchase sale agreement with PDVSA Petróleo so it can invoice PDVSA using as Boscán as a crude reference for El Salto field production (see Notes 1 and 11). Market prices for both crude oil of the type produced (Merey 16 and Boscán) in the fields operated by Petrodelta averaged approximately US$.91.22, US$.95.90 and US$.98.52 per barrel for the year ended December 31, 2013, 2012 and 2011, respectively.

During the years ended December 31, 2013, 2012 and 2011, the Company recorded gross revenues unbilled, and royalty paid in kind, for the sale of crude oil in the amount of US$.566,738 thousands, US$.404.619 thousands and US$.67,092 thousands (Bs.3,570,453 thousands, Bs.1.739.862 thousands and Bs.288.496 thousands), respectively, corresponding to Boscan crude production which is not provided for billing in the Purchase-Sale of Oil signed between the Company and PDVSA Petroleo, S.A. As of December 31, 2013, 2012 and 2011, the Company has accounts receivable of US$.756,695 thousands, US$.352,721 thousands and US.$.50,772 thousands (Bs.4,767,180 thousands, Bs.1,516,704 thousands and Bs.218,319 thousands), respectively, for the delivery of such crude.

During the years ended December 31, 2013, 2012 and 2011, the Company sold crude oil and natural gas to PDVSA Petróleo SA for US$.1,275,601 thousands, US$.1,160,653 thousands and US$.1,048,728 thousands (Bs.8,036,287 thousands, Bs.4,990,808 thousands and Bs.4,509,530 thousands), respectively, included in the statements of comprehensive income under Income.

At December 31, 2013, 2012 and 2011, the statement of financial position includes US$.1,717,946 thousands, US$.1,232,199 thousands and US$.912,652 thousands (Bs.10,823,060 thousands, Bs.5,298,456 thousands and Bs.3,924,404 thousands) of accounts receivable for the crude and gas sales to PDVSA.

During 2013, 2012 and 2011, PDVSA Petróleo charged Petrodelta, S.A. US$.777 million, US$.888 million and US$.615 million (Bs.4,893 million, Bs.3,816 million and Bs.2,642 million), respectively, for labor and other costs, taxes, royalties, cash advances, dividends, and operating costs.

The Company´s results of operations were impacted by PDVSA Petróleo changing its policy with respect to invoicing in disbursements made in Bolivars on behalf of the Company to require that such invoices be denominated in US dollars rather than in Bolivars. This change was recognized in the fourth quarter ending December 31, 2013 with retroactive application to transactions occurring in 2011 and 2012. As a result of this change, the Company recorded a US$14.2 million foreign currency loss in the three month ended December 31, 2013 (see Note 24-c).

Certain Company directors hold key positions in other related entities; some of their attributions include influencing the operational and financial policies of these entities.

56

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

For the years ended December 31, 2013, 2012 and 2011, transactions with related parties do not necessarily reflect the results that would have been obtained had these transactions been held with third parties.

On August 30, 2013, the Company following instructions from its shareholder CVP proceeded to offset accounts receivables and payables between PDVSA and its affiliates, including CVP for royalties, contributions, taxes, advances and operational expenses outstanding as of August 31, 2013 resulting in a netting of US$.115 million (Bs.722 million) against the accounts receivable with PDVSA and its affiliates, including CVP, for the crude and gas sold and delivered outstanding as of August 31, 2013 at the prevailing exchange rate applicable at such date. At present this event is pending for the approval by the Board of Directors of the Company.

On February 1, 2013, the Company following instructions from its shareholder CVP proceeded to offset accounts receivables and payables between PDVSA and its affiliates, including CVP for royalties, contributions, taxes, advances and operational expenses outstanding as of January 31, 2013 resulting in a netting of US$.327 million (Bs.2,061 million) against the accounts receivable with PDVSA and its affiliates, including CVP, for the crude and gas sold and delivered outstanding as of January 31, 2013 at the prevailing exchange rate applicable at such date. On October 8, 2013 the Board of Directors of the Company approved the offset of accounts receivables and payables executed on February 1, 2013.

On December 28, 2012, the Company following instructions from its shareholder CVP proceeded to offset accounts receivables and payables between PDVSA and its affiliates, including CVP for royalties, contributions, taxes, advances and operational expenses outstanding as of November 30, 2012 resulting in a netting of US$.267 million (Bs.1,149 million) at the prevailing exchange rate applicable at such date against the accounts receivable with PDVSA and its affiliates, including CVP, for the crude and gas sold and delivered outstanding as of November 30, 2012 at the prevailing exchange rate applicable at such date. On January 31, 2013 the Board of Directors of the Company approved the offset of accounts receivables and payables executed on December 28, 2012.

On June 20, 2012, the Company following instructions from its shareholder CVP proceeded to offset accounts receivables and payables between PDVSA and its affiliates, including CVP for royalties, contributions, taxes, advances and operational expenses outstanding as of May 31, 2012 resulting in a netting of US$.298 million (Bs.1,282 million) at the prevailing exchange rate applicable at such date against the accounts receivable with PDVSA and its affiliates, including CVP, for the crude and gas sold and delivered outstanding as of May 31, 2012 at the prevailing exchange rate applicable at such date. On January 31, 2013 the Board of Directors of the Company approved the offset of accounts receivables and payables executed on June 20, 2012.

On January 12, 2012, the Company following instructions from its shareholder CVP proceeded to offset accounts receivables and payables between PDVSA and its affiliates, including CVP for royalties, contributions, taxes, advances, operational expenses and dividends payable to CVP approved by the shareholders of the Company on August 4, 2010 (see Note 13) against the Company accounts receivable with PDVSA and its affiliates, including CVP, for the crude and gas sold, outstanding as of December 31, 2011, resulting in a netting of US$.205 million (Bs.882 million) at the prevailing exchange rate applicable at such date. On February 23, 2012 the Board of Directors of the Company approved the offset of accounts receivables and payables executed on January 12, 2012.

57

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

On October 28, 2011, the Company following instructions from its shareholder CVP proceeded to offset accounts receivables and payables between PDVSA and its affiliates, including CVP for royalties, contributions, taxes, advances and operational expenses against the Company accounts receivable with PDVSA and its affiliates, including CVP, for the crude and gas sold, outstanding as of September 30, 2011, resulting in a netting of US$.169 million (Bs.727 million) at the prevailing exchange rate applicable at such date.

During February 2011, the Company following instructions from its shareholder CVP proceeded to offset accounts receivables and payables between PDVSA and its affiliates, including CVP with the Company outstanding as of December 31, 2009 at the exchange rate prevailing as of this date, resulting in a netting of US$.46 million (Bs.101 million). Additionally, in the same month and year, CVP sent instructions again to the Company to proceed and offset accounts receivables and payables between PDVSA and its affiliates, including CVP with the Company outstanding as of December 31, 2010, resulting in a netting of US$.195 million (Bs.838 million). Both nettings have been recorded in the month of December of 2010, and are included in the statements of financial position as of December 31, 2010.

(22) Collective Labor Agreement

The Collective Labor Agreement expired on October 1, 2013, and on February 11, 2014 the new Collective Labor Agreement was signed between Petróleos de Venezuela, S.A. officials and Venezuela Unitary Federation of Workers of the oil, gas and derivatives (FUTPV) representing employees for the oil industry for the period 2013 to 2015 (see Note 24-b)

On July 20, 2012 the Collective Labor Agreement was signed, valid for the period from October 1, 2011 thru October 1, 2013, among the employees of the oil industry represented by the Venezuelan Unitary Federation of workers of the oil, gas, its similar and derivatives (FUTPV) and the Ministry of Popular Power for Energy and Mining (MPPPM) and PDVSA. The Collective Labor Agreement establishes a salary raise and payroll and retirement benefits which has a significant impact on the Company’s payroll cost. The most significant impacts had an economic and social benefit on workers and are summarized as follows:

i. Focus the contract to a higher social justice through increases in the quality of life of workers by supporting the acquisition of school supplies for their children, provide benefits for newborns, marriage, attention to handicapped people and financing tourism packages for workers and their families under the Collective Labor Agreement.

ii. A salary raise of Bs.40 daily from October 1, 2011. Payment of this increase was done Bs.30 at end of July 2012 and Bs.10 from January 1, 2013.

iii. An increase in the monthly amount for electronic card for foods from Bs.1,700 to Bs. 2,700.

iv. Provide 65 days of vacation bonus to contractual payroll and between 15 and 30 days of post-vacation bonus depending on the type of payroll. Also it was agreed to increase to Bs.200,000 the amount to finance housing acquisition.

58

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

Before, on January 20, 2010 the Collective Labor Agreement was signed, valid for the period from October 1, 2009 thru October 1, 2011, by workers leaders of the industry represented by the FUTPV and the Ministry of the MPPPM and PDVSA President. The Collective Labor Agreement establishes a salary raise and payroll and retirement benefits which has a significant impact on the Company’s payroll cost. The most significant impacts are:

i. A salary raise of Bs.35 daily which represents an increase of 80% of current salary. The increase shall be pay in two portions, the first of Bs.25 at the signing of the contract and the second of Bs.10 from January 1st, 2011.

ii. An increase in the monthly amount for electronic card for foods from Bs.1,300 to Bs. 1,700.

iii. An increase in the retirement benefit from Bs. 1,000 to Bs. 1,600.

iv. The increase will be retroactive from October 1, 2009 and not from January 21, 2009, being the date on which the prior contract expired, in compensation it was agreed a one-time bonus of Bs. 8.000 which has no effect in the severance benefits of employees.

(23) Laws, Resolutions and Legal Contributions

a) Exchange Agreement No. 24

On December 30, 2013, Foreign Exchange Agreement No. 24 was published in the Official Gazette No. 40,324. This Exchange Agreement between the Ministry of the People´s Power for Finance Matters and the Central Bank of Venezuela (BCV) established the buying exchange rate applicable to Petróleos de Venezuela, S.A. and its subsidiaries including mix companies created in accordance within the provision of the Organic Hydrocarbons Law, for the sale of foreign currency originated from activities different from export and or sale of hydrocarbons operations, will be equal to the exchange rate resulting from the latest foreign exchange allocation through Supplementary on Foreign Exchange Administration System (SICAD), which will be published in the website of the BCV, reduced by 0.25%. The same buying rate will apply to the sale of foreign currency transactions generated by services companies that are part of the so-called Petroleum Industrial National Conglomerate, and those who derived from mineral exports. The selling exchange rate applicable to the companies mentioned shall equal the rate resulting from the latest foreign exchange allocation through SICAD. In order to implement such sale of US Dollars, entities referenced above must first deliver the US Dollars to PDVSA Petróleo, who will then sell the US Dollars on their behalf. The Company is in the process of analysis of this Exchange Agreement to determine whether there is an effect in its financial statements.

59

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

b) Enabling Law

On November 20, 2013, the National Assembly published in the Extraordinary Official Gazette No. 6.112 the Law Authorizing the President of the Bolivarian Republic of Venezuela to issue Decree-Laws in a range of areas for a term of 12 months after publication thereof. Under this law, the authorization encompasses areas among other things fighting corruption and defending the country´s economy.

c) Partial Rules on Labor and Workers Organic Law

On May 16, 2013, in the Official Gazette No. 40.157 was published decree No. 44 issued by the National Executive related to partial rules of the labor and workers organic law related to working time. Companies private and public are obliged to post in visible areas working day and night time as well resting days. Also, establishing fixed and partial shifts as well permits on extraordinary working time.

d) Exchange Agreement No. 21

On March 22, 2013 Exchange Agreement No. 21 was published in the Venezuelan Official Gazette No. 40,134, establishing that the Superior Body for Optimization of the Exchange Rate System shall rule all the terms and conditions of the special bids for foreign currency, which shall be aimed at covering the import needs of the real local economy. The bids will be coordinated by the Superior Body for Optimization of the Exchange Rate System through a new system created for that purpose, called the Supplementary System for Foreign Currency Administration (SICAD), which is to be managed by BCV in accordance with the invitations to bid issued for such purposes.

e) Law Creating a Special Contribution on Extraordinary Prices and Exorbitant Prices in the International Hydrocarbons Market

On April 18, 2011, the Venezuelan government published in the Extraordinary Official Gazette No. 6.022, by means of decree-law No. 8.163 of same date, the Law Creating a Special Contribution on Extraordinary Prices and Exorbitant Prices in the International Hydrocarbons Market. This law supersedes the Law for Special Contributions on Extraordinary International Hydrocarbon Market Prices (see Note 7-l), and modifies calculation and payment of royalty, extraction tax and export registry tax as per LOH as well as special contribution for extraordinary prices and creates a special contribution for exorbitant prices from the date published. The law defines the contribution on Extraordinary Prices for 20 percent to be applied to the difference between the average monthly price up to US$.70 or less per barrel, on international markets for the Venezuelan liquid basket of hydrocarbons and the price fixed by the Venezuela Annual Budget Law for the relevant fiscal year. The law also defines the contribution on Exorbitant Prices for (1) 80 percent when the average price mentioned before exceeds US$.70 per barrel but is less than US$.90 per barrel; (2) 90 percent when the average price mentioned before exceeds US$.90 per barrel but is less than US$.100 per barrel; and (3) 95 percent when the average price mentioned before exceeds US$.100 per barrel. The law also established the maximum price to be used for calculating royalty paid in cash on production at US$.70 per barrel.

Then, on February 27, 2012, Official Gazette No. 39,871 was published the decree No. 8.807 modifying the articles 2 and 10 of the Law Creating a Special Contribution on Extraordinary Prices and Exorbitant Prices in the International Hydrocarbons Market. The partial reform indicates that the use of resources derived from this law be used in financing the Great

60

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

Missions created by the National Executive, and projects of infrastructure, roads, health, education, among others. The development of the national production sector, among others areas. The partial reform also stipulates treasury aspects on how the contributions is to handle between PDVSA, the National Development Fund (FONDEN).

On February 20, 2013 in the Official Gazette No. 40,114, the reform to the law that creates a special contribution on extraordinary prices and exorbitant prices in the international hydrocarbons market published in the Extraordinary Official Gazette No. 6,022 by means of decree No. 8,163 from the Executive branch on April 18, 2011 was published. The most significant aspects are: a) guarantee financing of social missions created by the government as well as projects related to infrastructure, roads, health, education, communication, agriculture, food and in general for the development of the national productive sector, b) modify the parameter that defines what constitutes contributions from extraordinary prices (under US$.80 per barrel) and what constitutes contribution from exorbitant prices (from US$.80 per barrel and up), c) establish the new intervals to apply the percentage to calculate such contributions as per the following scheme: 1) 80% of the difference when exorbitant prices are higher than US$.80 per barrel but lower than US$.100 per barrel, 2), 90% of the difference when exorbitant prices are equal or higher than US$100 per barrel but lower than US$.110 per barrel, and 3) 95% when exorbitant prices are higher than $110 per barrel; d) modify the maximum price to calculate and pay royalty at US$.80 per barrel, e) supersede decree No. 8,807 that modified this law and published in the Official gazette No. 39.871 on February 27, 2012; and f) eliminates dispositions on the law from the Venezuela Central Bank that regulates funding from PDVSA Petróleo to the National Development Fund (FONDEN) and any other provision of exceeding that collides with the present Law.

The price per barrel established in the Venezuela Annual Budget Law for the years ended December 31, 2013, 2012, and 2011 was US$.55, US$.50 and US$.40, respectively.

f) Exchange Agreement No.14

On February 8, 2013, the Exchange Agreement No. 14 was published in the Official Gazette No. 40,108, which establishes the new official rate for the purchase and sale of the US Dollar at Bs.6.2842 and Bs.6.30, respectively. Likewise, it was published, a higher rank agency to optimize the exchange rate system in order to design, plan, and execute monetary strategies by the government, to reach higher efficiency and transparency providing foreign currency to the country economic sector.

g) Tax Unit Adjustment

On February 6, 2013, providence No. SNAT/2013/0009 from the National Integrated Service on Tributes and Customs Administration (SENIAT) was published in Official Gazette No. 40,106 in which the current tax unit value was adjusted from Bs.90 to Bs.107.

61

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

h) Special Law on Severance National Fund

On June 15, 2012 the National Executive published by means of decree-law No. 9,053 the Special Law on Severance Benefits National Fund in order to create the program National Fund for Severance Benefits which establishes the conditions to receive and manage deposits corresponding to the severance benefit guarantees of workers into government financial institutions.

i) Labor Organic Law and Workers

On April 30, 2012, the National Executive promoted by means of decree-law No. 8.938 the Labor Organic Law and Workers. On May 7, 2012 the National Assembly published on the Official Gazette No. 6,076 this organic law. The most significant aspects of this law are:

(1) Obligation by employers to calculate severance benefits retroactively by a) paying employees the equivalent of 15 days of salary every quarter with the most recent salary, this right is acquired at the beginning of each quarter, b) after the first year of service, the employer will pay employees 2 days of salary for every year worked, cumulative until a maximum of 30 days is reached, c) when by any reason the working relation ends, severance benefits will be calculated for 30 days for every year worked or fraction over 6 months and calculated with the most recent salary earned. Workers will receive as severance benefits, the higher amount between a) and b) or c) as described above. Quarterly or annual payments shall be deposited in the National Fund for Severance Benefits under each workers name, or at a trust fund in financial institutions or at the employer´s accounting records as long as workers authorize it in writing.

(2) Increase in the rest periods woman have during pregnancy, providing as its main benefits 6 weeks prior to giving birth and 20 weeks after, as well as prohibition by employers to resign labor relation up to 2 years after giving birth.

(3) Reduction of the daily working time to 5 working days and 2 resting days

(4) Increase in the number of holidays during the year

The Company recognized a provision in respect of the impact of the new Labor Law, through the actuarial calculation prepared by independent actuaries contracted by PDVSA.

j) Sports organic Law

On August 24, 2011, the National Assembly published on the Official Gazette 39,741 the Sports Organic Law promoted by the Executive branch of power. This law declares of national and general interest as well as a public service all activities for promoting, organizing and administering sports and physical activity in Venezuela. The law among other things creates the National Fund for the Development of Sports, Physical Activity and Physical Education to be constituted on contributions from companies and organizations, private or public, performing profit seeking economic activities within the national territory. These contributions are not deductible for income tax purposes and shall be 1% over net profit when net profit is above 20,000 tax units. As of December 31, 2013, 2012 and 2011 the Company has recorded as contribution under the Sport Organic Law the amount of US$.6,337 thousands, US$.3,082 thousands and US$.1,110 thousands (Bs.39,923 thousands, Bs.13,253 thousands and Bs.4,773 thousands), respectively.

62

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

On February 28, 2012, Official Gazette No. 39,872 was published containing decree-law No. 8.820 on partial regulation No.1 to the Sports Organic Law. The partial regulation scope the National Fund for the Development of Sports, Physical Activity, duties of the National Sports Institute, guidelines on the executions of resources and taxpayers subject to the law and their responsibilities, as well as means of making contributions.

k) Law to Suppress and Liquidate the Endogenous Development Fund

On May 18, 2011, the National Assembly published on the Official Gazette 39,676 the means of decree-law No. 8.204 promoted by the President of the Bolivarian Republic of Venezuela, the Law to Liquidate and Suppress the Endogenous Development Fund, an autonomous institute created by the Law for the Creation of the Endogenous Development Fund, published in the National Gazette 38.500 on August 15, 2006.

l) Organic Law on Science and Technology and Innovation (LOCTI)

On December 2010, the Partial Amendment to the Organic Law on Science and Technology and Innovation (LOCTI) was published. This amendment establishes that legal or private or publicly owned entities, domiciled in the Bolivarian Republic of Venezuela or abroad, performing economic activities within the national territory are under the obligation of paying on an annual basis an established percentage of their gross income from the previous year, in respect to their business area, as follows:

• Two percent when economic activity is framed within those listed in the Law for the Control of Casinos, bingo Halls and Slot Machines, and any area related to industry and trade of Alcohol and snuff.

• One percent for privately owned enterprises operating in business areas subject to the Organic Law on Hydrocarbons and Gaseous Hydrocarbons, including mining, processing and distribution activities.

• Half percent for publicly owned companies if the business pursued is one of those listed in the Organic Law on Hydrocarbons and Gaseous Hydrocarbons including mining, processing and distribution activities.

• Half percent for any other business activity.

On April 28, 2011, the Company received instructions from its shareholder, CVP, to reverse the expense of US$.4,583 thousands (Bs.19,707 thousands) and accrued at December 31, 2010, due to the fact that PDVSA has opted to file declaration on behalf of its affiliates, including mix companies, and waive the liability on them, including Petrodelta, S.A. As of December 31, 2011, CVP sent instructions to the Company to record its share according to the law for its obligation corresponding to the year ended December 2011 only. The provision recorded in the statements of financial position corresponding to the year ended December 31, 2013, 2012 and 2011 amounts to US$.4,117 thousands, US$.5,238 thousands and US$.3,054 thousands (Bs.25,937 thousands, Bs.22,523 thousands and Bs.13,132 thousands), respectively.

63

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

m) Antidrug Organic Law (LOD)

On September 15, 2010, the Antidrug Organic Law was published in Official Gazette No. 39,510. The LOD eliminates the Law on Narcotic and Psychotropic Substances (LOCTISEP) and its partial regulation published June 5, 1996 under Official Gazette No. 35,986. Among the significant changes are:

• Taxable base is changed, previously considered base on net profit and now establishes as taxable base current period operating income.

• Filing and payment of tribute is extended from 15 calendar days of the following taxable period, to 60 calendar days from the closing corresponding taxable period.

• In relation to sanctions, the law establishes: 1) failure to comply the contribution of 1%, a penalty equivalent to double the amount due, if re-occur the penalty will be 3 times the corresponding contribution due, and 2) for not complying the special contribution of 2%, same penalty, before was 60,000 tax units or suspension of business activities during 1 year in case of re-occurrence.

• In the prior law, donations made by persons or companies in favor of plans and programs established by the government in relation to drugs matter and approved by ONA, can be deducted for income tax purposes, previously approved by public document. In the new law, this last aspect is eliminated as a requisite for proceeding to deduct from income tax purposes.

• Incorporates an obligation by government agencies and institutions, as well as public and private companies that employ more than 50 workers, to provide labor to rehabilitated persons, under the programs of social inclusions.

On February 23, 2011, providence No. 0001-2011 was published in the Official Gazette No. 39.622, establishing that labor matters related to Projects for Integral Prevention on Drug Consumption must be presented to the National Antidrug Fund (FONA). The providence establishes that private and public companies must present between January 2 and April 30 the projects and all of their requirements to be executed in order to carry-out technical and economical evaluations necessary for the appropriate approval. Projects for Integral Prevention in regards to labor matters can only be submitted by those companies in which their fiscal year ends before the established time frame mentioned in order to be eligible and once the contribution of 1% has been paid. When companies cannot submit projects, they can present them in the same timing period of the following year and the corresponding charge shall be the year immediately before to the year corresponding the contribution determination.

64

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

During the years ended December 31, 2013, 2012 and 2011, the Company recognized and recorded an expense for US$.4,155 thousands, US$.3,082 thousands and US$.3,328 thousands (Bs.26,177 thousands, Bs.13,253 thousands and Bs.14,311 thousands), respectively.

(24) Subsequent Events

a) On February 19, 2014, providence No. SNAT/2014/0008 from the National Integrated Service on Tributes and Customs Administration (SENIAT) was published in Official Gazette No. 40,359 in which the current tax unit value was adjusted from Bs.107 to Bs.127.

b) On February 11, 2014 the Collective Labor Agreement was signed, valid for the period from October 1, 2013 thru October 1, 2015, between the employees of the oil industry represented by the Venezuelan Unitary Federation of workers of the oil, gas, and derivatives (FUTPV) and PDVSA. The Collective Labor Agreement establishes a salary raise and payroll and retirement benefits which has a significant impact on the Company’s payroll cost. The most significant impacts are a step increase of salary around 90%, where 59% is to be retroactive from October 1, 2013, then a 23% raise from next May 1, 2014 and finally the remaining portion to be adjusted on January 1, 2015. Also, the benefit for electronic card was raise from Bs.2,700 to Bs. 5,000 per month. As of December 31, 2013, the Company recorded a provision in the amount of US$763 thousands (Bs.4,813 thousands) for the retroactive effect the new contract may have in the financial statements of the Company.

c) On February 24, 2014, the Venezuelan government published in the Extraordinary Official Gazette No. 6.126, Decree No.798 enacted by the President of the Bolivarian Republic of Venezuela by means of decree-law the Exchange Agreement and Violations. The object of this decree-law is to dictate terms and conditions for different state agencies with responsibilities on managing foreign currency as per different exchange agreement in place, permit the participation of private companies and individuals obtaining foreign currency and establish violations and sanctions when dealing with foreign currency. Furthermore, this decree-law permits individuals and private companies obtain foreign currency from the Venezuela Central Bank, Petróleos de Venezuela, S.A. and private companies and individuals, a condition exclusive of the Venezuela Central Bank in the prior law.

d) On March 12, 2014 the Board of Directors of the Company approved the issuance of the financial statements as of December 31, 2013, in accordance with International Financial Reporting Standards (IFRS) and resolved to submit these financial statements to the Shareholders of the Company and it is expected its approval with no modifications.

65

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(25) Supplementary Information on Oil and Gas Exploration and Production Activities (unaudited)

The following tables provide supplementary information on oil and gas exploration, development and production activities. All exploration and production activities are conducted mainly by CVP and Mixed Companies in Venezuela.

Table I - Crude Oil and Natural Gas Reserves

All crude oil and natural gas reserves located in Venezuela are owned by the Bolivarian Republic of Venezuela. Crude oil and natural gas reserves are estimated by PDVSA and reviewed by the People’s Power Ministry for Energy and Oil (MPPPM) using reserve criteria that are consistent with those prescribed by the American Petroleum Institute (API) of the United States of America.

Proved reserves are the estimated quantities of crude oil and gas which, with reasonable certainty, are recoverable in future years from known deposits under existing economic and operating conditions. Due to the inherent uncertainties and limited nature of reservoir data, reserve estimates are subject to changes over time, as additional information becomes available. Proved reserves do not include additional volumes which may result from the extension of currently explored areas or from the application of secondary recovery processes not yet tested and determined to be economically feasible.

Proved developed oil and gas reserves are the quantities that can be recovered from existing wells with existing equipment and methods. Proved undeveloped reserves are those volumes that are expected to be recovered from new wells on undrilled acreage or from existing wells.

A summary of annual changes in proved crude oil and natural gas reserves is shown below:

(a) Conventional Crude Oil (in thousands of barrels)

	Years ended December 31,
	2013			2012			2011
Proved developed and undeveloped reserves of conventional crude oil at January 1		857,628			499,237			511,320
Revisions		(217,990	)		—			(693	)
Expansions and discoveries		—			371,563			—
Production		(14,538	)		(13,172	)		(11,390	)
Proved developed and undeveloped reserves of conventional crude oil at December 31		625,100			857,628			499,237
Proved developed reserves of conventional crude oil at December 31 (included on the previous amount)		69,833			65,755			50,758

At December 31, 2013, 2012 and 2011, certified reserves assigned to the Company amounted to 625,100 thousands, 574,725 thousands and 499,237 thousands barrels, respectively. Production for the year ended December 31, 2013, 2012 and 2011 was 14,538 thousands, 13,172 thousands and 11,390 thousand barrels.

66

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

(b) Natural Gas Reserves (in millions of cubic feet)

	Years ended December 31,
	2013			2012			2011
Proved developed and undeveloped reserves of natural gas at January 1		705,457			532,082			548,880
Revisions		(247,882	)		—			(14,532	)
Expansions and discoveries					175,546			—
Production		(2,593	)		(2,171	)		(2,266	)
Proved developed and undeveloped reserves of natural gas at December 31		454,982			705,457			532,082
Proved developed reserves of natural gas at December 31 in Uracoa and Tucupita (included on the previous amount)		8,291			23,390			20,809

Natural gas production is shown on the basis of actual volumes before the extraction of liquefiable hydrocarbons.

Table II - Costs Incurred in Exploration and Development Activities

Exploration costs include costs incurred from geological and geophysical activities, and drilling and equipping exploratory wells. The Company did not conduct exploration activities in the year 2012. Development costs include those for drilling and equipping development wells, enhanced recovery projects and facilities to extract, treat and store crude oil and natural gas. Annual costs, summarized below, include amounts both expensed and capitalized for the Company’s conventional crude oil reserves (In thousands):

	Conventional Crude
	U.S. Dollars						Bolivars
	2013		2012		2011		2013		2012		2011
Development costs		264,075		207,320		141,763		1,663,673		891,479		609,581
Total costs incurred from development Activities		264,075		207,320		141,763		1,663,673		891,479		609,581

67

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

Table III - Costs Recorded as Assets in Oil and Gas Production Activities

Costs recorded as assets for oil and gas exploration and production activities, as well as the related accumulated depreciation and amortization at December 31 for PDVSA’s conventional and extra-heavy crude oil reserves are summarized below (In thousands):

	Conventional Crude
	U.S. Dollars									Bolivars
	2013			2012			2011			2013			2012			2011
Assets used in production		794,820			660,972			470,226			5,007,366			2,842,181			2,021,972
Equipment and facilities		16,685			22,447			15,576			105,116			96,522			66,977
		811,505			683,419			485,802			5,112,482			2,938,703			2,088,949
Accumulated Depletion, depreciation and amortization		(364,719	)		(279,117	)		(193,112	)		(2,297,730	)		(1,200,203	)		(830,382	)
Construction in progress		250,183			121,087			111,255			1,576,153			520,675			478,396
Total net costs capitalized as assets		696,969			525,389			403,945			4,390,905			2,259,175			1,736,963

Table IV - Results of Operations for Oil and Gas Production Activities for Each Year (In thousands):

	Conventional Crude
	Years ended December 31
	U.S. Dollar									Bolivars
	2013			2012			2011			2013			2012			2011
Net production income:
Sales (see Note 21)		1,330,098			1,263,010			1,125,694			8,379,618			5,430,943			4,840,482
Production costs		(187,311	)		(158,888	)		(113,985	)		(1,180,059	)		(683,219	)		(490,137	)
Royalties in kind and other taxes (see Note 7 and Note 21)		(620,694	)		(706,360	)		(607,442	)		(3,910,373	)		(3,037,348	)		(2,611,999	)
Contributions and funding for social development		(17,127	)		(14,889	)		(7,241	)		(107,900	)		(64,023	)		(31,137	)
Depletion, depreciation and Amortization		(82,018	)		(83,168	)		(56,693	)		(516,713	)		(357,622	)		(243,780	)
Results of operation before income Tax		422,948			299,705			340,333			2,664,573			1,288,731			1,463,429
Income tax		(211,474	)		(149,853	)		(170,167	)		(1,332,286	)		(644,366	)		(731,715	)
Results production operation		211,474			149,852			170,166			1,332,287			644,365			731,714

Income from oil production is calculated at international market price as if all production were sold (see Note 21).

Production costs are lifting costs incurred to operate and maintain productive wells and related facilities and equipment, including operating labor costs, materials, supplies, fuel consumed in operations and operating costs of natural liquid gas plants.

Depreciation and amortization expenses relate to assets used in exploration and production activities. Income tax expense is computed using the statutory rate for the year. For these purposes, the results of production operations do not include finance costs and corporate overhead or their associated tax effects.

68

PETRODELTA, S.A.

(Subsidiary owned 56% by Corporación Venezolana del Petróleo, S.A.)

Notes to the financial statements

December 31, 2013, 2012 and 2011

A summary of average per unit sale prices and production costs is shown below:

	Years ended December 31,
	2013		2012		2011		2013		2012		2011
	U.S. Dollar						Bolivars
Average sale price
Crude oil per barrel		91.22		95.90		98.52		574.69		412.37		423.64
Natural gas per BOE		1.54		1.54		1.54		9.70		6.62		6.62
Average production cost per BOE		12.51		11.74		9.69		78.81		50.48		41.67

69

EX-99.2

Exhibit 99.2

HNR FINANCE B. V.

Estimated

Future Reserves and Income

Attributable to Certain

Leasehold Interests

SEC Parameters

As of

December 31, 2013

Scott J. Wilson, P.E., MBA Colorado License No. 36112 Senior Vice President   RYDER SCOTT COMPANY, L.P. TBPE Firm License No. F-1580

RYDER SCOTT COMPANY    PETROLEUM CONSULTANTS

	TBPE REGISTERED ENGINEERING FIRM F-1580	FAX (303) 623-4258
	621 SEVENTEENTH STREET    SUITE 1550 DENVER, COLORADO 80293	TELEPHONE (303) 623-9147

February 26, 2014

HNR Finance B.V.

Prins Bernhardplein 200

P.O. Box 990

1000 AZ Amsterdam, Netherlands

Attention:	Harvest (US) Holdings, Inc. – Director A
	Fortis Intertrust (Netherlands) B.V. – Director B

Gentlemen:

At your request, Ryder Scott Company, L.P. (Ryder Scott) has prepared an estimate of the proved, probable and possible reserves, future production, and income attributable to HNR Finance B.V.’s (“HNR Finance”) interest in certain properties located in the Greater Oficina Trend of Eastern Venezuela. These properties are included in a company called Petrodelta S.A., in which HNR Finance has a 40 percent interest, Corporación Venezolana del Petroleo S.A. (CVP) has 56 percent interest, and PDVSA Social, S.A. has a 4 percent interest. The properties include six fields; Bombal, El Salto, Isleño, Temblador, Tucupita, and Uracoa, (“Petrodelta fields”). The reserves and income data were estimated based on the definitions and disclosure guidelines of the United States Securities and Exchange Commission (SEC) contained in Title 17, Code of Federal Regulations, Modernization of Oil and Gas Reporting, Final Rule released January 14, 2009 in the Federal Register (SEC regulations). Our third party study, completed on February 26, 2014 and presented herein, was prepared for public disclosure by HNR Finance in filings made with the SEC in accordance with the disclosure requirements set forth in the SEC regulations.

The properties evaluated by Ryder Scott represent 100 percent of the total net proved, probable and possible liquid hydrocarbon reserves and 100 percent of the total net proved, probable and possible gas reserves of HNR Finance as of December 31, 2013.

The estimated reserves and future net income amounts presented in this report, as of December 31, 2013 are related to hydrocarbon prices. The hydrocarbon prices used in the preparation of this report are based on the average prices during the 12-month period prior to the ending date of the period covered in this 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, as required by the SEC regulations. Actual future prices may vary significantly from the prices required by SEC regulations; therefore, volumes of reserves actually recovered and the amounts of income actually received may differ significantly from the estimated quantities presented in this report. The results of this study are summarized below.

1100 LOUISIANA STREET, SUITE 4600 HOUSTON, TEXAS 77002-5294	TEL (713) 651-9191	FAX (713) 651-0849
1015 4TH STREET S.W. SUITE 600 CALGARY, ALBERTA T2R 1J4	TEL (403) 262-2799	FAX (403) 262-2790

HNR Finance

February 26, 2014

Page 2

SEC PARAMETERS

Estimated Net Reserves and Income Data

Certain Interests of

HNR Finance

As of December 31, 2013

	Proved
	Developed				Undeveloped		Total Proved
	Producing		Non-Producing
Net Remaining Reserves
Oil/Condensate – Barrels		16,135,119		300,527		19,984,211		36,419,857
Gas – MMCF		17,554		2,897		4,346		24,797
Income Data ($M)
Future Gross Revenue	$	1,145,649	$	24,162	$	1,249,376	$	2,419,187
Deductions		575,809		12,279		853,485		1,441,573
Future Net Income (FNI)	$	569,840	$	11,883	$	395,891	$	977,614
Discounted FNI @ 10%	$	399,346	$	8,462	$	223,692	$	631,500

	Total Probable Undeveloped		Total Possible Undeveloped
Net Remaining Reserves
Oil/Condensate – Barrels		73,223,526		117,929,678
Gas – MMCF		49,214		32,423
Income Data ($M)
Future Gross Revenue	$	4,751,828	$	7,552,048
Deductions		3,247,790		5,139,613
Future Net Income (FNI)	$	1,504,038	$	2,412,435
Discounted FNI @ 10%	$	743,228	$	887,364

Liquid hydrocarbons are expressed in standard 42 gallon barrels. All gas volumes are reported on an “as sold” or used-in-operations basis expressed in millions of cubic feet (MMCF) at the official temperature and pressure bases of the areas in which the gas reserves are located. In this report, the revenues, deductions, and income data are expressed as thousands of U.S. dollars ($M).

The estimates of the reserves, future production, and income attributable to properties in this report were prepared using the economic software package PHDWin Petroleum Economic Evaluation Software, a copyrighted program of TRC Consultants L.C. The program was used at the request of HNR Finance. Ryder Scott has found this program to be generally acceptable, but notes that certain summaries and calculations may vary due to rounding and may not exactly match the sum of the properties being summarized. Furthermore, one line economic summaries may vary slightly from the more detailed cash flow projections of the same properties, also due to rounding. The rounding differences are not material.

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February 26, 2014

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The deductions incorporate the normal direct costs of operating the wells, recompletion costs and development costs. Net taxes levied by the Venezuela government are incorporated into the “other taxes” and the “federal income tax” categories. The Windfall Profit Tax on oil levied by Venezuela pursuant to the Windfall Profit Tax Law of 2011 is incorporated as a deduction to net oil price received. The future net income is before the deduction of U.S. state and federal income taxes and general administrative overhead, and has not been adjusted for outstanding loans that may exist nor does it include any adjustment for cash on hand or undistributed income.

Liquid hydrocarbon reserves account for approximately 99 percent and gas reserves account for the remaining 1 percent of total future gross revenue from proved reserves. Liquid hydrocarbon reserves account for approximately 98 percent and gas reserves account for the remaining 2 percent of total future gross revenue from probable reserves. Liquid hydrocarbon reserves account for approximately 99 percent and gas reserves account for the remaining 1 percent of total future gross revenue from possible reserves.

The discounted future net income shown above was calculated using a discount rate of 10 percent per annum compounded monthly. Future net income was discounted at four other discount rates which were also compounded monthly. These results are shown in summary form as follows.

	Discounted Future Net Income ($M)
	As of December 31, 2013
Discount Rate Percent	Total Proved	Total Probable	Total Possible
5	$775,084	$1,050,642	$1,462,162
8	$683,359	$852,464	$1,083,749
12	$585,774	$648,996	$726,062
15	$526,753	$530,876	$536,071

The results shown above are presented for your information and should not be construed as our estimate of fair market value.

Reserves Included in This Report

The proved, probable and possible reserves included herein conform to the definitions as set forth in the Securities and Exchange Commission’s Regulations Part 210.4-10(a). An abridged version of the SEC reserves definitions from 210.4-10(a) entitled “Petroleum Reserves Definitions” is included as an attachment to this report.

The various reserve status categories are defined under the attachment entitled “Petroleum Reserves Status Definitions and Guidelines” in this report. The proved, probable and possible developed non-producing reserves included herein consist of the behind pipe and shut-in categories.

No attempt was made to quantify or otherwise account for any accumulated gas production imbalances that may exist. The proved, probable and possible gas volumes presented herein include volumes of gas consumed in operations as reserves.

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

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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. At HNR Finance’s request, this report addresses the proved, probable and possible reserves attributable to the properties evaluated herein.

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.” The SEC has defined reasonable certainty for proved reserves, when based on deterministic methods, 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 therefrom, and the actual costs related thereto, could be more or less than the estimated amounts.

The reserves reported herein are limited to the period prior to expiration of current contracts providing the legal rights to produce or a revenue interest in such production unless evidence indicates that contract renewal is reasonably certain. The expiration of the current contracts is on October 25, 2027. Furthermore, properties in Venezuela may be subjected to significantly varying contractual fiscal terms that affect the net revenue to HNR Finance for the production of these volumes. The prices and economic return received for these net volumes can vary significantly based on the terms of these contracts. Therefore, when applicable, Ryder Scott reviewed the fiscal terms of such contracts and discussed with HNR Finance the net economic benefit attributed to such operations for the determination of the net hydrocarbon volumes and income thereof. Ryder Scott has not conducted an exhaustive audit or verification of such contractual information. Neither our review of such contractual information nor our acceptance of HNR Finance’s representations regarding such contractual information should be construed as a legal opinion on this matter.

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Ryder Scott did not evaluate the country and geopolitical risks in Venezuela where HNR Finance operates and has interests. HNR Finance’s operations may be subject to various levels of governmental controls and regulations. These controls and regulations may include, but may not be limited to, matters relating to land tenure and leasing, the legal rights to produce hydrocarbons including the granting, extension or termination of production sharing contracts, the fiscal terms of various production sharing contracts, drilling and production practices, environmental protection, marketing and pricing policies, royalties, various taxes and levies including income tax, and foreign trade and investment and are subject to change from time to time. Such changes in governmental regulations and policies may cause volumes of proved, probable and possible reserves actually recovered and amounts of proved, probable and possible income actually received to differ significantly from the estimated quantities.

The estimates of reserves presented herein were based upon a detailed study of the properties in which HNR Finance owns an interest; however, we have not made any field examination of the properties. No consideration was given in this report to potential environmental liabilities that may exist nor were any costs included for potential liabilities to restore and clean up damages, if any, caused by past operating practices.

Estimates of Reserves

The estimation of reserves involves two distinct determinations. The first determination results in the estimation of the quantities of recoverable oil and gas and the second determination results in the estimation of the uncertainty associated with those estimated quantities in accordance with the definitions set forth by the Securities and Exchange Commission’s Regulations Part 210.4-10(a). The process of estimating the quantities of recoverable oil and gas reserves relies on the use of certain generally accepted analytical procedures. These analytical procedures fall into three broad categories or methods: (1) performance-based methods, (2) volumetric-based methods and (3) analogy. These methods may be used singularly or in combination by the reserve evaluator in the process of estimating the quantities of reserves. Reserve evaluators must select the method or combination of methods which in their professional judgment is most appropriate given the nature and amount of reliable geoscience and engineering data available at the time of the estimate, the established or anticipated performance characteristics of the reservoir being evaluated, and the stage of development or producing maturity of the property.

In many cases, the analysis of the available geoscience and engineering data and the subsequent interpretation of this data may indicate a range of possible outcomes in an estimate, irrespective of the method selected by the evaluator. When a range in the quantity of reserves is identified, the evaluator must determine the uncertainty associated with the incremental quantities of the reserves. If the reserve quantities are estimated using the deterministic incremental approach, the uncertainty for each discrete incremental quantity of the reserves is addressed by the reserve category assigned by the evaluator. Therefore, it is the categorization of reserve quantities as proved, probable and/or possible that addresses the inherent uncertainty in the estimated quantities reported. For proved reserves, uncertainty is defined by the SEC as reasonable certainty wherein the “quantities actually recovered are much more likely than not to be achieved.” The SEC states that “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.” The SEC states that “possible reserves are those additional reserves that are less certain to be recovered than probable reserves and the total quantities ultimately recovered from a project have a low probability of exceeding proved plus probable plus possible reserves.” All quantities of reserves within the same reserve category must meet the SEC definitions as noted above.

RYDER SCOTT COMPANY     PETROLEUM CONSULTANTS

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February 26, 2014

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Estimates of reserves quantities and their associated reserve categories may be revised in the future as additional geoscience or engineering data become available. Furthermore, estimates of reserves quantities and their associated reserve categories may also be revised due to other factors such as changes in economic conditions, results of future operations, effects of regulation by governmental agencies or geopolitical or economic risks as previously noted herein.

The proved, probable, and possible reserves for the properties included herein were estimated by performance methods, the volumetric method, analogy, or a combination of methods. All of the proved producing reserves attributable to producing wells and/or reservoirs were estimated by performance methods. These performance methods include, but may not be limited to, decline curve analysis, material balance and/or reservoir simulation which utilized extrapolations of historical production and pressure data available through November 2013 in those cases where such data were considered to be definitive. The data utilized in this analysis were supplied to Ryder Scott by HNR Finance or obtained from public data sources and were considered sufficient for the purpose thereof.

All of the proved non-producing and undeveloped reserves included herein were estimated by a combination of the volumetric and analogy methods. All of the probable and possible reserves included herein were estimated by a combination of the volumetric and analogy methods. The volumetric analysis utilized pertinent well and seismic data supplied to Ryder Scott by HNR Finance or which we have obtained from public data sources that were available through November 2013. The data utilized from the analogues as well as well and seismic data incorporated into our volumetric analysis were considered sufficient for the purpose thereof.

To estimate economically recoverable proved, probable and possible oil and gas reserves and related future net cash flows, we consider many factors and assumptions including, but not limited to, the use of reservoir parameters derived from geological, geophysical and engineering data which cannot be measured directly, economic criteria based on current costs and SEC pricing requirements, and forecasts of future production rates. Under the SEC regulations 210.4-10(a)(22)(v) and (26), proved, probable and possible reserves must be anticipated to be economically producible from a given date forward based on existing economic conditions including the prices and costs at which economic producibility from a reservoir is to be determined. While it may reasonably be anticipated that the future prices received for the sale of production and the operating costs and other costs relating to such production may increase or decrease from those under existing economic conditions, such changes were, in accordance with rules adopted by the SEC, omitted from consideration in making this evaluation.

HNR Finance has informed us that they have furnished us all of the material accounts, records, geological and engineering data, and reports and other data required for this investigation. In preparing our forecast of future proved, probable and possible production and income, we have relied upon data furnished by HNR Finance with respect to property interests owned, production and well tests from examined wells, normal direct costs of operating the wells or leases, other costs such as transportation and/or processing fees, various taxes levied by the Venezuela government, recompletion and development costs, abandonment costs after salvage, product prices based on the SEC regulations, adjustments or differentials to product prices, geological structural and isochore maps, well logs, core analyses, and pressure measurements. Ryder Scott reviewed such factual data for its reasonableness; however, we have not conducted an independent verification of the data furnished by HNR Finance. We consider the factual data used in this report appropriate and sufficient for the purpose of preparing the estimates of reserves and future net revenues herein.

In summary, we consider the assumptions, data, methods and analytical procedures used in this report appropriate for the purpose hereof, and we have used all such methods and procedures that we consider necessary and appropriate to prepare the estimates of reserves herein. The proved, probable and possible reserves included herein were determined in conformance with the United States

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February 26, 2014

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Securities and Exchange Commission (SEC) Modernization of Oil and Gas Reporting; Final Rule, including all references to Regulation S-X and Regulation S-K, referred to herein collectively as the “SEC Regulations.” In our opinion, the proved, probable and possible reserves presented in this report comply with the definitions, guidelines and disclosure requirements as required by the SEC regulations.

Future Production Rates

For wells currently on production, our forecasts of future production rates are based on historical performance data. If no production decline trend has been established, future production rates were held constant, or adjusted for the effects of curtailment where appropriate, until a decline in ability to produce was anticipated. An estimated rate of decline was then applied to depletion of the reserves. If a decline trend has been established, this trend was used as the basis for estimating future production rates.

Test data and other related information were used to estimate the anticipated initial production rates for those wells or locations that are not currently producing. For reserves not yet on production, sales were estimated to commence at an anticipated date furnished by HNR Finance. Wells or locations that are not currently producing may start producing earlier or later than anticipated in our estimates due to unforeseen factors causing a change in the timing to initiate production. Such factors may include delays due to weather, the availability of rigs, the sequence of drilling, completing and/or recompleting wells and/or constraints set by regulatory bodies.

The future production rates from wells currently on production or wells or locations that are not currently producing may be more or less than estimated because of changes including, but not limited to, reservoir performance, operating conditions related to surface facilities, compression and artificial lift, pipeline capacity and/or operating conditions, producing market demand and/or allowables or other constraints set by regulatory bodies.

Hydrocarbon Prices

The hydrocarbon prices used herein are based on SEC price parameters using the average prices during the 12-month period prior to the ending date of the period covered in this 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. For hydrocarbon products sold under contract, the contract prices, including fixed and determinable escalations, exclusive of inflation adjustments, were used until expiration of the contract. Upon contract expiration, the prices were adjusted to the 12-month unweighted arithmetic average as previously described.

HNR Finance furnished us with the above mentioned average prices in effect on December 31, 2013. These initial SEC hydrocarbon prices were determined using the 12-month average first-day-of-the-month benchmark prices appropriate to the geographic area where the hydrocarbons are sold. These benchmark prices are prior to the adjustments for differentials as described herein. The table below summarizes the “benchmark prices” and “price reference” used for the geographic area included in the report. In certain geographic areas, the price reference and benchmark prices may be defined by contractual arrangements.

The product prices which were actually used to determine the future gross revenue for each property reflect adjustments to the benchmark prices for gravity, quality, local conditions, gathering and transportation fees and/or distance from market, referred to herein as “differentials.” The differentials used in the preparation of this report were furnished to us by HNR Finance.

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February 26, 2014

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In addition, the table below summarizes the net volume weighted benchmark prices adjusted for differentials and referred to herein as the “average realized prices.” The average realized prices shown in the table below were determined from the total future gross revenue before production taxes and the total net reserves by reserve category for the geographic area and presented in accordance with SEC disclosure requirements for each of the geographic areas included in the report. The average realized price before adjustment for Venezuela’s Windfall Profit tax is $84.14 /Bbl for the El Salto production and $ 97.89/Bbl for the production from the other fields.

Geographic Area	Prod	Field Area	Price Reference	Avg Benchmark Prices		Avg Proved Realized Prices		Avg Probable Realized Prices		Avg Possible Realized Prices
Venezuela	Oil	El Salto	WTI Cushing	$	96.78/Bbl	$	61.17/Bbl	$	61.17/Bbl	$	61.17/Bbl
	Oil	All Others	WTI Cushing	$	96.78/Bbl	$	75.61/Bbl	$	75.61/Bbl	$	75.61/Bbl
	Gas	All Fields	Defined Contract		N/A	$	0.95/MCF	$	1.54/MCF	$	1.54/MCF

The yearly average gas sales price is $1.54 / MCF in all categories. The average price reflected in the proved producing category, and summaries including this category are affected by fuel gas use which is scheduled using a zero gas price. The effects of derivative instruments designated as price hedges of oil and gas quantities are not reflected in our individual property evaluations.

Costs

Operating costs for the leases and wells in this report were furnished by HNR Finance and are based on the operating expense reports of HNR Finance and include only those costs directly applicable to the leases or wells. The operating costs include a portion of general and administrative costs allocated directly to the leases and wells. For operated properties, the operating costs include an appropriate level of corporate general administrative and overhead costs. The operating costs and foreign taxes furnished to us were accepted as factual data and reviewed by us for their reasonableness; however, we have not conducted an independent verification of the operating cost data used by HNR Finance. No deduction was made for loan repayments, interest expenses, or exploration and development prepayments that were not charged directly to the leases or wells.

Development costs were furnished to us by HNR Finance and are based on authorizations for expenditure for the proposed work or actual costs for similar projects. The development costs furnished to us were accepted as factual data and reviewed by us for their reasonableness; however, we have not conducted an independent verification of these costs. The estimated net cost of abandonment after salvage was included for properties where abandonment costs net of salvage were significant. The estimates of the net abandonment costs furnished by HNR Finance were accepted without independent verification.

The proved, probable and possible developed non-producing and undeveloped reserves in this report have been incorporated herein in accordance with HNR Finance’s plans to develop these reserves as of December 31, 2013. The implementation of HNR Finance’s development plans as presented to us and incorporated herein is subject to the approval process adopted by HNR Finance’s management. As the result of our inquiries during the course of preparing this report, HNR Finance has informed us that the development activities included herein have been subjected to and received the internal approvals required by HNR Finance’s management at the appropriate local, regional and/or

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February 26, 2014

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corporate level. In addition to the internal approvals as noted, certain development activities may still be subject to specific partner AFE processes, Joint Operating Agreement (JOA) requirements or other administrative approvals external to HNR Finance. Additionally, HNR Finance has informed us that they are not aware of any legal, regulatory, political or economic obstacles that would significantly alter their plans.

Current costs used by HNR Finance were held constant throughout the life of the properties.

Standards of Independence and Professional Qualification

Ryder Scott is an independent petroleum engineering consulting firm that has been providing petroleum consulting services throughout the world for over seventy-five years. Ryder Scott is employee-owned and maintains offices in Houston, Texas; Denver, Colorado; and Calgary, Alberta, Canada. We have over eighty engineers and geoscientists on our permanent staff. By virtue of the size of our firm and the large number of clients for which we provide services, no single client or job represents a material portion of our annual revenue. We do not serve as officers or directors of any privately-owned or publicly-traded oil and gas company and are separate and independent from the operating and investment decision-making process of our clients. This allows us to bring the highest level of independence and objectivity to each engagement for our services.

Ryder Scott actively participates in industry-related professional societies and organizes an annual public forum focused on the subject of reserves evaluations and SEC regulations. Many of our staff have authored or co-authored technical papers on the subject of reserves related topics. We encourage our staff to maintain and enhance their professional skills by actively participating in ongoing continuing education.

Prior to becoming an officer of the Company, Ryder Scott requires that staff engineers and geoscientists have received professional accreditation in the form of a registered or certified professional engineer’s license or a registered or certified professional geoscientist’s license, or the equivalent thereof, from an appropriate governmental authority or a recognized self-regulating professional organization.

We are independent petroleum engineers with respect to HNR Finance. Neither we nor any of our employees have any interest in the subject properties and neither the employment to do this work nor the compensation is contingent on our estimates of reserves for the properties which were reviewed.

The results of this study, presented herein, are based on technical analysis conducted by teams of geoscientists and engineers from Ryder Scott. The professional qualifications of the undersigned, the technical person primarily responsible for overseeing, reviewing and approving the evaluation of the reserves information discussed in this report, are included as an attachment to this letter.

Terms of Usage

The results of our third party study, presented in report form herein, were prepared in accordance with the disclosure requirements set forth in the SEC regulations and intended for public disclosure as an exhibit in filings made with the SEC by HNR Finance.

HNR Finance makes periodic filings on Form 10-K with the SEC under the 1934 Exchange Act. Furthermore, HNR Finance has certain registration statements filed with the SEC under the 1933 Securities Act into which any subsequently filed Form 10-K is incorporated by reference. We have

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February 26, 2014

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consented to the incorporation by reference in the registration statements on Form S-3 and Form S-8 of HNR Finance of the references to our name as well as to the references to our third party report for HNR Finance, which appears in the December 31, 2013 annual report on Form 10-K of HNR Finance. Our written consent for such use is included as a separate exhibit to the filings made with the SEC by HNR Finance.

We have provided HNR Finance with a digital version of the original signed copy of this report letter. In the event there are any differences between the digital version included in filings made by HNR Finance and the original signed report letter, the original signed report letter shall control and supersede the digital version.

The data and work papers used in the preparation of this report are available for examination by authorized parties in our offices. Please contact us if we can be of further service.

Very truly yours,

RYDER SCOTT COMPANY, L.P.

TBPE Firm Registration No. F-1580

Scott J. Wilson, P.E., M.B.A.

Colorado License No. 36112

Senior Vice President

SJW (DCR)/pl

RYDER SCOTT COMPANY     PETROLEUM CONSULTANTS

Professional Qualifications of Primary Technical Person

The conclusions presented in this report are the result of technical analysis conducted by teams of geoscientists and engineers from Ryder Scott Company, L.P. Mr. Scott James Wilson was the primary technical person responsible for the estimate of the reserves, future production, and income presented herein.

Mr. Wilson, an employee of Ryder Scott Company, L.P. (Ryder Scott) since 2000, is a Senior Vice President responsible for coordinating and supervising staff and consulting engineers of the company in ongoing reservoir evaluation studies worldwide. Before joining Ryder Scott, Mr. Wilson served in a number of engineering positions with Atlantic Richfield Company. For more information regarding Mr. Wilson’s geographic and job specific experience, please refer to the Ryder Scott Company website at http://www.ryderscott.com/Experience/Employees.php.

Mr. Wilson earned a Bachelor of Science degree in Petroleum Engineering from the Colorado School of Mines in 1983 and an MBA in Finance from the University of Colorado in 1985, graduating from both with High Honors. He is a registered Professional Engineer by exam in the States of Alaska, Colorado, Texas, and Wyoming. He is also an active member of the Society of Petroleum Engineers; serving as co-Chairman of the SPE Reserves and Economics Technology Interest Group, and Gas Technology Editor for SPE’s Journal of Petroleum Technology. He is a member and past chairman of the Denver section of the Society of Petroleum Evaluation Engineers. Mr. Wilson has published several technical papers, one book chapter, and has authored three US patents (two full and one pending).

In addition to gaining experience and competency through prior work experience, the various boards of Professional Engineers require a minimum of fifteen hours of continuing education annually, including at least one hour in the area of professional ethics, which Mr. Wilson fulfills. As part of his continuing education, Mr. Wilson attends internally presented training as well as public forums relating to the definitions and disclosure guidelines contained in the United States Securities and Exchange Commission Title 17, Code of Federal Regulations, Modernization of Oil and Gas Reporting, and Final Rule released January 14, 2009 in the Federal Register. Mr. Wilson attends additional hours of formalized external training covering such topics as the SPE/WPC/AAPG/SPEE Petroleum Resources Management System, reservoir engineering and petroleum economics evaluation methods, procedures and software and ethics for consultants.

Based on his educational background, professional training and more than 25 years of practical experience in the estimation and evaluation of petroleum reserves, Mr. Wilson has attained the professional qualifications as a Reserves Estimator and Reserves Auditor set forth in Article III of the “Standards Pertaining to the Estimating and Auditing of Oil and Gas Reserves Information” promulgated by the Society of Petroleum Engineers as of February 19, 2007.

RYDER SCOTT COMPANY     PETROLEUM CONSULTANTS

XML

Liquidity - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	0 Months Ended		0 Months Ended			12 Months Ended	0 Months Ended	12 Months Ended
	Dec. 16, 2013 Closings	Oct. 11, 2012	Dec. 16, 2013 Petrodelta, S.A. [Member]	Dec. 16, 2013 First Closing [Member]	Dec. 16, 2013 Second Closing [Member]	Dec. 31, 2013 Senior Notes [Member]	Dec. 16, 2013 Harvest Holding [Member]	Dec. 31, 2013 Harvest Holding [Member] Closings	Dec. 31, 2013 Harvest Holding [Member] Petrodelta, S.A. [Member]	Dec. 31, 2013 Harvest Holding [Member] Senior Notes [Member]
Change in Accounting Estimate [Line Items]
Interest indirectly owned in Harvest Holding					51.00%		80.00%		80.00%
Aggregate cash purchase price	$ 400				$ 275
Number of closings of Equity interest	2							2
Sale of equity interest in Harvest Holding				29.00%
Cost of Sale of Equity interest				125
Partner interest in equity method investee			60.00%
Percentage of debt instrument		11.00%				11.00%
Notes redeemed						80.0
Remaining proceeds from sale of equity interest										45
Estimated amount for payment of expenses and other costs related to sale of interest								4
Estimated amount for payment of taxes related to sale of interest								51.1
Estimated amount for payment of severance or other costs related to sale of interest								$ 20

XML

Investment in Equity Affiliate - Summary of Financial Information (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended								12 Months Ended
	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Adjustments to increase (decrease) net income under IFRS
Earnings from equity affiliate included in income income	$ (10,242)	$ 25,747	$ 7,602	$ 49,471	$ 7,745	$ 20,299	$ 22,829	$ 16,896	$ 72,578	$ 67,769	$ 73,451
Petrodelta, S.A. [Member]
Revenues:
Oil sales									1,326,093	1,263,264	1,122,191
Gas sales									4,000	3,350	3,497
Royalty									(440,963)	(423,069)	(374,135)
Revenue, total									889,130	843,545	751,553
EXPENSES:
Operating expenses									151,661	121,023	77,236
Workovers									29,168	17,302	28,508
Depletion, depreciation and amortization									87,203	86,004	58,376
General and administrative									26,345	31,753	11,297
Windfall profits tax									234,453	291,355	237,632
Windfall profits credit									(55,168)	0	0
Total expenses									473,662	547,437	413,049
Income from operations									415,468	296,108	338,504
Gain on exchange rate									169,582	0	0
Investment earnings and other									15	13	610
Interest expense									(21,728)	(7,017)	(10,699)
Income before income tax									563,337	289,104	328,415
Current income tax expense									325,217	127,080	190,577
Deferred income tax expense (benefit)									(17,662)	76,030	(94,622)
Net income under IFRS									255,782	85,994	232,460
Adjustments to increase (decrease) net income under IFRS
Deferred income tax (expense) benefit									9,080	78,968	(49,545)
Depletion expense									(20,352)	7,282	1,908
Reversal of windfall profits tax credit									(55,168)	0	0
Sports law over accrual									1,313	2,536	0
Net income under U.S. GAAP									190,655	174,780	184,823
Equity interest in equity affiliate									40.00%	40.00%	40.00%
Income before amortization of excess basis in equity affiliate									76,262	69,912	73,929
Amortization of excess basis in equity affiliate									(3,684)	(2,143)	(1,863)
Earnings from equity affiliate included in income income									$ 72,578	$ 67,769	$ 72,066

XML

Summary of Significant Accounting Policies - Schedule of Valuation and Qualifying Accounts (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Deferred tax valuation allowance [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Balance at Beginning of Year	$ 68,419	$ 53,116	$ 46,905
Charged to Income	0	15,303	6,211
Charged to Other Accounts	0	0	0
Deductions From Reserves Credited to Income	(8,843)	0	0
Balance at End of Year	59,576	68,419	53,116
Investment valuation allowances [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Balance at Beginning of Year	1,350	1,350	1,350
Charged to Income	0	0	0
Charged to Other Accounts	0	0	0
Deductions From Reserves Credited to Income	0	0	0
Balance at End of Year	1,350	1,350	1,350
VAT receivable valuation allowance [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Balance at Beginning of Year	0
Charged to Income	2,792
Charged to Other Accounts	0
Deductions From Reserves Credited to Income	0
Balance at End of Year	$ 2,792

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Taxes - Additional Information (Detail) (USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Income Taxes [Line Items]
Income tax on undistributed earnings of foreign subsidiaries	$ 89,900,000
Realized tax gain	47,500,000
Offset taxable income future period	8,400,000
AMT credit carryforward	2,100,000
Operating loss carryforwards	0
Accumulated undistributed earnings of foreign subsidiaries resulting from unremitted earnings	334,800,000
Current deferred tax liability	43,162,000	0
Uncertain tax positions	5,600,000
Net income tax benefit	2,200,000
Accrued interest	0
Accrued penalty	100,000
Venezuela [Member]
Income Taxes [Line Items]
Foreign operating loss carryforwards	100,000
Prior Year [Member]
Income Taxes [Line Items]
Offset taxable income by loss	10,800,000
Current Year [Member]
Income Taxes [Line Items]
Offset taxable income by loss	$ 36,700,000

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Investment in Equity Affiliate - Schedule of Assets and Liabilities (Detail) (Petrodelta, S.A. [Member], USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Petrodelta, S.A. [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Current assets	$ 1,906,595	$ 1,425,115
Property and equipment	717,449	538,351
Other assets	181,116	70,468
Current liabilities	1,652,806	1,180,559
Other liabilities	136,298	93,101
Net equity	$ 1,016,056	$ 760,274

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Stock-Based Compensation and Stock Purchase Plans - Long Term Incentive Plans - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2013
2006 Long term Incentive Plan [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Issuance of shares of common stock, authorized	1,825,000
Shares authorized to be granted as restricted stock	325,000
2006 Long term Incentive Plan [Member] | Options [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Shares authorized to be granted as stock options or SARs	900,000
2006 Long term Incentive Plan [Member] | Restricted Stock [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Maximum shares of restricted stock that can be granted	175,000
Period of restricted stock grant	3 years
2004 Long term Incentive Plan [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Issuance of shares of common stock, authorized	1,750,000
Shares authorized to be granted as restricted stock	438,000
2004 Long term Incentive Plan [Member] | Options [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Shares authorized to be granted as stock options or SARs	438,000
2004 Long term Incentive Plan [Member] | Restricted Stock [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Maximum shares of restricted stock that can be granted	110,000
2001 Long term Incentive Plan [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Issuance of shares of common stock, authorized	1,697,000
Shares grant period	1 year
2001 Long term Incentive Plan [Member] | Options [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Shares authorized to be granted as stock options or SARs	500,000
2010 Long term Incentive Plan [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Issuance of shares of common stock, authorized	2,725,000
Shares authorized to be granted as restricted stock	700,000
2010 Long term Incentive Plan [Member] | Options [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Shares authorized to be granted as stock options or SARs	1,000,000

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Summary of Significant Accounting Policies - Fair Value of Liabilities and Their Placement With in Fair Value Hierarchy Levels (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Liabilities:
Warrant derivative liability	$ 1,953	$ 5,470
Embedded derivative-debt	0	0
Total derivative liabilities	1,953	5,470
Level 1 input [Member]
Liabilities:
Warrant derivative liability	0	0
Embedded derivative-debt	0	0
Total derivative liabilities	0	0
Level 2 input [Member]
Liabilities:
Warrant derivative liability	0	0
Embedded derivative-debt	0	0
Total derivative liabilities	0	0
Level 3 input [Member]
Liabilities:
Warrant derivative liability	1,953	5,470
Embedded derivative-debt	0	0
Total derivative liabilities	$ 1,953	$ 5,470

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Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2013

Commitments And Contingencies Disclosure [Abstract]

Lease Commitments for Office Space

At December 31, 2013 we had the following lease commitments for office space (in thousands):

	Payments Due by Period
	Total		Less than 1 Year		1-2 Years		3-4 Years		After 4 Years
Office leases	$	583	$	521	$	62	$	0	$	0

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Stock-Based Compensation and Stock Purchase Plans - Stock Options - Additional Information (Detail) (Options [Member], USD $) In Millions, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Schedule Of Share Based Compensation Arrangements [Line Items]
Stock options remained available for grant	52,333	85,006
Vesting term	3 years
Options exercisable, shares	2,905,000	2,500,000	2,200,000
Options exercisable, weighted-average exercise price	$ 9.85	$ 10.12	$ 10.15
Option vesting period	3 years
Stock options awarded to employees and executive officers	920,004	451,298	498,500
Number of options issued	20,000
Options issued, exercise price	$ 6.10
Consecutive trading days for options to vest	10 days
Total intrinsic value of stock options exercised	$ 0.1	$ 0.3	$ 1.4
Total fair value shares vested	1.9	1.9	2.7
Total future compensation cost related to unvested stock option awards that are expected to vest	$ 3.1
Expected weighted average period of recognizing compensation cost	2 years 1 month 6 days
2001 Long term Incentive Plan [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Number of options issued	85,000
Options issued, exercise price	$ 10.80
Exercise price $10.91 [Member] | 2004 Long term Incentive Plan [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Number of options issued	225,000
Options issued, exercise price	$ 10.91
Exercise price $10.80 [Member] | 2004 Long term Incentive Plan [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Number of options issued	165,000
Options issued, exercise price	$ 10.80
Minimum [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Stock options granted under the plans, expiry period from date of grant	5 years
Average closing price of common stock	$ 20
Maximum [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Stock options granted under the plans, expiry period from date of grant	10 years

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Taxes - Income Tax Expense (Benefit) on Continuing Operations at Federal Statutory Rate (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended								12 Months Ended
	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Income tax expense (benefit) from continuing operations:
Tax expense (benefit) at U.S. statutory rate									$ (25,129)	$ (17,938)	$ (30,805)
Effect of foreign source income and rate differentials on foreign income									204	239	4,887
Tax gain associated with sale of interest in Harvest Holding	7,474								7,474
Subpart F income									16,615
Tax on unremitted earnings of foreign subsidiaries	89,900								89,900
Expired losses									1,356
Other changes in valuation allowance									(10,643)	10,331	28,169
Change in applicable statutory rate									(404)
Other permanent differences									(2,546)	1,431
Return to accrual and other true-ups									2,919	1,257
Debt exchange										2,758
Warrant derivatives									(1,180)		(1,445)
Liability for uncertain tax positions									(5,553)	799	237
Other									74	514	14
Total income tax expense - continuing operations	(75,228)	765	1,415	(39)	90	(1,723)	1,022	1,220	73,087	(609)	1,057
Income tax expense (benefit) from discontinued operations:
Total income tax expense (benefit) - discontinued operations											5,748
Total income tax expense (benefit)									$ 73,087	$ (609)	$ 6,805

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Stock-Based Compensation and Stock Purchase Plans - Summary of RSU Awards (Detail) (Restricted Stock Units (RSUs) [Member], USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Restricted Stock Units (RSUs) [Member]
Summary of unvested stock option awards
Unvested Outstanding, shares, beginning balance	530,006
Outstanding Granted, shares	190,002	388,000	0
Outstanding Vested, shares	(202,668)
Outstanding Forfeited, shares	(5,000)
Unvested Outstanding, shares, ending balance	322,338	530,006
Unvested Outstanding, Weighted-Average Grant - Date Fair Value, beginning balance	$ 9.07
Granted, Weighted-Average Grant - Date Fair Value
Vested, Weighted-Average Grant - Date Fair Value	$ (4.12)
Forfeited, Weighted-Average Grant - Date Fair Value	$ (4.52)
Unvested Outstanding, Weighted-Average Grant - Date Fair Value, ending balance	$ 4.52	$ 9.07

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Venezuela - Other - Additional Information (Detail) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 USD ($)	Dec. 31, 2012 USD ($)	Dec. 31, 2013 Harvest Vinccler [Member] VEB
Intercompany Foreign Currency Balance [Line Items]
Exchange value of foreign currency to domestic currency	$ 1.6	$ 1.5
Foreign currency average exchange rate	6.90	5.16
Assets account, balance			10.2
Liabilities account, balance			7.2

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Taxes - Unrecognized Tax Benefits (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Reconciliation Of Unrecognized Tax Benefits Excluding Amounts Pertaining To Examined Tax Returns [Roll Forward]
Balance at beginning of year	$ 5,871	$ 5,072
Additions for tax positions of prior years		799
Reductions for tax positions of prior years	(5,553)
Balance at end of year	$ 318	$ 5,871

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Stock-Based Compensation and Stock Purchase Plans - SAR Award Transactions under Stock-Based Employee Compensation Plans (Detail) (Stock Appreciation Rights (SARs) [Member], USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Stock Appreciation Rights (SARs) [Member]
SAR award transactions under stock-based employee compensation plans
Unvested Outstanding, shares, beginning balance	932,202
Granted, Shares	213,996	707,202	0
Exercised, Shares	0
Cancelled, Shares	(19,000)
Unvested Outstanding, shares, ending balance	1,127,198	932,202
SARs exercisable at end of the year, shares	394,394
Weighted-Average Exercise Price, beginning balance	$ 4.99
Weighted-Average Exercise Price, Granted	$ 4.80
Weighted-Average Exercise Price, Exercised
Weighted-Average Exercise Price, Cancelled	$ (5.12)
Weighted-Average Exercise Price, ending balance	$ 4.95	$ 4.99
SARs exercisable at end of the year, Weighted Average Exercise Price	$ 4.91	$ 4.60	$ 4.60
SARs outstanding as of December 31, 2013	3 years 3 months 4 days
SARs exercisable as of December 31, 2013	2 years 10 months 2 days
SARs outstanding, Aggregate Intrinsic Value	$ 0
SARs exercisable at end of the year, Aggregate Intrinsic Value	$ 0

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Stock-Based Compensation and Stock Purchase Plans - Summary of Value of Option Grant Estimated on Date of Grant (Detail) (USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Share Based Compensation Arrangement By Share Based Payment Award Fair Value Assumptions And Methodology [Abstract]
Weighted average fair value	$ 3.06	$ 2.85	$ 5.92
Weighted average expected life	5 years	5 years	5 years
Expected volatility	79.40%	67.30%	61.30%
Risk-free interest rate	1.30%	0.70%	1.80%
Dividend yield	0.00%	0.00%	0.00%

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Stock-Based Compensation and Stock Purchase Plans - Summary of Unvested SAR Awards (Detail) (Unvested Stock Appreciation Rights [Member], USD $)	12 Months Ended
	Dec. 31, 2013
Unvested Stock Appreciation Rights [Member]
Summary of unvested stock option awards
Unvested Outstanding, shares, beginning balance	857,205
Outstanding Granted, shares	213,996
Outstanding Vested, shares	(323,063)
Outstanding Forfeited, shares	(15,334)
Unvested Outstanding, shares, ending balance	732,804
Unvested Outstanding, Weighted-Average Grant - Date Fair Value, beginning balance	$ 6.18
Granted, Weighted-Average Grant - Date Fair Value	$ 2.73
Vested, Weighted-Average Grant - Date Fair Value	$ (2.46)
Forfeited, Weighted-Average Grant - Date Fair Value	$ (2.47)
Unvested Outstanding, Weighted-Average Grant - Date Fair Value, ending balance	$ 2.54

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Stock-Based Compensation and Stock Purchase Plans - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Allocated share-based compensation expense	2.3	5.2	4.8
Actual tax benefit realized from share-based awards	$ 0	$ 0	$ 2,535

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Taxes - Components of Loss from Continuing Operations Before Income Taxes (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended								12 Months Ended
	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Loss before income taxes
United States									$ (31,072)	$ (33,841)	$ (30,309)
Foreign									(40,725)	(18,915)	(58,193)
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES	$ (40,673)	$ (17,280)	$ (10,926)	$ (2,918)	$ (22,999)	$ (8,428)	$ (10,922)	$ (10,407)	$ (71,797)	$ (52,756)	$ (88,502)

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Quarterly Financial Data (unaudited)

12 Months Ended

Dec. 31, 2013

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Data (unaudited)

Note 18 – Quarterly Financial Data (unaudited)

Summarized quarterly financial data is as follows:

	Quarter Ended
	March 31			June 30			September 30			December 31
	(amounts in thousands, except per share data)
Year ended December 31, 2013
Expenses	$	(5,171	)	$	(9,653	)	$	(9,516	)	$	(21,096	)
Non-operating loss		2,253			(1,273	)		(7,764	)		(19,577	)
Loss from continuing operations before income taxes		(2,918	)		(10,926	)		(17,280	)		(40,673	)
Income tax expense (benefit)		39			(1,415	)		(765	)		75,228
Loss from continuing operations		(2,957	)		(9,511	)		(16,515	)		(115,901	)
Earnings (loss) from equity affiliate		49,471			7,602			25,747			(10,242	)
Income (loss) from continuing operations		46,514			(1,909	)		9,232			(126,143	)
Discontinued operations		(485	)		(1,006	)		(2,586	)		(1,073	)
Net income (loss)		46,029			(2,915	)		6,646			(127,216	)
Less: net income (loss) attributable to noncontrolling interest		9,932			1,551			4,693			(4,536	)
Net income (loss) attributable to Harvest	$	36,097		$	(4,466	)	$	1,953		$	(122,680	)
Basic Earnings (Loss) per Share:
Income (loss) from continuing operations	$	0.93		$	(0.09	)	$	0.12		$	(2.99	)
Discontinued operations		(0.01	)		(0.03	)		(0.07	)		(0.03	)
Net income (loss) attributable to Harvest	$	0.92		$	(0.12	)	$	0.05		$	(3.02	)
Diluted Earnings (Loss) per Share:
Income (loss) from continuing operations	$	0.92		$	(0.09	)	$	0.12		$	(2.99	)
Discontinued operations		(0.01	)		(0.03	)		(0.07	)		(0.03	)
Net income (loss) attributable to Harvest	$	0.91		$	(0.12	)	$	0.05		$	(3.02	)

	Quarter Ended
	March 31			June 30			September 30			December 31
	(amounts in thousands, except per share data)
Year ended December 31, 2012
Expenses	$	(8,128	)	$	(7,837	)	$	(6,694	)	$	(16,167	)
Non-operating loss		(2,279	)		(3,085	)		(1,734	)		(6,832	)
Loss from continuing operations before income taxes		(10,407	)		(10,922	)		(8,428	)		(22,999	)
Income tax expense (benefit)		(1,220	)		(1,022	)		1,723			(90	)
Loss from continuing operations		(9,187	)		(9,900	)		(10,151	)		(22,909	)
Earnings from equity affiliate		16,896			22,829			20,299			7,745
Income (loss) from continuing operations		7,709			12,929			10,148			(15,164	)
Discontinued operations		(5,427	)		(2,164	)		(347	)		(6,472	)
Net income (loss)		2,282			10,765			9,801			(21,636	)
Less: net income attributable to noncontrolling interest		3,322			4,540			4,050			1,511
Net income (loss) attributable to Harvest	$	(1,040	)	$	6,225		$	5,751		$	(23,147	)
Basic Earnings (Loss) per Share:
Income (loss) from continuing operations	$	0.13		$	0.23		$	0.16		$	(0.43	)
Discontinued operations		(0.16	)		(0.06	)		(0.01	)		(0.16	)
Net income (loss) attributable to Harvest	$	(0.03	)	$	0.17		$	0.15		$	(0.59	)
Diluted Earnings (Loss) per Share:
Income (loss) from continuing operations	$	0.12		$	0.21		$	0.16		$	(0.43	)
Discontinued operations		(0.14	)		(0.06	)		(0.01	)		(0.16	)
Net income (loss) attributable to Harvest	$	(0.02	)	$	0.15		$	0.15		$	(0.59	)

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Earnings Per Share - Additional Information (Detail) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Options [Member]
Dilutive Securities Included And Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share, Amount	4.2	3.9	3.7
Warrants [Member]
Dilutive Securities Included And Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share, Amount	2.5	2.4	1.6

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Summary of Significant Accounting Policies - Unproved Property Costs (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Capitalized Costs of Unproved Properties Excluded from Amortization [Line Items]
Unproved property cost	$ 103,917	$ 78,453
Budong PSC [Member]
Capitalized Costs of Unproved Properties Excluded from Amortization [Line Items]
Unproved property cost	4,470	5,219
Dussafu PSC [Member]
Capitalized Costs of Unproved Properties Excluded from Amortization [Line Items]
Unproved property cost	$ 99,447	$ 73,234

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Taxes - Primary Income Tax Jurisdictions and their Respective Audit Years (Detail)	12 Months Ended
	Dec. 31, 2013
United States [Member]
Open Tax Years By Major Jurisdiction [Line Items]
Open tax audit beginning year	2010
Open tax audit ending year	2013
The Netherlands [Member]
Open Tax Years By Major Jurisdiction [Line Items]
Open tax audit beginning year	2010
Open tax audit ending year	2013
Singapore [Member]
Open Tax Years By Major Jurisdiction [Line Items]
Open tax audit beginning year	2009
Open tax audit ending year	2013
United Kingdom [Member]
Open Tax Years By Major Jurisdiction [Line Items]
Open tax audit beginning year	2012
Open tax audit ending year	2013
Venezuela [Member]
Open Tax Years By Major Jurisdiction [Line Items]
Open tax audit beginning year	2009
Open tax audit ending year	2013
Colombia [Member]
Open Tax Years By Major Jurisdiction [Line Items]
Open tax audit year	2013

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Quarterly Financial Data (unaudited) (Tables)

12 Months Ended

Dec. 31, 2013

Quarterly Financial Information Disclosure [Abstract]

Summarized Quarterly Financial Data

Summarized quarterly financial data is as follows:

	Quarter Ended
	March 31			June 30			September 30			December 31
	(amounts in thousands, except per share data)
Year ended December 31, 2013
Expenses	$	(5,171	)	$	(9,653	)	$	(9,516	)	$	(21,096	)
Non-operating loss		2,253			(1,273	)		(7,764	)		(19,577	)
Loss from continuing operations before income taxes		(2,918	)		(10,926	)		(17,280	)		(40,673	)
Income tax expense (benefit)		39			(1,415	)		(765	)		75,228
Loss from continuing operations		(2,957	)		(9,511	)		(16,515	)		(115,901	)
Earnings (loss) from equity affiliate		49,471			7,602			25,747			(10,242	)
Income (loss) from continuing operations		46,514			(1,909	)		9,232			(126,143	)
Discontinued operations		(485	)		(1,006	)		(2,586	)		(1,073	)
Net income (loss)		46,029			(2,915	)		6,646			(127,216	)
Less: net income (loss) attributable to noncontrolling interest		9,932			1,551			4,693			(4,536	)
Net income (loss) attributable to Harvest	$	36,097		$	(4,466	)	$	1,953		$	(122,680	)
Basic Earnings (Loss) per Share:
Income (loss) from continuing operations	$	0.93		$	(0.09	)	$	0.12		$	(2.99	)
Discontinued operations		(0.01	)		(0.03	)		(0.07	)		(0.03	)
Net income (loss) attributable to Harvest	$	0.92		$	(0.12	)	$	0.05		$	(3.02	)
Diluted Earnings (Loss) per Share:
Income (loss) from continuing operations	$	0.92		$	(0.09	)	$	0.12		$	(2.99	)
Discontinued operations		(0.01	)		(0.03	)		(0.07	)		(0.03	)
Net income (loss) attributable to Harvest	$	0.91		$	(0.12	)	$	0.05		$	(3.02	)

	Quarter Ended
	March 31			June 30			September 30			December 31
	(amounts in thousands, except per share data)
Year ended December 31, 2012
Expenses	$	(8,128	)	$	(7,837	)	$	(6,694	)	$	(16,167	)
Non-operating loss		(2,279	)		(3,085	)		(1,734	)		(6,832	)
Loss from continuing operations before income taxes		(10,407	)		(10,922	)		(8,428	)		(22,999	)
Income tax expense (benefit)		(1,220	)		(1,022	)		1,723			(90	)
Loss from continuing operations		(9,187	)		(9,900	)		(10,151	)		(22,909	)
Earnings from equity affiliate		16,896			22,829			20,299			7,745
Income (loss) from continuing operations		7,709			12,929			10,148			(15,164	)
Discontinued operations		(5,427	)		(2,164	)		(347	)		(6,472	)
Net income (loss)		2,282			10,765			9,801			(21,636	)
Less: net income attributable to noncontrolling interest		3,322			4,540			4,050			1,511
Net income (loss) attributable to Harvest	$	(1,040	)	$	6,225		$	5,751		$	(23,147	)
Basic Earnings (Loss) per Share:
Income (loss) from continuing operations	$	0.13		$	0.23		$	0.16		$	(0.43	)
Discontinued operations		(0.16	)		(0.06	)		(0.01	)		(0.16	)
Net income (loss) attributable to Harvest	$	(0.03	)	$	0.17		$	0.15		$	(0.59	)
Diluted Earnings (Loss) per Share:
Income (loss) from continuing operations	$	0.12		$	0.21		$	0.16		$	(0.43	)
Discontinued operations		(0.14	)		(0.06	)		(0.01	)		(0.16	)
Net income (loss) attributable to Harvest	$	(0.02	)	$	0.15		$	0.15		$	(0.59	)

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Dispositions - Revenue and Net Income (Loss) on Disposition (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Revenue applicable to discontinued operations	$ 0	$ 0	$ 6,488
Net income (loss) from discontinued operations	(5,150)	(14,410)	86,245
Oman [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Revenue applicable to discontinued operations	0	0	0
Net income (loss) from discontinued operations	(674)	(12,711)	(11,371)
Colombia [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Revenue applicable to discontinued operations	0	0	0
Net income (loss) from discontinued operations	(4,476)	0	0
Antelope Project [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Revenue applicable to discontinued operations	0	0	6,488
Net income (loss) from discontinued operations	$ 0	$ (1,699)	$ 97,616

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Commitments and Contingencies - Additional Information (Detail)	0 Months Ended	1 Months Ended	12 Months Ended				1 Months Ended				12 Months Ended	0 Months Ended	1 Months Ended			12 Months Ended
	Jul. 24, 2013 USD ($) Plaintiff	May 31, 2011 USD ($)	Dec. 31, 2013 USD ($) Person	Dec. 31, 2013 IDR	Dec. 31, 2012 USD ($)	Dec. 31, 2011 USD ($)	Mar. 31, 2007 Uracoa Municipality Tax Assessments [Member] Claim	Aug. 31, 2006 Uracoa Municipality Tax Assessments [Member] Claim	Jul. 31, 2006 Uracoa Municipality Tax Assessments [Member] Claim	Jul. 31, 2004 Uracoa Municipality Tax Assessments [Member] Claim	Dec. 31, 2013 Uracoa Municipality Tax Assessments [Member] Assessment	May 04, 2012 Libertador Municipality Tax Assessments [Member] Claim	Jul. 31, 2007 Libertador Municipality Tax Assessments [Member] Claim	Jun. 30, 2007 Libertador Municipality Tax Assessments [Member] Claim	Apr. 30, 2005 Libertador Municipality Tax Assessments [Member] Claim	Dec. 31, 2013 Libertador Municipality Tax Assessments [Member] Assessment	Dec. 31, 2013 Farmout Agreements [Member] USD ($)
Legal Contingencies [Line Items]
Number of executive officers under employment contacts			5	5
Notice period for terminating employment contract			1 year	1 year
Termination date of employment contracts			May 31, 2013	May 31, 2013
Period of initial exploration phase			6 years	6 years
Date granted for extended period of initial exploration phase			Jan. 15, 2017	Jan. 15, 2017
Extended period of initial exploration phase			4 years	4 years
Percentage of expected amount to pay partner			7.10%	7.10%
Expected amount to pay partner			$ 3,200,000
Complaint alleged damages amount	2,900,000
Number of Plaintiffs	70
Compensation claim for land local currency				16,000,000,000
Compensation claim for land USD value at cost			1,700,000
Compensation claim for land USD value net to cost sharing interest			1,200,000
Percentage of cost sharing interest in work commitments			71.61%	71.61%
Purchased land value, at cost			4,100
Blocked payment at cost		1,100,000
Blocked payment net to cost sharing interest		700,000	734,000		734,000
Date of OFAC application for return of blocked funds			Oct. 26, 2011	Oct. 26, 2011
Cost sharing interest		66.667%	66.667%	66.667%	66.667%
Number of tax assessments											9					5
Number of claim filed							2	2	2	3			2	2	1
Number of claim dismissed												1
Impairment charge			575,000		2,900,000	3,335,000											3,200,000
Accrual of impairment charge																	$ 2,000,000

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Debt - Summary of Debt (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012	Oct. 11, 2012
Debt Instrument [Line Items]
Discount on 11% senior unsecured notes	$ (2,270)	$ (4,911)
Less current portion	(77,480)	0
Total debt	0	74,839
11% senior unsecured notes [Member]
Debt Instrument [Line Items]
Senior notes, unsecured, with interest at 11%	$ 79,750	$ 79,750	$ 79,800

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Summary of Significant Accounting Policies - Schedule of Reconciliation of Financial Liabilities Measured at Fair Value on Recurring Basis Using Significant Unobservable Inputs (Level 3) (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Financial liabilities:
Beginning balance	$ 5,470	$ 4,870
Unrealized change in fair value	(3,517)	600
Ending balance	$ 1,953	$ 5,470

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Liquidity

12 Months Ended

Dec. 31, 2013

Text Block [Abstract]

Liquidity

Note 2 – Liquidity

Historically, our primary ongoing source of cash has been dividends from Petrodelta and the sale of oil and gas properties. Our primary use of cash has been to fund oil and gas exploration projects, principal payments on debt, interest, and general and administrative costs. We require capital principally to fund the exploration and development of new oil and gas properties. As is common in the oil and gas industry, we have various contractual commitments pertaining to exploration, development and production activities. See Note 8 – Gabon, Note 9 – Indonesia and Note 5 – Dispositions, Discontinued Operations for our contractual commitments.

The environments in which we operate are often difficult and the ability to operate successfully depends on a number of factors including our ability to control the pace of development, our ability to apply “best practices” in drilling and development, and the fostering of productive and transparent relationships with local partners, the local community and governmental authorities. Financial risks include our ability to control costs and attract financing for our projects. In addition, often the legal systems of certain countries are not mature, and their reliability can be uncertain. This may affect our ability to enforce contracts and achieve certainty in our rights to develop and operate oil and natural gas projects, as well as our ability to obtain adequate compensation for any resulting losses. Our strategy depends on our ability to have significant influence over operations and financial control.

Our operations are subject to various risks inherent in foreign operations. These risks may include, among other things, loss of revenue, property and equipment as a result of hazards such as expropriation, nationalization, war, insurrection, civil unrest, strikes and other political risks, increases in taxes and governmental royalties, being subject to foreign laws, legal systems and the exclusive jurisdiction of foreign courts or tribunals, renegotiation of contracts with governmental entities, changes in laws and policies, including taxes, governing operations of foreign-based companies, currency restrictions and exchange rate fluctuations and other uncertainties arising out of foreign government sovereignty over our international operations. Our international operations may also be adversely affected by the U.S. Foreign Corrupt Practices Act and similar worldwide anti-corruption laws, laws and policies of the United States affecting foreign policy, foreign trade, taxation and the possible inability to subject foreign persons to the jurisdiction of the courts in the United States.

As a result of the situation in Venezuela, the actions of the Venezuelan government which have and continue to adversely affect our operations and the expectation that dividends from Petrodelta will be minimal over the next few years, cash generated from operations has been limited and this has had a significant adverse effect on our ability to obtain financing to acquire and develop growth opportunities elsewhere. In the consolidated financial statements issued in the prior year, we discussed certain doubts about our ability to continue as a going concern. At the time of issuance, we expected that in 2013 we would not generate revenues, we would continue to generate losses from operations, and that our cash flows would not be sufficient to cover our operating expenses. While we believed that we would be able to raise additional capital through issuances of debt and/or equity or through sales of assets, our circumstances at such time raised substantial doubt about our ability to continue to operate as a going concern, and this was disclosed in the notes to the consolidated financial statements.

As discussed above under Share Purchase Agreement, on December 16, 2013, Harvest and HNR Energia entered into the Share Purchase Agreement with Petroandina and Pluspetrol, its parent, to sell all of our 80 percent equity interest in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement, when we sold a 29 percent equity interest in Harvest Holding for $125 million. Proceeds from the December 2013 sale of the 29 percent equity interest in Harvest Holding are expected to be adequate to meet our short-term liquidity requirements. As discussed above and in Note 5 – Dispositions, Share Purchase Agreement below, on December 16, 2013, Harvest and HNR Energia entered into the Share Purchase Agreement with Petroandina and Pluspetrol to sell all of our 80 percent equity interest in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement, when we sold a 29 percent equity interest in Harvest Holding for $125 million. The second closing, for the sale of a 51 percent equity interest in Harvest Holding for a cash purchase price of $275 million, will be subject to, among other things, approval by the holders of a majority of our common stock and approval by the Ministerio del Poder Popular de Petroleo y Mineria representing the Government of Venezuela (which indirectly owns the other 60 percent interest in Petrodelta).

We used a portion of the $125 million in proceeds from the sale of the 29 percent interest in Harvest Holding that we received on December 16, 2013, to redeem all of our 11% Senior Notes due 2014. The notes were redeemed on January 11, 2014, for $80.0 million, including principal and accrued and unpaid interest. The remaining $45.0 million of the proceeds from the sale of the 29 percent interest in Harvest Holding have been or will be used to pay costs associated with the sale of our Venezuelan interests, to pay severance costs, to make capital expenditures, to pay taxes related to the sale and for general operating expenses. Those remaining proceeds will also be used to repurchase certain outstanding warrants if our stockholders approve the sale of our remaining Venezuelan interests, and if a “Fundamental Change” is consummated under the terms of those warrants.

We are currently marketing our non-Venezuelan assets and talking to potential buyers, and we intend to continue our consideration of a possible sale for some or all of our non-Venezuelan assets if we are able to negotiate a sale or sales in transactions that our Board of Directors believes are in the best interests of the Company and its stockholders. In the meantime, we intend to operate our business in the ordinary course and may ultimately decide to keep our non-Venezuelan assets and acquire additional assets.

If the proposed sale of our remaining Venezuelan interests is completed and/or the sale of other non-Venezuelan assets are completed, a significant portion of our assets will be cash from the proceeds of such transactions. However, the timing of the sale of our remaining 51 percent interest in Harvest Holding or sales of other assets is beyond our control and we will continue to have operating and capital requirements until these sales are completed. Depending on the timing of these events, we anticipate using a portion of the proceeds from the sale of 51 percent interest in Harvest Holding to pay for expenses and other costs related to the transaction, which we estimate will be approximately $4 million; to pay taxes related to the transaction, which we estimate will be approximately $51.1 million. In addition, if we do not sell our non-Venezuelan assets before the sale of the 51 percent interest in Harvest Holding, then we estimate that we will need to retain a portion of the proceeds to fund projected general operating expenses and capital expenditures. Some of these costs will be paid from funds remaining from the proceeds of the initial sale of the 29 percent interest in Harvest Holding. If we sell our non-Venezuelan assets before the sale of the remaining 51 percent interest in Harvest Holding, then our requirements for projected general operating expenses and capital expenditures would be reduced. We will also use these funds to pay any severance or other costs during 2014 associated with the possible severance of some of our personnel in connection with a downsizing of the Company both related to the sale of our Venezuelan interests and related to any sale of our non-Venezuelan assets, if our Board of Directors determines that a downsizing would be in our best interests. We estimate these costs to be approximately $20 million.

Although we are currently marketing our non-Venezuelan assets and talking to potential buyers, we intend to operate our business in the ordinary course and may ultimately decide to keep our non-Venezuelan assets and acquire additional assets. Since we no longer have any obligations under the 11% Senior Notes due 2014, and given that we do not currently have any operating cash inflows, we may also decide to access additional capital through equity or debt sales; however, there can be no assurance that such financing will be available to the Company or on terms that are acceptable to the Company.

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Debt - Additional Information (Detail) (USD $)	12 Months Ended					12 Months Ended			1 Months Ended		12 Months Ended				12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Oct. 11, 2012	Feb. 17, 2010	Dec. 31, 2013 Senior Notes [Member]	Dec. 31, 2012 Senior Notes [Member]	Dec. 31, 2011 Senior Notes [Member]	May 31, 2011 Term Loan Facility [Member]	Oct. 31, 2010 Term Loan Facility [Member]	Dec. 31, 2012 Term Loan Facility [Member]	Dec. 31, 2013 11% senior unsecured notes [Member]	Dec. 31, 2012 11% senior unsecured notes [Member]	Oct. 11, 2012 11% senior unsecured notes [Member]	Dec. 31, 2013 8.25% Senior Convertible Notes [Member]	Dec. 31, 2012 8.25% Senior Convertible Notes [Member]	Feb. 17, 2010 8.25% Senior Convertible Notes [Member]
Debt Instrument [Line Items]
Interest payment due dates	January 1, April 1, July 1 and October 1, beginning January 1, 2013														March 1 and September 1 of each year, beginning September 1, 2010
Debt instrument interest rate stated percentage				11.00%		11.00%						11.00%	11.00%			8.25%
Offering cost of senior notes												$ 79,750,000	$ 79,750,000	$ 79,800,000			$ 32,000,000
Sale of 11 percent senior unsecured notes due												Oct. 11, 2014
Percent of principal amount												96.00%
Warrants to purchase share of our common stock												800,000
Exercise price of common stock												10.00
Financing costs associated with the senior convertible notes	0	3,111,000	1,000,000									1,300,000	3,200,000
Sale of equity interest in Harvest Holding												29.00%
Cost of Sale of Equity interest												125,000,000
Notes redeemed						80,000,000						80,000,000
Loss on early extinguishment of debt	0	(5,425,000)	(13,132,000)						13,100,000			3,600,000
Write off of discount on debt									10,600,000			2,300,000
Placement fees and other transaction costs									400,000			1,300,000
Sale of assets	5,000,000
Unsecured senior notes repurchase offer period in case of specified sales proceeds of assets	30 days
Percent of the principal amount plus accrued and unpaid interest	105.50%
Percent in the case of a change in control	101.00%
Percent in the case of a sale of Petrodelta plus accrued interest	105.50%
Embedded derivative value	0
Convertible Debt equity instruments issued		4,600,000.0000	100,000.0000		175.2234
Principal amount of senior convertible notes			1,000
Debt instrument, convertible, conversion price			$ 5.71
Senior convertible notes, exchanged							25,500,000	500,000
Term loan facility prepaid	0	0	60,000,000						60,000,000	60,000,000	6,000,000
New debt received in exchange of old debt													10,500,000
Convertible debt equity instruments conversion price		$ 5.59
Deferred financing cost		600,000
Initial interest rate										10.00%
Interim interest rate										15.00%
Percentage of prepayment premium									3.50%
Debt outstanding amount on which prepayment premium paid									$ 2,100,000

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Summary of Significant Accounting Policies - Schedule Of Other Assets (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	May 31, 2011
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract]
Deferred financing costs	$ 0	$ 3,111	$ 1,000
Long-term VAT receivable	0	3,440
Long-term prepaid expenses	139	328
Gabon PSC - blocked payment (net to our 66.667% interest)	734	734		700
Other assets	$ 873	$ 7,613

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Dispositions (Tables)

12 Months Ended

Dec. 31, 2013

Discontinued Operations And Disposal Groups [Abstract]

Revenue and Net Income (Loss) on Disposition

Oman operations, Colombia operations and the Antelope Project have been classified as discontinued operations. Revenue and income (loss) are shown in the table below:

	Year Ended December 31,
	2013			2012			2011
				(in thousands)
Revenue applicable to discontinued operations:
Oman	$	0		$	0		$	0
Colombia		0			0			0
Antelope Project		0			0			6,488
	$	0		$	0		$	6,488
Income (loss) from discontinued operations:
Oman	$	(674	)	$	(12,711	)	$	(11,371	)
Colombia		(4,476	)		0			0
Antelope Project		0			(1,699	)		97,616
	$	(5,150	)	$	(14,410	)	$	86,245

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Earnings Per Share (Tables)

12 Months Ended

Dec. 31, 2013

Earnings Per Share [Abstract]

Earnings Per Share

Basic earnings per common share (“EPS”) are computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that would occur if securities or other contracts to issue common stock were exercised or converted into common stock.

	Year Ended December 31,
	2013			2012			2011
	(in thousands, except per share amounts)
Income (loss) from continuing operations(a)	$	(83,946	)	$	2,199		$	(30,285	)
Discontinued operations		(5,150	)		(14,410	)		86,245
Net income (loss) attributable to Harvest	$	(89,096	)	$	(12,211	)	$	55,960
Weighted average common shares outstanding		39,579			37,424			34,117
Effect of dilutive securities		0			167			0
Weighted average common shares, diluted		39,579			37,591			34,117
Basic Earnings (Loss) Per Share:
Income (loss) from continuing operations	$	(2.12	)	$	0.06		$	(0.89	)
Discontinued operations		(0.13	)		(0.39	)		2.53
Basic earnings (loss) per share	$	(2.25	)	$	(0.33	)	$	1.64
Diluted Earnings (Loss) Per Share:
Income (loss) from continuing operations	$	(2.12	)	$	0.06		$	(0.89	)
Income (loss) from discontinued operations		(0.13	)		(0.39	)		2.53
Diluted earnings (loss) per share	$	(2.25	)	$	(0.33	)	$	1.64

^(a)  Net of net income attributable to noncontrolling interests.

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Investment in Equity Affiliate - Petrodelta - Additional Information (Detail)	3 Months Ended								12 Months Ended						12 Months Ended	1 Months Ended		3 Months Ended	12 Months Ended				1 Months Ended			1 Months Ended
	Dec. 31, 2013 USD ($)	Sep. 30, 2013 USD ($)	Jun. 30, 2013 USD ($)	Mar. 31, 2013 USD ($)	Dec. 31, 2012 USD ($)	Sep. 30, 2012 USD ($)	Jun. 30, 2012 USD ($)	Mar. 31, 2012 USD ($)	Dec. 31, 2013 USD ($)	Dec. 31, 2012 USD ($)	Dec. 31, 2011 USD ($)	Feb. 28, 2013	Dec. 31, 2013 October 1, 2013 [Member]	Dec. 31, 2013 May 1, 2014 [Member]	Dec. 31, 2013 Venezuela [Member]	Feb. 28, 2013 Petrodelta, S.A. [Member] USD ($)	Nov. 30, 2010 Petrodelta, S.A. [Member] USD ($)	Dec. 31, 2013 Petrodelta, S.A. [Member] USD ($)	Dec. 31, 2013 Petrodelta, S.A. [Member] USD ($) Employee	Dec. 31, 2012 Petrodelta, S.A. [Member] USD ($)	Dec. 31, 2011 Petrodelta, S.A. [Member] USD ($)	Dec. 31, 2013 Petrodelta, S.A. [Member] VEB	Nov. 30, 2010 Petrodelta, S.A. [Member] HNR Finance [Member] USD ($)	Feb. 28, 2013 Petrodelta, S.A. [Member] Minimum [Member]	Feb. 28, 2013 Petrodelta, S.A. [Member] Maximum [Member]	Jan. 28, 2011 Fusion Geophysical Llc [Member] USD ($)
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Revenue																			$ 756,700,000	$ 352,700,000
No of employees seconded into Petrodelta																			3
Advance payment									531,000	414,000	682,000								500,000
Advances to Affiliate to a long-term receivable																		800,000	800,000
Contribution of extraordinary prices															80
Contribution of exorbitant prices															80
Royalty paid in-cash									3.33%										3.33%
Royalty paid in-kind									30.00%
Royalties paid									80	70									80
Reduction in royalty																			38,400,000	113,700,000	85,000,000
Reduction in royalty net to interest by parent indirectly																			12,100,000	36,400,000	27,200,000
Percentage of interest owned by parent indirectly									20.40%											32.00%	32.00%
Royalty paid in-cash in-kind									33.33%
Gain on revaluation of its assets and liabilities																169,600,000
Change in exchange currency rate												6.3						11.3	11.3					4.3	6.3
Assets account, balance																						1,011,000,000
Liabilities account, balance																						6,683,000,000
Foreign currency loss																		14,200,000
Increase in salary	90.00%								90.00%				59.00%	23.00%
Dividends common stock cash from equity method investee																	30,600,000
Dividends declared to HNR Finance																							12,200,000
Net income/loss from equity affiliate	$ (10,242,000)	$ 25,747,000	$ 7,602,000	$ 49,471,000	$ 7,745,000	$ 20,299,000	$ 22,829,000	$ 16,896,000	$ 72,578,000	$ 67,769,000	$ 73,451,000								$ 72,578,000	$ 67,769,000	$ 72,066,000					$ 1,400,000

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Summary of Significant Accounting Policies - Schedule Of Other Assets (Parenthetical) (Detail)	1 Months Ended	12 Months Ended
	May 31, 2011	Dec. 31, 2013	Dec. 31, 2012
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract]
Interest Related to Dussafu PSC Drilling Operations	66.667%	66.667%	66.667%

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Investment in Equity Affiliates (Tables)

12 Months Ended

Dec. 31, 2013

Schedule of Assets and Liabilities

	As of December 31,
	2013		2012
	(in thousands)
Financial Position under IFRS:
Current assets	$	1,906,595	$	1,425,115
Property and equipment		717,449		538,351
Other assets		181,116		70,468
Current liabilities		1,652,806		1,180,559
Other liabilities		136,298		93,101
Net equity		1,016,056		760,274

Petrodelta, S.A. [Member]

Summary of Financial Information

Summary financial information has been presented below at December 31, 2013 and 2012, and for the years ended December 31, 2013, 2012 and 2011:

	Year Ended December 31,
	2013			2012			2011
	(in thousands, except percentages)
Results under IFRS:
Revenues:
Oil sales	$	1,326,093		$	1,263,264		$	1,122,191
Gas sales		4,000			3,350			3,497
Royalty *		(440,963	)		(423,069	)		(374,135	)
		889,130			843,545			751,553
Expenses:
Operating expenses		151,661			121,023			77,236
Workovers		29,168			17,302			28,508
Depletion, depreciation and amortization		87,203			86,004			58,376
General and administrative		26,345			31,753			11,297
Windfall profits tax		234,453			291,355			237,632
Windfall profits credit		(55,168	)		0			0
		473,662			547,437			413,049
Income from operations		415,468			296,108			338,504
Gain on exchange rate		169,582			0			0
Investment earnings and other		15			13			610
Interest expense		(21,728	)		(7,017	)		(10,699	)
Income before income tax		563,337			289,104			328,415
Current income tax expense		325,217			127,080			190,577
Deferred income tax expense (benefit)		(17,662	)		76,030			(94,622	)
Net income under IFRS		255,782			85,994			232,460
Adjustments to increase (decrease) net income under IFRS:
Deferred income tax (expense) benefit		9,080			78,968			(49,545	)
Depletion expense		(20,352	)		7,282			1,908
Reversal of windfall profits tax credit		(55,168	)		0			0
Sports law over accrual		1,313			2,536			0
Net income under U.S. GAAP		190,655			174,780			184,823
Equity interest in equity affiliate		40	%		40	%		40	%
Income before amortization of excess basis in equity affiliate		76,262			69,912			73,929
Amortization of excess basis in equity affiliate		(3,684	)		(2,143	)		(1,863	)
Earnings from equity affiliate included in income	$	72,578		$	67,769		$	72,066

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Debt (Tables)

12 Months Ended

Dec. 31, 2013

Debt Disclosure [Abstract]

Summary of Debt

Debt consists of the following (in thousands):

	As of December 31,
	2013			2012
Senior notes, unsecured, with interest at 11%	$	79,750		$	79,750
Discount on 11% senior unsecured notes		(2,270	)		(4,911	)
Less current portion		(77,480	)		0
	$	0		$	74,839

Principal Payment Requirements on Long-Term Debt Outstanding

The principal payment requirements for our debt outstanding at December 31, 2013 are as follows (in thousands):

2014	$	79,750
	$	79,750

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Organization

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Organization

Note 1 – Organization

Harvest Natural Resources, Inc. (“Harvest”) is an independent energy company engaged in the acquisition, exploration, development, production and disposition of oil and natural gas properties since 1989, when it was incorporated under Delaware law.

We have acquired and developed significant interests in the Bolivarian Republic of Venezuela (“Venezuela”). Our Venezuelan interests are owned through Harvest-Vinccler Dutch Holding, B.V., a Dutch private company with limited liability (“Harvest Holding”). Our ownership of Harvest Holding is through HNR Energia, B.V. (“HNR Energia”) in which we have a direct controlling interest. Prior to December 16, 2013, we indirectly owned 80 percent of Harvest Holding and we had one partner, Oil & Gas Technology Consultants (Netherlands) Coöperatie U.A., (“Vinccler”, a controlled affiliate of Venezolana de Inversiones y Construcciones Clerico, C.A.), which owned the remaining noncontrolling interest in Harvest Holding of 20 percent. We do not have a business relationship with Vinccler outside of Venezuela. On December 16, 2013, Harvest and HNR Energia entered into a Share Purchase Agreement (“Share Purchase Agreement”) with Petroandina Resources Corporation N.V. (“Petroandina”, a wholly owned subsidiary of Pluspetrol Resources Corporation B.V. (“Pluspetrol”)) and Pluspetrol to sell all of our 80 percent equity interest in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement, when we sold a 29 percent equity interest in Harvest Holding for $125 million. This first transaction resulted in a loss on the sale of the interest in Harvest Holding of $23.0 million in the year ended December 31, 2013. As a result of this first sale, we indirectly own 51 percent of Harvest Holding beginning December 16, 2013 and the noncontrolling interest owners hold the remaining 49 percent with Petroandina having 29 percent and Vinccler continuing to own 20 percent. SeeNote 5 – Dispositions below for further information on this transaction.

Harvest Holding owns, indirectly through wholly owned subsidiaries, a 40 percent of Petrodelta, S.A. (“Petrodelta”). Corporación Venezolana del Petroleo S.A. (“CVP”) and PDVSA Social S.A. own the remaining 56 percent and 4 percent, respectively, of Petrodelta. Petroleos de Venezuela S.A. (“PDVSA”) owns 100 percent of CVP and PDVSA Social S.A. Through our indirect 51 percent in Harvest Holding, we indirectly own a net 20.4 percent interest in Petrodelta for the period from December 16, 2013 to date, and prior to December 16, 2013 we indirectly owned a 32 percent interest in Petrodelta through our indirect 80 percent interest in Harvest Holding during this period.

In addition to its 40 percent interest in Petrodelta, Harvest Holding also indirectly owns 100 percent of Harvest Vinccler S.C.A. (“Harvest Vinccler”). Harvest Vinccler’s main business purposes are to assist us in the management of Petrodelta and in negotiations with PDVSA.

In addition to our interests in Venezuela, we also have the following projects:

• Offshore of the Republic of Gabon (“Gabon”) through the Dussafu Marin Permit (“Dussafu PSC”) (see Note 8 – Gabon),

• Mainly onshore in West Sulawesi in the Republic of Indonesia (“Indonesia”) through the Budong-Budong Production Sharing Contract (“Budong PSC”) (see Note 9 – Indonesia), and

• Offshore of the People’s Republic of China (“China”) through the Wab-21 Petroleum Contract (see Note 10 – China).

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Warrant Derivative Liabilities (Tables)

12 Months Ended

Dec. 31, 2013

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Schedule of Significant Assumptions or Ranges

The assumptions summarized in the following table were used to calculate the fair value of the warrant derivative liability that was outstanding as of any of the balance sheet dates presented on our consolidated balance sheets:

	Fair Value Hierarchy Level
			As of December 31,
			2013			2012
Significant assumptions (or ranges):
Stock price		Level 1 input	$	4.52		$	9.07
Term (years)				1.83			2.83
Volatility		Level 2 input		94	%		70	%
Risk-free rate		Level 1 input		0.34	%		0.33	%
Dividend yield		Level 2 input		0.0	%		0.0	%
Scenario probability (fundamental change event/debt raise/equity raise)		Level 3 input		60%/40%/0	%		0%/80%/20	%

Income (Loss) Associated with Changes in Fair Values of Our Warrant Derivative Financial Instruments

The following table summarizes the effect on our income (loss) associated with changes in the fair values of our warrant derivative financial instruments:

	Year Ended December 31,
	2013		2012
	(in thousands)
Unrealized gain (loss) on warrant derivatives	$	3,517	$	(600	)

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Stock-Based Compensation and Stock Purchase Plans - Restricted Stock - Additional Information (Detail) (Restricted Stock [Member], USD $) In Millions, except Share data, unless otherwise specified	12 Months Ended			0 Months Ended	12 Months Ended	0 Months Ended	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Jul. 13, 2013 Director [Member]	Dec. 31, 2013 Director [Member]	Jul. 13, 2013 Employee [Member]	Dec. 31, 2013 Employee [Member]	Dec. 31, 2012 Newly Hired Employees [Member]	Dec. 31, 2011 Newly Hired Employees [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Option vesting period					1 year		3 years
Granted, Shares	190,002	0	179,050	100,002		90,000		2,000	2,000
Aggregate fair value of awards	$ 0.90	$ 0.01	$ 2.00
Value of the restricted stock vested	1.2	0.8	3.4
Granted, Weighted-Average Grant - Date Fair Value	$ 4.80	$ 5.85	$ 11.21
Unrecognized compensation cost	$ 0.8
Expected weighted average period of recognizing compensation cost	1 year 4 months 24 days

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Summary of Significant Accounting Policies - Additional Information (Detail) (USD $)	1 Months Ended	12 Months Ended
	May 31, 2011	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Summary Of Significant Accounting Policies [Line Items]
Maximum maturity period of cash equivalents		3 months
Depletion expense on oil and gas properties		$ 0	$ 0	$ 0
Dry hole costs		0	685,000	40,003,000
Proved oil and gas properties		0	0	0
Depreciation Expense		341,000	391,000	439,000
Blocked payment net to cost sharing interest	700,000	734,000	734,000
Interest Related to Dussafu PSC Drilling Operations	66.667%	66.667%	66.667%
Capitalized interest costs		8,300,000	3,000,000	2,300,000
Term loan facility		60,000,000
Transfers of liabilities		0
Furniture, fixtures and equipment [Member]
Summary Of Significant Accounting Policies [Line Items]
Depreciation Expense		300,000	400,000	400,000
Furniture, fixtures and equipment [Member] | Minimum [Member]
Summary Of Significant Accounting Policies [Line Items]
Estimated Useful Life		3 years
Furniture, fixtures and equipment [Member] | Maximum [Member]
Summary Of Significant Accounting Policies [Line Items]
Estimated Useful Life		5 years
Budong PSC [Member]
Summary Of Significant Accounting Policies [Line Items]
Impaired expense		600,000
Budong PSC [Member] | KD-1 and KD-1ST [Member]
Summary Of Significant Accounting Policies [Line Items]
Dry hole costs		0	700,000
Colombia [Member]
Summary Of Significant Accounting Policies [Line Items]
Impaired expense		3,200,000
Block 64 EPSA [Member]
Summary Of Significant Accounting Policies [Line Items]
Impaired carrying value			6,400,000
WAB-21 [Member]
Summary Of Significant Accounting Policies [Line Items]
Impaired carrying value			2,900,000
West Bay [Member]
Summary Of Significant Accounting Policies [Line Items]
Impaired carrying value				3,300,000
Petroandina [Member]
Summary Of Significant Accounting Policies [Line Items]
Percentage of interest owned		29.00%
Harvest Vinccler S.C.A. [Member]
Summary Of Significant Accounting Policies [Line Items]
Percentage of interest owned		20.00%
Other Assets [Member]
Summary Of Significant Accounting Policies [Line Items]
Valuation allowances charged to general and administrative expenses		2,800,000
Blocked payment net to cost sharing interest		700,000	700,000
Other Assets [Member] | Minimum [Member]
Summary Of Significant Accounting Policies [Line Items]
Prepaid expenses expected to realized during period		12 months
Other Assets [Member] | Maximum [Member]
Summary Of Significant Accounting Policies [Line Items]
Prepaid expenses expected to realized during period		24 months
Derivative Liabilities [Member]
Summary Of Significant Accounting Policies [Line Items]
Unrealized change in fair value		$ 3,500,000	$ 600,000	$ 9,800,000

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Investment in Equity Affiliate - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	12 Months Ended		1 Months Ended	12 Months Ended					12 Months Ended		0 Months Ended	12 Months Ended
	Dec. 31, 2013	Dec. 16, 2013 Closings	Mar. 31, 2013 Petrodelta, S.A. [Member]	Dec. 31, 2013 Petrodelta, S.A. [Member]	Dec. 31, 2012 Petrodelta, S.A. [Member]	Dec. 31, 2011 Petrodelta, S.A. [Member]	Dec. 31, 2013 Harvest Holding [Member] Closings	Dec. 16, 2013 Harvest Holding [Member]	Dec. 31, 2013 Harvest Holding [Member] First Closing [Member]	Dec. 16, 2013 Harvest Holding [Member] First Closing [Member]	Dec. 31, 2013 Harvest Holding [Member] Petrodelta, S.A. [Member]	Dec. 16, 2013 Harvest Holding [Member] Petrodelta, S.A. [Member]	Dec. 31, 2013 Harvest Holding [Member] Petrodelta, S.A. [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Equity interest in equity affiliate				40.00%	40.00%	40.00%
Percentage of equity interest to sell as per agreement								80.00%		29.00%
Number of closings for sale of Shares		2					2
Cash purchase price for share purchase agreement								$ 400		$ 125
Loss on Sale of Interest in Harvest holding									23.0
Exemption credit			55.2
Exemption credit, net of tax			36.4
Overstatement of Sports Law contribution	1.3
Overstatement of Sports Law contribution net to interest by parent indirectly	$ 0.3
Percentage of interest owned by parent indirectly	20.40%				32.00%	32.00%					20.40%	32.00%	51.00%
Hydrocarbon contract term	20 years
Participation required for decision making process				75.00%
Contract Price per MCF of gas				1.54
Collection period for obligated to make payment to Petrodelta				60 days

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Taxes - Provision (Benefit) for Income Taxes on Continuing Operations (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended								12 Months Ended
	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Current:
United States									$ 2,279	$ (717)
Foreign									44	929	3,693
Total									2,323	212	3,693
Deferred:
United States									72,971	(22)
Foreign									(2,207)	(799)	(2,636)
Total									70,764	(821)	(2,636)
Total income tax expense - continuing operations	$ (75,228)	$ 765	$ 1,415	$ (39)	$ 90	$ (1,723)	$ 1,022	$ 1,220	$ 73,087	$ (609)	$ 1,057

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CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
CURRENT ASSETS:
Cash and cash equivalents	$ 120,897	$ 72,627
Restricted cash	148	1,000
Accounts receivable, net	1,962	2,955
Advances to and receivables from equity affiliate	0	656
Deferred income taxes	81	821
Prepaid expenses and other	2,030	1,460
TOTAL CURRENT ASSETS	125,118	79,519
LONG-TERM RECEIVABLE - EQUITY AFFILIATE	15,097	14,346
INVESTMENT IN EQUITY AFFILIATE	485,401	412,823
PROPERTY AND EQUIPMENT:
Oil and gas properties (successful efforts method)	108,013	81,792
Other administrative property, net	378	744
TOTAL PROPERTY AND EQUIPMENT, NET	108,391	82,536
OTHER ASSETS	873	7,613
TOTAL ASSETS	734,880	596,837
CURRENT LIABILITIES:
Accounts payable, trade and other	4,398	3,970
Accrued expenses	22,659	30,748
Accrued interest	380	624
Income taxes payable	2,178	102
Current deferred tax liability	43,162	0
Current portion - long term debt	77,480	0
Note payable to noncontrolling interest owner	6,109	0
Other current liabilities	419	3,538
TOTAL CURRENT LIABILITIES	156,785	38,982
LONG - TERM DEBT	0	74,839
WARRANT DERIVATIVE LIABILITY	1,953	5,470
LONG-TERM DEFERRED TAX LIABILITY	29,787	0
OTHER LONG - TERM LIABILITIES	558	1,108
COMMITMENTS AND CONTINGENCIES (See Note 13)
STOCKHOLDERS' EQUITY:
Preferred stock, par value $0.01 a share; authorized 5,000 shares; outstanding, none	0	0
Common stock, par value $0.01 a share; authorized 80,000 shares at December 31, 2013 and 2012; issued 48,666 and 45,882 shares at December 31, 2013 and 2012, respectively	487	458
Additional paid-in capital	276,083	263,646
Retained earnings	92,282	181,378
Treasury stock, at cost, 6,551 shares at December 31, 2013 and (2012: 6,527 shares)	(66,222)	(66,145)
TOTAL HARVEST STOCKHOLDERS' EQUITY	302,630	379,337
NONCONTROLLING INTERESTS	243,167	97,101
TOTAL EQUITY	545,797	476,438
TOTAL LIABILITIES AND EQUITY	$ 734,880	$ 596,837

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Summary of Significant Accounting Policies - Summary of Estimated Fair Values of Fixed Interest Rate, Long-term Debt Instrument (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013
Fair Value Of Assets And Liabilities Measured On Non Recurring Basis [Line Items]
11% senior unsecured notes carrying value (Level 2)	$ 79,750
Level 2 input [Member]
Fair Value Of Assets And Liabilities Measured On Non Recurring Basis [Line Items]
11% senior unsecured notes carrying value (Level 2)	77,480
11% senior unsecured notes at fair value (Level 2)	$ 79,750

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical)	Dec. 31, 2012	Dec. 31, 2011
Percentage of senior convertible notes	8.25%	8.25%
Common Stock [Member]
Percentage of senior convertible notes	8.25%	8.25%
Additional Paid-in Capital [Member]
Percentage of senior convertible notes	8.25%	8.25%

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Related Party Transactions - Additional Information (Detail) (USD $) In Millions, except Share data, unless otherwise specified	0 Months Ended			1 Months Ended		0 Months Ended
	Dec. 12, 2013	Dec. 31, 2013	Dec. 31, 2012	Nov. 30, 2013 Private Placement [Member] Private_placement	Nov. 30, 2013 Officers And Directors [Member] Officers	Dec. 12, 2013 Harvest Vinccler S.C.A. [Member] Hnr Energia [Member]	Dec. 12, 2013 London Interbank Offered Rate (LIBOR) [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Sale of common stock		48,666,000	45,882,000	1,704,800	246,000
Proceeds from sale of stock				$ 5.40	$ 0.80
Common stock sales price		$ 0.01	$ 0.01	$ 3.15	$ 3.15
Number of private placement transactions				12
Number of officers					6
Amount of notes payable to related party						10.4
Amount of notes, paid						4.3
Notes payable amount, outstanding	$ 6.1
Interest rate on notes payable	0.50%
Notes payable maturity date							Jun. 30, 2016

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Indonesia - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 acre	Dec. 31, 2012	Jan. 31, 2011	Jan. 14, 2011	Sep. 15, 2010	Dec. 31, 2007
Projects with Exploratory Well Costs Capitalized for More than One Year [Line Items]
Farmout agreement to acquire interest	7.10%
Extended period of initial exploration phase	4 years
Number of wells under operational activities	2
Budong PSC [Member]
Projects with Exploratory Well Costs Capitalized for More than One Year [Line Items]
Farmout agreement to acquire interest			64.40%		54.40%	47.00%
Committing to fund the fist phase cap						$ 17.2
Maximum level of carried interest						20.0
Increase in funding obligation due to option exercise					2.7
Cost of funding to acquire interest in acquiree					19.9
Acquire additional equity, first acquisition					7.40%
Acquire additional equity, second acquisition				10.00%
Cost of additional interest acquisition				3.7
Period available related to acquisition cost payable	10 days
Cost sharing interest			64.51%
Expiration date of contract	Jan. 15, 2013	Jan. 16, 2013
Extended period of initial exploration phase	4 years
Initial exploration phase	6 years
Acquired additional participating interest, third acquisition		7.10%
Participating ownership interest		71.50%
Participating ownership interest until first commercial production		72.00%
Percentage funded consideration for transaction		100.00%
Duration exploration not drilled		18 months
Consideration paid		3.2
Area covered during initial exploration period	1.35
Exploration period	10 years
Development phase period	20 years
Initial exploration phase	3 years
Original area relinquished to SKK Migas	45.00%
Original area relinquished	35.00%
Relinquishment deferred	10.00%
Budong PSC covered	750,000
Current percentage of original contract area	55.00%
Reduced percentage of original contract area	20.00%
Area remained covered under initial contract	300,000
Impaired expense	0.6
Oil and gas properties	4.6	5.3
Valuation allowance expect to recover	$ 2.8
Budong PSC [Member] | Lariang Basin [Member]
Projects with Exploratory Well Costs Capitalized for More than One Year [Line Items]
Number of leads used while remapping of Basin	8
Budong PSC [Member] | Karama Basin [Member]
Projects with Exploratory Well Costs Capitalized for More than One Year [Line Items]
Number of leads used while remapping of Basin	5

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Stock-Based Compensation and Stock Purchase Plans (Tables)

12 Months Ended

Dec. 31, 2013

Summary of the Status of Stock Option Plans

Stock option transactions under our various stock-based employee compensation plans are presented below:

Options	Shares			Weighted- Average Exercise Price			Weighted- Average Remaining Contractual Term		Aggregate Intrinsic Value
	(in thousands, except exercise price)
Options outstanding as of December 31, 2012		3,897		$	9.62			2.6 years	$	3,064
Granted		920			4.80
Exercised		(20	)		(6.10	)
Cancelled		(64	)		(6.74	)
Options outstanding as of December 31, 2013		4,733		$	8.74			2.1 years	$	0
Options exercisable as of December 31, 2013		2,905		$	9.85			1.3 years	$	0

Summary of Value of Option Grant Estimated on the Date of Grant

The value of each stock option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:

	Year Ended December 31,
	2013			2012			2011
For options granted during:
Weighted average fair value	$	3.06		$	2.85		$	5.92
Weighted average expected life		5 years			5 years			5 years
Expected volatility (1)		79.4	%		67.3	%		61.3	%
Risk-free interest rate		1.3	%		0.7	%		1.8	%
Dividend yield		0.0	%		0.0	%		0.0	%

⁽¹⁾  Expected volatilities are based on historical volatilities of our stock.

SAR Award Transactions Under Stock-Based Employee Compensation Plans

SAR award transactions under our employee compensation plans are presented below:

Stock Appreciation Rights	SARs			Weighted- Average Exercise Price			Weighted- Average Remaining Contractual Term		Aggregate Intrinsic Value
									(in thousands)
SARs outstanding as of December 31, 2012		932,202		$	4.99
Granted		213,996			4.80
Exercised		0
Cancelled		(19,000	)		(5.12	)
SARs outstanding as of December 31, 2013		1,127,198		$	4.95			3.26 years	$	0
SARs exercisable as of December 31, 2013		394,394		$	4.91			2.84 years	$	0

Summary of Dates the Warrants Were Issued, the Expiration Dates, the Exercise Prices and the Number of Warrants Issued and Outstanding

The dates the warrants were issued, the expiration dates, the exercise prices and the number of warrants issued and outstanding at December 31, 2013 were:

				Warrants
Date Issued	Expiration Date	Exercise Price		Issued		Outstanding
				(in thousands)
November 2010	November 2015	$	12.95		1,600		1,600
October 2011	November 2015		12.95		2		2
March 2012	November 2015		12.95		73		73
August 2012	November 2015		12.95		30		30
October 2012	November 2015		12.95		15		15
July 2013	November 2015		12.95		29		29
October 2013	November 2015		12.95		22		22
November 2013	November 2015		12.95		55		55
October 2012	October 2015		10.00		687		687
					2,513		2,513

Options [Member]

Summary of Unvested Awards

A summary of our unvested stock option awards as of December 31, 2013, and the changes during the year then ended is presented below:

Unvested Stock Options	Outstanding			Weighted- Average Grant-Date Fair Value
	(in thousands, except per share amount)
Unvested as of December 31, 2012		1,380		$	4.88
Granted		920			3.06
Vested		(452	)		(4.27	)
Forfeited		(20	)		(3.04	)
Unvested as of December 31, 2013		1,828			4.14

Restricted Stock [Member]

Summary of Unvested Awards

A summary of our restricted stock awards as of December 31, 2013, and the changes during the year then ended is presented below:

Restricted Stock	Outstanding			Weighted Average Grant-Date Fair Value
Unvested as of December 31, 2012		284,750		$	8.93
Granted		190,002			4.80
Vested		(160,600	)		(7.23	)
Forfeited		0
Unvested as of December 31, 2013		314,152			7.30

Unvested Stock Appreciation Rights [Member]

Summary of Unvested Awards

A summary of our unvested SAR awards as of December 31, 2013, and the changes during the year then ended is presented below:

Unvested Stock Appreciation Rights	Outstanding			Weighted- Average Fair Value
Unvested as of December 31, 2012		857,205		$	6.18
Granted		213,996			2.73
Vested		(323,063	)		(2.46	)
Forfeited		(15,334	)		(2.47	)
Unvested as of December 31, 2013		732,804			2.54

Restricted Stock Units (RSUs) [Member]

Summary of Unvested Awards

A summary of our RSU awards as of December 31, 2013, and the changes during the year then ended is presented below:

Restricted Stock Units	Outstanding			Weighted- Average Fair Value
Unvested as of December 31, 2012		530,006		$	9.07
Granted		0
Vested		(202,668	)		(4.12	)
Forfeited		(5,000	)		(4.52	)
Unvested as of December 31, 2013		322,338			4.52

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Warrant Derivative Liabilities - Schedule of Significant Assumptions or Ranges (Detail) (Warrants derivative liabilities [Member], USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Significant assumptions (or ranges):
Term (years)	1 year 9 months 29 days	2 years 9 months 29 days
Level 1 input [Member]
Significant assumptions (or ranges):
Stock price	$ 4.52	$ 9.07
Risk-free rate	0.34%	0.33%
Level 2 input [Member]
Significant assumptions (or ranges):
Volatility	94.00%	70.00%
Dividend yield	0.00%	0.00%
Level 3 input [Member]
Significant assumptions (or ranges):
Scenario probability (fundamental change event/debt raise/equity raise)	60%/40%/0 %	0%/80%/20 %

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Stock-Based Compensation and Stock Purchase Plans

12 Months Ended

Dec. 31, 2013

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-Based Compensation and Stock Purchase Plans

Note 15 – Stock-Based Compensation and Stock Purchase Plans

Total share-based compensation expense, which includes stock options, restricted stock, stock appreciation rights (“SARs”), and restricted stock units (“RSUs”), totaled $2.3 million for the year ended December 31, 2013 ($5.2 million and $4.8 million for the years ended December 31, 2012 and 2011, respectively). All awards utilize the straight line method of amortization over vesting terms. RSUs and SARs can be cash settled and are accounted for as liability instruments.

The cash flows resulting from tax deductions in excess of the compensation cost recognized for share-based awards (excess tax benefits) are classified as financing cash flows. The actual tax benefit realized from share-based awards during the year ended December 31, 2011 was $2.5 million. We did not realize tax benefits from share-based awards during the years ended December 31, 2013 or 2012.

Long Term Incentive Plans

As of December 31, 2013, we had several long term incentive plans under which stock options, restricted stock, SARs and RSUs can be granted to eligible participants including employees, non-employee directors and consultants of our Company or subsidiaries:

• 2010 Long Term Incentive Plan, as amended (“2010 Plan”) – Provides for the issuance of up to 2,725,000 shares of our common stock in satisfaction of stock options, SARs, restricted stock, RSUs and other stock-based awards. No more than 700,000 shares may be granted as restricted stock and no individual may be granted more than 1,000,000 stock options or SARs. The 2010 Plan also permits the granting of performance awards to eligible employees and consultants. In the event of a change in control, all outstanding stock options and SARs become immediately exercisable to the extent permitted by the plan, and any restrictions on restricted stock and RSUs lapse.

• 2006 Long Term Incentive Plan (“2006 Plan”) – Provides for the issuance of up to 1,825,000 shares of our common stock in satisfaction of stock options, SARs and restricted stock. No more than 325,000 shares may be granted as restricted stock, and no individual may be granted more than 900,000 stock options or SARs and not more than 175,000 shares of restricted stock during any period of three consecutive calendar years. The 2006 Plan also permits the granting of performance awards to eligible employees and consultants. In the event of a change in control, all outstanding stock options and SARs become immediately exercisable to the extent permitted by the plan, and any restrictions on restricted stock lapse.

• 2004 Long Term Incentive Plan (“2004 Plan”) – Provides for the issuance of up to 1,750,000 shares of our common stock in satisfaction of stock options, SARs and restricted stock. No more than 438,000 shares may be granted as restricted stock, and no individual may be granted more than 438,000 stock options and not more than 110,000 shares of restricted stock over the life of the plan. The 2004 Plan also permits the granting of performance awards to eligible employees and consultants. In the event of a change in control, all outstanding stock options and SARs become immediately exercisable to the extent permitted by the plan, and any restrictions on restricted stock lapse.

• 2001 Long Term Stock Incentive Plan (“2001 Plan”) – Provides for the issuance of up to 1,697,000 shares of our common stock in the form of Incentive Stock Options and Non-Qualified Stock Options. No officer may be granted more than 500,000 stock options during any one fiscal year, as adjusted for any changes in capitalization, such as stock splits. In the event of a change in control, all outstanding options become immediately exercisable to the extent permitted by the plan.

Stock Options

Stock options granted under the plans must be no less than the fair market value of our common stock on the date of grant. Stock options granted under the plans generally are exercisable in varying cumulative periodic installments after one year. Stock options granted under the plans expire five to ten years from the date of grant. Stock options to purchase 52,333 common shares remained available for grant as of December 31, 2013 (85,006 as of December 31, 2012).

The fair value of each stock option award is estimated on the date of grant using the Black-Scholes option-pricing model which uses assumptions for the risk-free interest rate, volatility, dividend yield and the expected term of the options. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for a period equal to the expected term of the option. Expected volatility is based on historical volatilities of our stock. We do not assume any dividend yield since we do not pay dividends. The expected term of options granted is the weighted average life of stock options and represents the period of time that options are expected to be outstanding.

We also consider an estimated forfeiture rate for these stock option awards, and we recognize compensation cost only for those shares that are expected to vest, on a straight-line basis over the requisite service period of the award, which is generally the vesting term of three years. The forfeiture rate is based on historical experience.

Stock option transactions under our various stock-based employee compensation plans are presented below:

Options	Shares			Weighted- Average Exercise Price			Weighted- Average Remaining Contractual Term		Aggregate Intrinsic Value
	(in thousands, except exercise price)
Options outstanding as of December 31, 2012		3,897		$	9.62			2.6 years	$	3,064
Granted		920			4.80
Exercised		(20	)		(6.10	)
Cancelled		(64	)		(6.74	)
Options outstanding as of December 31, 2013		4,733		$	8.74			2.1 years	$	0
Options exercisable as of December 31, 2013		2,905		$	9.85			1.3 years	$	0

Of the options outstanding, 2.9 million were exercisable at weighted-average exercise price of 9.85 as of December 31, 2013 (2.5 million at $10.12 at December 31, 2012; 2.2 million at $10.15 at December 31, 2011).

During the year ended December 31, 2013, we awarded stock options vesting over three years to purchase 920,004 of our common shares to our employees and executive officers (451,298 and 498,500 stock options during the years ended December 31, 2012 and 2011, respectively).

The value of each stock option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:

	Year Ended December 31,
	2013			2012			2011
For options granted during:
Weighted average fair value	$	3.06		$	2.85		$	5.92
Weighted average expected life		5 years			5 years			5 years
Expected volatility (1)		79.4	%		67.3	%		61.3	%
Risk-free interest rate		1.3	%		0.7	%		1.8	%
Dividend yield		0.0	%		0.0	%		0.0	%

⁽¹⁾  Expected volatilities are based on historical volatilities of our stock.

A summary of our unvested stock option awards as of December 31, 2013, and the changes during the year then ended is presented below:

Unvested Stock Options	Outstanding			Weighted- Average Grant-Date Fair Value
	(in thousands, except per share amount)
Unvested as of December 31, 2012		1,380		$	4.88
Granted		920			3.06
Vested		(452	)		(4.27	)
Forfeited		(20	)		(3.04	)
Unvested as of December 31, 2013		1,828			4.14

In September 2005, we issued 225,000 options at an exercise price of $10.91, and 165,000 options at an exercise price of $10.80, both from the 2004 Plan. From the 2001 Plan, we issued 85,000 options at an exercise price of $10.80. These grants all contained performance requirements. The performance requirements state that the average closing price of the Company’s common stock must equal or exceed $20 per share for ten consecutive trading days for these options to vest. These options are included as unvested options in the tables above.

The total intrinsic value of stock options exercised during the year ended December 31, 2013 was $0.1 million (2012: $0.3 million; 2011: $1.4 million). The total fair value of stock options that vested during the year ended December 31, 2013, was $1.9 million ($1.9 million and $2.7 million during the years ended December 31, 2012 and 2011, respectively).

As of December 31, 2013, there was $3.1 million of total future compensation cost related to unvested stock option awards that are expected to vest. That cost is expected to be recognized over a weighted average period of 2.1 years.

Restricted Stock

Restricted stock is issued on the grant date, but cannot be sold or transferred. Restricted stock granted to directors vest one year after date of grant. Restricted stock granted to employees vest at the third year after date of grant. Vesting of the restricted stock is dependent upon the employee’s continued service to Harvest.

A summary of our restricted stock awards as of December 31, 2013, and the changes during the year then ended is presented below:

Restricted Stock	Outstanding			Weighted Average Grant-Date Fair Value
Unvested as of December 31, 2012		284,750		$	8.93
Granted		190,002			4.80
Vested		(160,600	)		(7.23	)
Forfeited		0
Unvested as of December 31, 2013		314,152			7.30

On July 18, 2013, we awarded 100,002 shares of restricted stock to directors and 90,000 shares to employees as long-term incentives (0 and 179,050 shares during the years ended December 31, 2012 and 2011, respectively). In each of the years 2012 and 2011, we awarded 2,000 shares to new hire employees as employment inducement grants under a New York Stock Exchange (“NYSE”) exception (there were no such awards during the year ended December 31, 2013). The restricted stock issued in 2013 had an aggregate fair value at the date of grant of $0.9 million ($0.01 million and $2.0 million during the years ended December 31, 2012 and 2011, respectively). The restricted stock is scheduled to vest at the third year after date of grant for employees and one year after date of grant for directors. The value of the restricted stock that vested during the year ended December 31, 2013 was $1.2 million ($0.8 million and $3.4 million during the years ended December 31, 2012 and 2011, respectively). The weighted average grant date fair value of awards granted in 2012 was $5.85 and in 2011 it was $11.21.

As of December 31, 2013 there was $0.8 million of total future compensation cost related to unvested restricted stock awards that are expected to vest. That cost is expected to be recognized over a weighted average period of 1.4 years.

Stock Appreciation Rights (“SARs”)

All SAR awards granted to date have been granted outside of active long-term incentive plans and are held by Harvest employees. SARs granted in 2009 vest ratably over three years beginning with the third year of grant. SARs granted in 2012 vest ratably over three years beginning in the first year of grant. Vesting of SARs is dependent upon the employee’s continued service to Harvest. SAR awards are settled either in cash or Harvest common stock if available through an equity compensation plan. For recording of compensation, we assume the SAR award will be cash-settled and record compensation expense based on the fair value of the SAR awards at the end of each period.

SAR award transactions under our employee compensation plans are presented below:

Stock Appreciation Rights	SARs			Weighted- Average Exercise Price			Weighted- Average Remaining Contractual Term		Aggregate Intrinsic Value
									(in thousands)
SARs outstanding as of December 31, 2012		932,202		$	4.99
Granted		213,996			4.80
Exercised		0
Cancelled		(19,000	)		(5.12	)
SARs outstanding as of December 31, 2013		1,127,198		$	4.95			3.26 years	$	0
SARs exercisable as of December 31, 2013		394,394		$	4.91			2.84 years	$	0

Of the SAR awards outstanding, 74,997 were exercisable at weighted-average exercise price of $4.60 as of December 31, 2012 and 83,000 were exercisable at weighted-average exercise price of $4.60 at December 31, 2011.

During the year ended December 31, 2013, we awarded 213,996 SARs vesting over three years to our employees and executive officers (707,202 and 0 during the years ended December 31, 2012 and 2011, respectively).

The value of each SAR award is estimated on the date of grant using the Black-Scholes option pricing model using the assumptions discussed above.

A summary of our unvested SAR awards as of December 31, 2013, and the changes during the year then ended is presented below:

Unvested Stock Appreciation Rights	Outstanding			Weighted- Average Fair Value
Unvested as of December 31, 2012		857,205		$	6.18
Granted		213,996			2.73
Vested		(323,063	)		(2.46	)
Forfeited		(15,334	)		(2.47	)
Unvested as of December 31, 2013		732,804			2.54

No SAR awards were exercised during the years ended December 2013 and 2011. The total intrinsic value of SAR awards exercised during the year ended December 31, 2012 was $0.3 million. The total fair value of SAR awards that vested during the year ended December 31, 2013, was $0.8 million ($0.3 million and $0.2 million during the years ended December 31, 2012 and 2011, respectively).

In September 2005, we issued 250,000 stock units with performance requirements at an exercise price of $10.80. The performance requirements are that the average closing price of the Company’s common stock must equal or exceed $25 per share for ten consecutive trading days for these stock units to vest. Upon vesting and exercise, the holder is entitled to 100 percent of the fair market value of the Company’s common stock on exercise date less the exercise price of $10.80. The settlement of these stock units would be a cash payment. These stock units are in addition to the units reflected in the tables above.

As of December 31, 2013, there was $1.2 million of total future compensation cost related to unvested SAR awards that are expected to vest. That cost is expected to be recognized over a weighted average period of 1.8 years.

Restricted Stock Units (“RSUs”)

All RSU awards granted to date have been granted outside of active long-term incentive plans, are held by Harvest employees and directors, and are settled either in cash or Harvest common stock if available through an equity compensation plan. RSU awards granted in 2009 vest ratably over three years beginning with the third year of grant. RSU awards granted in 2012 to employees vest at the third year after date of grant. RSU awards granted in 2012 to directors vest one year after date of grant. Vesting of the RSU awards is dependent upon the employee’s and director’s continued service to Harvest.

A summary of our RSU awards as of December 31, 2013, and the changes during the year then ended is presented below:

Restricted Stock Units	Outstanding			Weighted- Average Fair Value
Unvested as of December 31, 2012		530,006		$	9.07
Granted		0
Vested		(202,668	)		(4.12	)
Forfeited		(5,000	)		(4.52	)
Unvested as of December 31, 2013		322,338			4.52

During 2012, we awarded 388,000 RSU awards to employees and directors (none during 2011). The RSU awards issued in 2012 had an aggregate fair value at their date of grant of $2.0 million. The 202,668 RSU awards which vested in 2013 were settled in cash. The value of the RSU awards that vested during the year ended December 31, 2013 was $0.8 million ($0.4 million and $0.6 million during the years ended December 31, 2012 and 2011, respectively).

As of December 31, 2013 there was $0.5 million of total future compensation cost related to unvested RSU awards expected to vest. That cost is expected to be recognized over a weighted average period of 1.3 years.

Common Stock Warrants

In connection with a $60 million term loan facility issued in November 2010, we issued (1) 1.2 million warrants exercisable at any time on or after the closing date of the term loan facility for a period of five years from the closing date on a cashless exercise basis at $15 per share until July 28, 2011, the Bridge Date, at which time the exercise price per share would be repriced to equal the lower of $15 or 120 percent of the average closing bid price of Harvest’s common stock for the 20 trading days immediately preceding the Bridge Date (“Tranche A”); (2) 0.4 million warrants exercisable at any time on or after the closing date of the term loan facility for a period of five years from the closing date on a cashless exercise basis at $20 per share until the Bridge Date, at which time the exercise price per share would be repriced to equal the lower of $15 or 120 percent of the average closing bid price of Harvest’s common stock for the 20 trading days immediately preceding the Bridge Date (“Tranche B”); and (3) 4.4 million warrants exercisable at any time on or after the Bridge Date for a period of five years from the Bridge Date on a cashless exercise basis at the lower of $15 per share or 120 percent of the average closing price of Harvest’s common stock for the 20 trading days immediately preceding the Bridge Date (“Tranche C”) (“collectively “the Warrants”). Tranche C was redeemable by Harvest for $0.01 per share at any time prior to the Bridge Date in conjunction with the repayment of the loan prior to the Bridge Date.

On May 17, 2011, in connection with the payment of the term loan facility, we redeemed all of Tranche C at $0.01 per share. The cost to redeem Tranche C ($44,000) was expensed to loss on extinguishment of debt in the six months ended June 30, 2011.

On July 28, 2011, the Bridge Date, Tranche A and Tranche B were repriced to $14.78 per warrant which is the lower of $15 or 120 percent of the average closing bid price of Harvest’s common stock for the 20 trading days immediately preceding the Bridge Date.

The Warrants include anti-dilution provisions which adjust the number of warrants and the exercise price per warrant based on the issuance of additional shares. Under the anti-dilution provision, 105,667 additional warrants were issued in the year ended December 31, 2013 (118,327 and 2,007 additional warrants during the years ended December 31, 2012 and 2011, respectively). In addition, the exercise price per share for all Warrants was repriced to $12.95 per warrant. The Warrants are classified as a liability on our consolidated balance sheets and marked to market.

If a fundamental change occurs, we are required to repurchase the Warrants at the higher of (1) the fair market value of the warrant and (2) a valuation based on a computation of the option value of the Warrant using the Black-Scholes calculation method using the assumptions described in the Warrant Agreement. A fundamental change is defined as “the occurrence of one of the following events: a) a person or group becomes the direct or indirect owner of more than 50% of the voting power of the outstanding common stock, b) a merger event or similar transaction in which the majority owners before the transaction fail to own a majority of the voting power of the Company after the transaction, and c) approval of a plan of liquidation or dissolution of the Company or sale of all or substantially all of the Company’s assets.” The completion of the second closing sale to Petroandina, assuming no prior fundamental change event, would result in a fundamental change event requiring the repurchase of the Warrants. See Note 12 – Warrant Derivative Liabilities for the impact on the valuation of the warrant derivative liabilities.

In connection with the 11 percent senior unsecured notes issued October 11, 2012, we issued warrants to purchase up to 0.7 million share of our common stock with an exercise price of $10.00 per share. The warrants can be exercised at any time up until the three-year anniversary of the closing. The Black-Scholes option pricing model was used in pricing the warrants. On the date of issuance in the year ended December 31, 2012, we recorded a credit to additional paid in capital of $2.8 million for the fair value of the warrants with a corresponding discount on debt on our consolidated balance sheet.

The dates the warrants were issued, the expiration dates, the exercise prices and the number of warrants issued and outstanding at December 31, 2013 were:

				Warrants
Date Issued	Expiration Date	Exercise Price		Issued		Outstanding
				(in thousands)
November 2010	November 2015	$	12.95		1,600		1,600
October 2011	November 2015		12.95		2		2
March 2012	November 2015		12.95		73		73
August 2012	November 2015		12.95		30		30
October 2012	November 2015		12.95		15		15
July 2013	November 2015		12.95		29		29
October 2013	November 2015		12.95		22		22
November 2013	November 2015		12.95		55		55
October 2012	October 2015		10.00		687		687
					2,513		2,513

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Operating Segments (Tables)

12 Months Ended

Dec. 31, 2013

Segment Reporting [Abstract]

Segment Income (Loss) Attributable to Harvest

	Year Ended December 31,
	2013			2012			2011
				(in thousands)
Segment Income (Loss) Attributable to Harvest
Venezuela	$	58,640		$	51,584		$	54,974
Gabon		(12,908	)		(2,902	)		(6,158	)
Indonesia		(9,213	)		(4,052	)		(45,416	)
United States		(120,465	)		(42,431	)		(33,685	)
Income (loss) from continuing operations (a)		(83,946	)		2,199			(30,285	)
Discontinued operations		(5,150	)		(14,410	)		86,245
Net income (loss) attributable to Harvest	$	(89,096	)	$	(12,211	)	$	55,960

^(a)  Net of net income attributable to noncontrolling interest.

Operating Segment Assets

	As of December 31,
	2013		2012
	(in thousands)
Operating Segment Assets
Venezuela	$	500,946	$	428,992
Gabon		107,851		80,908
Indonesia		5,004		9,587
United States		121,050		77,037
		734,851		596,524
Discontinued operations		29		313
Total Assets	$	734,880	$	596,837

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Related Party Transactions

12 Months Ended

Dec. 31, 2013

Related Party Transactions [Abstract]

Related Party Transactions

Note 17 – Related Party Transactions

In November 2013, the Company sold 1,704,800 shares of its common stock in private placements to twelve purchasers for a price of $3.15 per share resulting in $5.4 million of proceeds from the sale. 246,000 shares of common stock sold in these transactions were sold to six officers and directors of the Company for the same purchase price of $3.15 per share or a total of $0.8 million.

On December 12, 2013, Harvest-Vinccler made an in-kind distribution to its shareholders of a note receivable from HNR Energia that it held. As a result, Vinccler received a $10.4 million note. HNR Energia paid $4.3 million of the amount owed on the note leaving $6.1 million outstanding as of December 31, 2013. Principal and interest are payable upon the maturity date of June 30, 2016. Interest accrues at a rate of US dollar based LIBOR plus 0.5%.

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Commitments and Contingencies - Lease Commitments for Office Space (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013
Operating Leases Future Minimum Payments Due [Abstract]
Total payments due for office leases	$ 583
Payments due for office leases in Less than 1 year	521
Payments due for office leases in 1-2 Years	62
Payments due for office leases in 3-4 Years	0
Payments due for office leases After 4 Years	$ 0

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CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$ (77,456)	$ 1,212	$ 70,137
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depletion, depreciation and amortization	354	423	1,272
Impairment expense	3,770	9,312	4,775
Dry hole costs	0	5,617	40,467
Amortization of debt financing costs	1,489	690	975
Amortization of discount on debt	2,641	543	2,876
Foreign currency transaction loss	436	0	0
Loss on sale of interest in Harvest Holding	22,994	0	0
Gain on sale of assets	0	0	(106,225)
Debt conversion expense	0	2,915	0
Allowance for account and note receivable	0	5,180	0
Write off of accounts payable, carry obligation	0	(3,596)	0
Loss on early extinguishment of debt	0	5,425	10,983
Earnings from equity affiliates	(72,578)	(67,769)	(73,451)
Share-based compensation-related charges	3,046	3,500	4,642
Unrealized (gain) loss on derivatives	(3,517)	600	(9,786)
Changes in operating assets and liabilities:
Accounts and notes receivable	993	9,542	(10,025)
Prepaid expenses and other	710	(718)	4,065
Other assets	3,971	(87)	(4,180)
Accounts payable	428	(3,411)	(623)
Accrued expenses	3,790	4,757	7,475
Accrued interest	(244)	(238)	(942)
Income taxes payable	2,076	(587)	617
Deferred tax asset and liabilities	73,689	(821)	0
Other current liabilities	(3,119)	906	2,632
Other long term liabilities	(550)	200	(927)
NET CASH USED IN OPERATING ACTIVITIES	(37,077)	(26,405)	(55,243)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of assets	0	0	218,823
Additions of property and equipment	(43,906)	(23,575)	(72,180)
Additions to assets held for sale	0	0	(33,930)
Advances (to) from equity affiliate	(531)	(414)	(682)
Proceeds from sale of interest in equity affiliates, net	124,045	0	1,385
(Increase) decrease in restricted cash	852	200	(1,200)
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES	80,460	(23,789)	112,216
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuances of common stock	9,420	719	924
Tax benefits related to equity compensation	0	0	2,535
Proceeds from issuance of long-term debt	0	66,480	0
Payments of long-term debt	0	0	(60,000)
Treasury stock purchases	(77)	0	0
Payments on note payable to noncontrolling interest owner	(4,260)	0	0
Financing costs	(196)	(3,324)	(189)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES	4,887	63,875	(56,730)
NET INCREASE IN CASH AND CASH EQUIVALENTS	48,270	13,681	243
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR	72,627	58,946	58,703
CASH AND CASH EQUIVALENTS AT END OF YEAR	120,897	72,627	58,946
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid during the year for interest expense (net of capitalization)	487	640	2,685
Cash paid during the year for income taxes	495	216	8,241
Supplemental Schedule of Noncash Investing and Financing Activities:
Increase (decrease) in current liabilities related to additions of property and equipment	(13,926)	10,500	3,416
Non-cash distribution of note payable to noncontrolling interest owner	$ 10,370	$ 0	$ 0

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CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) In Thousands, except Per Share data, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Statement Of Financial Position [Abstract]
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	5,000	5,000
Preferred stock, shares outstanding
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	80,000	80,000
Common stock, shares issued	48,666	45,882
Treasury stock, shares	6,551	6,527

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China

12 Months Ended

Dec. 31, 2013

Segment Reporting [Abstract]

China

Note 10 – China

In December 1996, we acquired a petroleum contract with China National Offshore Oil Corporation (“CNOOC”) for the WAB-21 area. The WAB-21 petroleum contract covers 6.2 million acres in the South China Sea, with an option for an additional 1.25 million acres under certain circumstances, and lies within an area which is the subject of a border dispute between China and Socialist Republic of Vietnam (“Vietnam”). Vietnam has executed an agreement on a portion of the same offshore acreage with another company. The border dispute has lasted for many years, and there has been limited exploration and no development activity in the WAB-21 area due to the dispute. Due to the border dispute between China and Vietnam, we have been unable to pursue an exploration program during Phase One of the contract. As a result, we have obtained license extensions, with the current extension in effect until May 31, 2013. The Joint Management Committee has approved an extension of the license until May 31, 2015. We are meeting with CNOOC in April 2013 to discuss the ratification of the extension. Regular meetings are held with CNOOC with contingent work programs being planned and annual budgets being set. While no assurance can be given, we believe we will continue to receive contract extensions so long as the border disputes persist. Even though there continues to be increasing activity on the Vietnamese blocks which we believe confirms our view of WAB-21’s prospectivity, we impaired the carrying value of WAB-21 of $2.9 million during the year ended December 31, 2012 due to our continued inability to pursue an exploration program. However, we continue to seek permission to acquire regional 2-D seismic and localized 3-D seismic.

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Operating Segments - Operating Segment Assets (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Segment Reporting Information [Line Items]
TOTAL ASSETS	$ 734,880	$ 596,837
Operating Segments [Member]
Segment Reporting Information [Line Items]
TOTAL ASSETS	734,851	596,524
Operating Segments [Member] | Venezuela [Member]
Segment Reporting Information [Line Items]
TOTAL ASSETS	500,946	428,992
Operating Segments [Member] | Gabon [Member]
Segment Reporting Information [Line Items]
TOTAL ASSETS	107,851	80,908
Operating Segments [Member] | Indonesia [Member]
Segment Reporting Information [Line Items]
TOTAL ASSETS	5,004	9,587
Operating Segments [Member] | United States [Member]
Segment Reporting Information [Line Items]
TOTAL ASSETS	121,050	77,037
Discontinued operations [Member]
Segment Reporting Information [Line Items]
TOTAL ASSETS	$ 29	$ 313

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Stock-Based Compensation and Stock Purchase Plans - Common Stock Warrants - Summary of Dates the Warrants were Issued, the Expiration Dates, the Exercise Prices and the Number of Warrants Issued and Outstanding (Detail)	12 Months Ended
	Dec. 31, 2013
Summary of dates the warrants were issued, the expiration dates, the exercise prices and the number of warrants issued and outstanding
Warrants Issued	2,513,000
Warrants Outstanding	2,513,000
Class Of Warrant One [Member]
Summary of dates the warrants were issued, the expiration dates, the exercise prices and the number of warrants issued and outstanding
Warrants Issue Date	2010-11
Expiration Date	2015-11
Exercise Price	12.95
Warrants Issued	1,600,000
Warrants Outstanding	1,600,000
Class Of Warrant Two [Member]
Summary of dates the warrants were issued, the expiration dates, the exercise prices and the number of warrants issued and outstanding
Warrants Issue Date	2011-10
Expiration Date	2015-11
Exercise Price	12.95
Warrants Issued	2,000
Warrants Outstanding	2,000
Class Of Warrant Three [Member]
Summary of dates the warrants were issued, the expiration dates, the exercise prices and the number of warrants issued and outstanding
Warrants Issue Date	2012-03
Expiration Date	2015-11
Exercise Price	12.95
Warrants Issued	73,000
Warrants Outstanding	73,000
Class Of Warrant Four [Member]
Summary of dates the warrants were issued, the expiration dates, the exercise prices and the number of warrants issued and outstanding
Warrants Issue Date	2012-08
Expiration Date	2015-11
Exercise Price	12.95
Warrants Issued	30,000
Warrants Outstanding	30,000
Class Of Warrant Five [Member]
Summary of dates the warrants were issued, the expiration dates, the exercise prices and the number of warrants issued and outstanding
Warrants Issue Date	2012-10
Expiration Date	2015-11
Exercise Price	12.95
Warrants Issued	15,000
Warrants Outstanding	15,000
Class Of Warrant Six [Member]
Summary of dates the warrants were issued, the expiration dates, the exercise prices and the number of warrants issued and outstanding
Warrants Issue Date	2013-07
Expiration Date	2015-11
Exercise Price	12.95
Warrants Issued	29,000
Warrants Outstanding	29,000
Class Of Warrant Seven [Member]
Summary of dates the warrants were issued, the expiration dates, the exercise prices and the number of warrants issued and outstanding
Warrants Issue Date	2013-10
Expiration Date	2015-11
Exercise Price	12.95
Warrants Issued	22,000
Warrants Outstanding	22,000
Class Of Warrant Eight [Member]
Summary of dates the warrants were issued, the expiration dates, the exercise prices and the number of warrants issued and outstanding
Warrants Issue Date	2013-11
Expiration Date	2011-11
Exercise Price	12.95
Warrants Issued	55,000
Warrants Outstanding	55,000
Class Of Warrant Nine [Member]
Summary of dates the warrants were issued, the expiration dates, the exercise prices and the number of warrants issued and outstanding
Warrants Issue Date	2012-10
Expiration Date	2015-10
Exercise Price	10.00
Warrants Issued	687,000
Warrants Outstanding	687,000

XML

Document and Entity Information (USD $)	12 Months Ended
	Dec. 31, 2013	Mar. 07, 2014	Jun. 28, 2013
Document And Entity Information [Abstract]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	FY
Trading Symbol	HNR
Entity Registrant Name	HARVEST NATURAL RESOURCES, INC.
Entity Central Index Key	0000845289
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		42,104,038
Entity Public Float			$ 122,116,759

XML

Debt

12 Months Ended

Dec. 31, 2013

Debt Disclosure [Abstract]

Debt

Note 11 – Debt

Debt consists of the following (in thousands):

	As of December 31,
	2013			2012
Senior notes, unsecured, with interest at 11%	$	79,750		$	79,750
Discount on 11% senior unsecured notes		(2,270	)		(4,911	)
Less current portion		(77,480	)		0
	$	0		$	74,839

On October 11, 2012, we closed the sale of $79.8 million aggregate principal amount of 11 percent senior unsecured notes due October 11, 2014. Under the terms of the notes, interest is payable quarterly in arrears on January 1, April 1, July 1 and October 1, beginning January 1, 2013. The 11 percent senior unsecured notes are general unsecured obligations, ranking equally in right of payment with all our future senior unsecured indebtedness. The senior unsecured notes are structurally subordinated to indebtedness and other liabilities of our subsidiaries.

The 11 percent senior unsecured notes were issued at a price of 96 percent of principal amount. The original issue discount (“OID”) is recorded as a Discount on Debt. Warrants to purchase up to 0.8 million shares of our common stock with an exercise price of $10.00 per share were issued in connection with the 11 percent senior unsecured notes. The fair value of the warrants is recorded as Discount on Debt. The OID and Discount on Debt are being amortized over the life of the debt.

Financing costs associated with the 11 percent senior unsecured notes are recorded in other assets and are amortized over the life of the notes. The balance for financing costs, substantially all of which relates to the 11 percent senior unsecured notes, was $1.3 million at December 31, 2013 ($3.2 million at December 31, 2012).

As discussed in Note 2 – Liquidity, we used a portion of the $125 million in proceeds from the sale of the 29 percent interest in Harvest Holding that we received on December 16, 2013, to redeem all of our 11% Senior Notes due 2014. The notes were redeemed on January 11, 2014, for $80.0 million, including principal and accrued and unpaid interest. As a result of the redemption, we will record a loss on extinguishment of debt of approximately $3.6 million during the three months ended March 31, 2014. This loss is primarily includes the write off of the discount on debt ($2.3 million) and the expensing of financing costs related to the term loan facility ($1.3 million).

In the event that a sale of assets (farm-outs are not included in the definition of a sale of assets in the indenture) for more than $5.0 million in the aggregate occurs, within 30 days of such event, we are required to make an offer to all noteholders of our 11 percent senior unsecured notes to purchase the maximum principal amount of our 11 percent senior unsecured notes that may be purchased out of the sales proceeds at an offer price in cash in an amount equal to 105.5 percent of the principal amount plus accrued and unpaid interest, if any. In the event of a change in control or a sale of Petrodelta, the noteholders of our 11 percent senior unsecured notes have the right to require us to repurchase all or any part of the 11 percent senior unsecured notes at a repurchase price equal to 101 percent in the case of a change in control or 105.5 percent in the case of a sale of Petrodelta plus accrued interest.

As of December 31, 2012, we assessed the prepayment requirements and concluded that this feature met the criteria to be considered an embedded derivative. We considered the probabilities of these events occurring and determined that the derivative had a value of $0 million at December 31, 2012. Due to the notice of redemption issued on December 11, 2013 prior to a sale of assets, change in control or sale of Petrodelta, we determined that this feature was not an embedded derivative at December 31, 2013.

On February 17, 2010, we closed an offering of $32.0 million in aggregate principal amount of our 8.25 percent senior convertible notes. Under the terms of the notes, interest was payable semi-annually in arrears on March 1 and September 1 of each year, beginning September 1, 2010. The senior convertible notes matured on March 1, 2013 unless earlier redeemed, repurchased or converted. The notes were convertible into shares of our common stock at a conversion rate of 175.2234 shares of common stock per $1,000 principal amount of senior convertible notes, equivalent to a conversion price of approximately $5.71 per share of common stock. The 8.25 percent senior convertible notes were general unsecured obligations, ranking equally with all of our other unsecured senior indebtedness, if any, and senior in right of payment to any of our subordinated indebtedness, if any.

Non-cash payment of debt during the year ended December 31, 2011 was $0.5 million of senior convertible notes converted into 0.1 million share of common stock at a conversion rate of $5.71 per share. Non-cash payment of debt during the year ended December 31, 2012 was $25.5 million of the senior convertible notes exchanged for 4.6 million shares of common stock at an effective exchange price of $5.59 per share. The difference between the exchange price and the market price on the date of the transaction is recorded as debt conversion expense on our consolidated statements of operations and comprehensive income (loss). The remaining balance of the senior convertible notes, $6.0 million, was repaid by way of a non-cash exchange for approximately $10.5 million of the 11 percent senior unsecured notes, the value of which was agreed to by us and the noteholder that the noteholder would have otherwise attained had the noteholder converted the note into shares of common stock. The difference between the value of the senior convertible notes exchanged and the senior unsecured notes received is recorded as a loss on extinguishment of debt on our consolidated statements of operations and comprehensive income (loss).

Financing costs associated with the 8.25 percent senior convertible notes were amortized over the life of the notes and were recorded in other assets. In connection with the exchange of convertible notes into our common stock, we reclassified $0.6 million of deferred financing costs to additional paid in capital. Financing costs for the convertible notes were fully amortized or reclassified at December 31, 2012 ($1.0 million at December 31, 2011).

On October 29, 2010, we closed a $60.0 million term loan facility with MSD Energy Investments Private II, LLC (“MSD Energy”), an affiliate of MSD Capital, L.P., as the sole lender under the term loan facility. Under the terms of the term loan facility, interest was paid on a monthly basis at the initial rate of 10 percent and had a maturity of October 28, 2012. The initial rate of interest was scheduled to increase to 15 percent on July 28, 2011, the Bridge Date. Financing costs associated with the term loan facility were being amortized over the remaining life of the loan and were recorded in other assets. See Note 15 – Stock-Based Compensation and Stock Purchase Plans – Common Stock Warrants for a discussion of the warrants that were issued in connection with the $60.0 million term loan facility.

In May 2011, we prepaid our $60 million term loan facility. The early repayment resulted in a loss on extinguishment of debt of $13.1 million. The loss on extinguishment of debt includes the write off of the discount on debt ($10.6 million), a prepayment premium of 3.5 percent of the amount outstanding ($2.1 million), and expensing of financing costs related to the term loan facility ($0.4 million).

The principal payment requirements for our debt outstanding at December 31, 2013 are as follows (in thousands):

2014	$	79,750
	$	79,750

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Stock-Based Compensation and Stock Purchase Plans - Summary of Status of Stock Option Plans (Detail) (Options [Member], USD $) In Thousands, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Options [Member]
Summary of the status of stock option plans
Options outstanding, shares, beginning balance	3,897
Options granted, shares	920
Options exercised, shares	(20)
Options cancelled, shares	(64)
Options outstanding, shares, ending balance	4,733	3,897
Options exercisable, shares	2,905	2,500	2,200
Options outstanding, weighted-average exercise price, beginning balance	$ 9.62
Options granted, weighted-average exercise price	$ 4.80
Options exercised, weighted-average exercise price	$ (6.10)
Options cancelled, weighted-average exercise price	$ (6.74)
Options outstanding, weighted-average exercise price, ending balance	$ 8.74	$ 9.62
Options exercisable, weighted-average exercise price	$ 9.85	$ 10.12	$ 10.15
Options outstanding, remaining contractual life	2 years 1 month 6 days	2 years 7 months 6 days
Options exercisable, remaining contractual life	1 year 3 months 18 days
Options outstanding, aggregate intrinsic value	$ 0	$ 3,064
Options exercisable, aggregate intrinsic value	$ 0

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Stock-Based Compensation and Stock Purchase Plans - Common Stock Warrants - Additional Information (Detail) (USD $)	0 Months Ended	12 Months Ended				12 Months Ended		1 Months Ended						12 Months Ended		12 Months Ended			0 Months Ended	12 Months Ended
	Jul. 28, 2011	Dec. 31, 2013	Dec. 31, 2012	Oct. 11, 2012	Dec. 31, 2011	Dec. 31, 2012 11% senior unsecured notes [Member]	Oct. 11, 2012 11% senior unsecured notes [Member]	Nov. 30, 2010 Class Of Warrant One [Member]	Nov. 30, 2010 Class Of Warrant Two [Member]	Nov. 30, 2010 Class Of Warrant Three [Member]	Oct. 11, 2012 Class Of Warrant Three [Member]	Nov. 30, 2010 Term Loan [Member]	Dec. 31, 2013 Senior Convertible Notes [Member]	Dec. 31, 2013 Tranche B [Member]	Jul. 28, 2011 Tranche B [Member]	Dec. 31, 2013 Tranche A [Member]	Oct. 11, 2012 Tranche A [Member]	Jul. 28, 2011 Tranche A [Member]	May 17, 2011 Tranche C [Member]	Dec. 31, 2013 Tranche C [Member]	Jul. 28, 2011 Tranche C [Member]	Nov. 30, 2010 Tranche C [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Term loan facility closed												$ 60,000,000
Warrants exercisable issued							700,000	1,200,000	400,000	4,400,000	700,000
Issue price of warrants								15	15	15
Average closing bid price, percentage	120.00%								120.00%	120.00%
Warrant exercisable period	20 days													5 years
Warrants exercisable price	14.78														20.00		10.00	15.00			15.00
Number of trading days														20 days		20 days				20 days
Redemption price per warrants																			$ 0.01			$ 0.01
Redemption price of warrants																			44,000
Issuance of additional warrants		105,667	118,327		2,007
Exercise price per share of warrants					$ 5.71								$ 12.95
Minimum percentage of voting power of outstanding common stock, condition for fundamental change		50.00%
Debt instrument interest rate stated percentage				11.00%		11.00%
Warrants exercisable anniversary period			3 years
Adjustments to additional paid in capital, warrant issued			$ 2,572,000			$ 2,800,000

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CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (USD $) In Thousands, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
EXPENSES:
Depreciation and amortization	$ 341	$ 391	$ 439
Exploration expense	15,155	8,838	11,950
Impairment expense	575	2,900	3,335
Dry hole costs	0	685	40,003
General and administrative	29,365	26,012	21,428
Total expenses	45,436	38,826	77,155
LOSS FROM OPERATIONS	(45,436)	(38,826)	(77,155)
OTHER NON-OPERATING INCOME (EXPENSE):
Investment earnings and other	280	348	665
Loss on sale of interest in Harvest Holding	(22,994)	0	0
Unrealized gain (loss) on derivatives	3,517	(600)	9,786
Interest expense	(4,495)	(1,590)	(7,159)
Debt conversion expense	0	(3,645)	0
Loss on extinguishment of debt	0	(5,425)	(13,132)
Foreign currency transaction losses	(820)	(113)	(132)
Other non-operating expenses	(1,849)	(2,905)	(1,375)
Total other non-operating income (expense)	(26,361)	(13,930)	(11,347)
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES	(71,797)	(52,756)	(88,502)
INCOME TAX EXPENSE (BENEFIT)	73,087	(609)	1,057
LOSS FROM CONTINUING OPERATIONS BEFORE EARNINGS FROM EQUITY AFFILIATES	(144,884)	(52,147)	(89,559)
EARNINGS FROM EQUITY AFFILIATES	72,578	67,769	73,451
INCOME (LOSS) FROM CONTINUING OPERATIONS	(72,306)	15,622	(16,108)
DISCONTINUED OPERATIONS:
Loss from discontinued operations	(5,150)	(14,410)	(14,007)
Gain on sale of assets	0	0	106,000
Income tax expense on discontinued operations	0	0	(5,748)
Income (loss) from discontinued operations	(5,150)	(14,410)	86,245
NET INCOME (LOSS)	(77,456)	1,212	70,137
LESS: NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS	11,640	13,423	14,177
NET INCOME (LOSS) ATTRIBUTABLE TO HARVEST [COMPREHENSIVE INCOME (LOSS)]	$ (89,096)	$ (12,211)	$ 55,960
BASIC EARNINGS (LOSS) PER SHARE:
Income (loss) from continuing operations	$ (2.12)	$ 0.06	$ (0.89)
Discontinued operations	$ (0.13)	$ (0.39)	$ 2.53
Basic earnings (loss) per share	$ (2.25)	$ (0.33)	$ 1.64
DILUTED EARNINGS (LOSS) PER SHARE:
Income (loss) from continuing operations	$ (2.12)	$ 0.06	$ (0.89)
Discontinued operations	$ (0.13)	$ (0.39)	$ 2.53
Diluted earnings (loss) per share	$ (2.25)	$ (0.33)	$ 1.64

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Dispositions

12 Months Ended

Dec. 31, 2013

Discontinued Operations And Disposal Groups [Abstract]

Dispositions

Note 5 – Dispositions

Share Purchase Agreement

On December 16, 2013, Harvest and HNR Energia entered into the Share Purchase Agreement with Petroandina and Pluspetrol, its parent, to sell all of our 80 percent equity interest in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement, when we sold a 29 percent equity interest in Harvest Holding for $125 million. This first transaction resulted in a loss on the sale of the interest in Harvest Holding of $23.0 million in the year ended December 31, 2013. As a result of this first sale, we indirectly own 51 percent of Harvest Holding beginning December 16, 2013 and the noncontrolling interest owners hold the remaining 49 percent with Petroandina having 29 percent and Vinccler continuing to own 20 percent. We will continue to consolidate Harvest Holding’s results until the sale of the remaining 51 percent interest has been completed. The second closing, for the sale of a 51 percent equity interest in Harvest Holding for a cash purchase price of $275 million, will be subject to, among other things, approval by the holders of a majority of our common stock and approval by the Ministerio del Poder Popular de Petroleo y Mineria representing the Government of Venezuela (which indirectly owns the other 60 percent interest in Petrodelta).

HNR Energia and Petroandina also entered into a Shareholders’ Agreement (the “Shareholders’ Agreement”) on December 16, 2013, regarding the shares of Harvest Holding. The Shareholders’ Agreement becomes effective upon any termination of the Share Purchase Agreement before the second closing of the sale of the remaining shares of Harvest Holding.

The Share Purchase Agreement provides for certain put/call rights and termination payments under certain circumstances. If the Share Purchase Agreement is terminated because of the failure to obtain authorization by our stockholders, we will be required to pay Petroandina a fee of $3.0 million, and Petroandina will have the right to sell back to HNR Energia its 29 percent interest in Harvest Holding. If we terminate the Share Purchase Agreement and accept a superior proposal, we must pay Petroandina a break-up fee equal to $9.6 million and Petroandina has the right to sell back to HNR Energia, and HNR Energia has the right to cause Petroandina to sell back to HNR Energia, its interest in Harvest Holding. We must also pay the reasonable out-of-pocket expenses of Petroandina incurred in connection with the Share Purchase Agreement, up to $4 million, if the Share Purchase Agreement is terminated as a result of our breach of a representation or warranty or covenant, and in certain instances Petroandina also has the right and option to sell to HNR Energia its 29 percent interest. HNR Energia has the right and option to purchase from Petroandina its 29 percent interest in Harvest Holding on termination of the Share Purchase Agreement in certain other circumstances. Harvest has guaranteed HNR Energia’s obligations under the Share Purchase Agreement and the Shareholders’ Agreement.

During the term of the Share Purchase Agreement, Harvest Holding may not pay any dividends to HNR Energia, and therefore would not benefit from any dividends paid by Petrodelta during this period.

Discontinued Operations

As a result of the decision to not request an extension of the First Phase or enter the Second Phase of the Exploration and Production Sharing Agreement (“EPSA”) Al Ghubar / Qarn Alam license (“Block 64 EPSA”), Block 64 was relinquished effective May 23, 2013. The carrying value of Block 64 EPSA of $6.4 million was considered impaired and a related impairment expense was recorded during the year ended December 31, 2012. Operations in Oman were terminated, and the field office was closed May 31, 2013. We have no continuing operations in Oman.

In February 2013, we signed farm-out agreements on Block VSM14 and Block VSM15 in Colombia. Under the terms of the farm-out agreements, we had a 75 percent beneficial working interest and our partners had a 25 percent carried interest for the minimum exploratory work commitments on each block. We requested the legal assignment of the interest by the Agencia Nacional de Hidrocarburos (“ANH”), Colombia’s oil and gas regulatory authority, and approval of us as operator.

We have received notices of default from our partners for failing to comply with certain terms of the farmout agreements for Block VSM 14 and Block VSM 15, followed by notices of termination on November 27, 2013. As discussed further in Note 13 — Commitments and Contingencies, our partners have filed for arbitration of claims related to these agreements. We have accrued $2.0 million as of December 31, 2013 related to this matter. After evaluating these circumstances, we determined that it was appropriate to fully impair the costs associated with these interests, and we recorded an impairment charge of $3.2 million during the year ended December 31, 2013. As we no longer have any interests in Colombia, we have reflected the results in discontinued operations.

On May 17, 2011, we closed the transaction to sell the Antelope Project. The sale had an effective date of March 1, 2011. We received cash proceeds of approximately $217.8 million which reflects increases to the purchase price for customary adjustments and deductions for transaction related costs. We do not have any continuing involvement with the Antelope Project. The related gain on the sale was reported in discontinued operations in the second quarter of 2011.

During the year ended December 31, 2012, we incurred $0.1 million of expense related to settlement of royalty payments to the Mineral Management Services, write-offs of $5.2 million of accounts and note receivable and $3.6 million of accounts payable, carry obligation related to the settlement of all outstanding claims with a private third party on the Antelope Project. The note receivable related to a prospect leasing cost financing arrangement. The note receivable plus accrued interest was approximately $3.3 million at December 31, 2011, and was secured by a portion of the production from the Bar F #1-20-3-2 in Utah.

Oman operations, Colombia operations and the Antelope Project have been classified as discontinued operations. Revenue and income (loss) are shown in the table below:

	Year Ended December 31,
	2013			2012			2011
				(in thousands)
Revenue applicable to discontinued operations:
Oman	$	0		$	0		$	0
Colombia		0			0			0
Antelope Project		0			0			6,488
	$	0		$	0		$	6,488
Income (loss) from discontinued operations:
Oman	$	(674	)	$	(12,711	)	$	(11,371	)
Colombia		(4,476	)		0			0
Antelope Project		0			(1,699	)		97,616
	$	(5,150	)	$	(14,410	)	$	86,245

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Earnings Per Share

12 Months Ended

Dec. 31, 2013

Earnings Per Share [Abstract]

Earnings Per Share

Note 4 – Earnings Per Share

Basic earnings per common share (“EPS”) are computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that would occur if securities or other contracts to issue common stock were exercised or converted into common stock.

	Year Ended December 31,
	2013			2012			2011
	(in thousands, except per share amounts)
Income (loss) from continuing operations(a)	$	(83,946	)	$	2,199		$	(30,285	)
Discontinued operations		(5,150	)		(14,410	)		86,245
Net income (loss) attributable to Harvest	$	(89,096	)	$	(12,211	)	$	55,960
Weighted average common shares outstanding		39,579			37,424			34,117
Effect of dilutive securities		0			167			0
Weighted average common shares, diluted		39,579			37,591			34,117
Basic Earnings (Loss) Per Share:
Income (loss) from continuing operations	$	(2.12	)	$	0.06		$	(0.89	)
Discontinued operations		(0.13	)		(0.39	)		2.53
Basic earnings (loss) per share	$	(2.25	)	$	(0.33	)	$	1.64
Diluted Earnings (Loss) Per Share:
Income (loss) from continuing operations	$	(2.12	)	$	0.06		$	(0.89	)
Income (loss) from discontinued operations		(0.13	)		(0.39	)		2.53
Diluted earnings (loss) per share	$	(2.25	)	$	(0.33	)	$	1.64

^(a)  Net of net income attributable to noncontrolling interests.

The year ended December 31, 2013 per share calculations above exclude 4.2 million options and 2.5 million warrants because they were anti-dilutive. The year ended December 31, 2012 per share calculations above exclude 3.9 million options and 2.4 million warrants because they were anti-dilutive. The year ended December 31, 2011 per share calculations above exclude 3.7 million options and 1.6 million warrants because they were anti-dilutive.

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Operating Segments

12 Months Ended

Dec. 31, 2013

Segment Reporting [Abstract]

Operating Segments

Note 16 – Operating Segments

We regularly allocate resources to and assess the performance of our operations by segments that are organized by unique geographic and operating characteristics. The segments are organized in order to manage regional business, currency and tax related risks and opportunities. Operations included under the heading “United States” include corporate management, cash management, business development and financing activities performed in the United States and other countries, which do not meet the requirements for separate disclosure. All intersegment revenues, other income and equity earnings, expenses and receivables are eliminated in order to reconcile to consolidated totals. Corporate general and administrative and interest expenses are included in the United States segment and are not allocated to other operating segments. In previous years, charges for intersegment general and administrative and interest expenses were included in results for the respective operating segments, and operating segment assets included intersegment receivables and loans. Segment income (loss) and operating segment assets for prior periods have been adjusted to conform to the current presentation method in which intersegment items are eliminated from each segment’s results and assets.

	Year Ended December 31,
	2013			2012			2011
				(in thousands)
Segment Income (Loss) Attributable to Harvest
Venezuela	$	58,640		$	51,584		$	54,974
Gabon		(12,908	)		(2,902	)		(6,158	)
Indonesia		(9,213	)		(4,052	)		(45,416	)
United States		(120,465	)		(42,431	)		(33,685	)
Income (loss) from continuing operations (a)		(83,946	)		2,199			(30,285	)
Discontinued operations		(5,150	)		(14,410	)		86,245
Net income (loss) attributable to Harvest	$	(89,096	)	$	(12,211	)	$	55,960

^(a)  Net of net income attributable to noncontrolling interest.

	As of December 31,
	2013		2012
	(in thousands)
Operating Segment Assets
Venezuela	$	500,946	$	428,992
Gabon		107,851		80,908
Indonesia		5,004		9,587
United States		121,050		77,037
		734,851		596,524
Discontinued operations		29		313
Total Assets	$	734,880	$	596,837

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Warrant Derivative Liabilities

12 Months Ended

Dec. 31, 2013

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Warrant Derivative Liabilities

Note 12 – Warrant Derivative Liabilities

The Warrants, which have anti-dilution protection features, do not meet the conditions to obtain equity classification under ASC 480 “Distinguishing Liabilities From Equity” as there are conditions which may require settlement by transferring assets. These Warrants are required to be carried as derivative liabilities, at fair value, with current changes in fair value reflected in our consolidated statements of operations and comprehensive income. As of December 31, 2013, the Warrants consisted of 1,826,001 warrants (1,720,334 at December 31, 2012) issued under the warrant agreements dated November 2010 in connection with a $60 million term loan facility. The fair value of the Warrants as of December 31, 2013 was $1.07 per warrant ($3.18 per warrant at December 31, 2012).

In the occurrence of a fundamental change, we are required to repurchase the Warrants at the higher of (1) the fair market value of the warrant and (2) a valuation based on a computation of the option value of the Warrant using the Black-Scholes calculation method using the assumptions described in the warrant agreement. A fundamental change is defined as the occurrence of one of the following events: a) a person or group becomes the direct or indirect owner of more than 50 percent of the voting power of the outstanding common stock, b) a merger event or similar transaction in which the majority owners before the transaction fail to own a majority of the voting power of the Company after the transaction, and c) approval of a plan of liquidation or dissolution of the Company or sale of all or substantially all of the Company’s assets.

Estimating fair values of derivative financial instruments requires the development of significant and subjective estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques (such the Monte Carlo model) are highly volatile and sensitive to changes in the trading market price of our common stock. Since derivative financial instruments are initially and subsequently carried at fair value, our income will reflect the volatility in these estimate and assumption changes.

The Monte Carlo model is used on the Warrants to reasonably value the potential future exercise price adjustments triggered by the anti-dilution provisions. This requires Level 3 inputs (see Note 3 – Summary of Significant Accounting Policies, Financial Instruments and Fair Value Measurements) which are based on our estimates of the probability and timing of potential future financings and fundamental transactions. The assumptions summarized in the following table were used to calculate the fair value of the warrant derivative liability that was outstanding as of any of the balance sheet dates presented on our consolidated balance sheets:

	Fair Value Hierarchy Level
			As of December 31,
			2013			2012
Significant assumptions (or ranges):
Stock price		Level 1 input	$	4.52		$	9.07
Term (years)				1.83			2.83
Volatility		Level 2 input		94	%		70	%
Risk-free rate		Level 1 input		0.34	%		0.33	%
Dividend yield		Level 2 input		0.0	%		0.0	%
Scenario probability (fundamental change event/debt raise/equity raise)		Level 3 input		60%/40%/0	%		0%/80%/20	%

Inherent in the Monte Carlo valuation model are assumptions related to expected stock price volatility, expected life, risk-free interest rate and dividend yield. As part of our overall valuation process, management employs processes to evaluate and validate the methodologies, techniques and inputs, including review and approval of valuation judgments, methods, models, process controls, and results. These processes are designed to help ensure that the fair value measurements and disclosures are appropriate, consistently applied, and reliable. We estimate the volatility of our common stock based on historical volatility that matches the expected remaining life of the warrants. The risk-free interest rate is based on the U.S. Treasury yield curve as of the valuation dates for a maturity similar to the expected remaining life of the warrants. The expected life of the warrants is assumed to be equivalent to their remaining contractual term. The dividend rate is based on the historical rate, which we anticipate to remain at zero.

All our warrant derivative contracts are recorded at fair value and are classified as warrant derivative liability on the consolidated balance sheet. The following table summarizes the effect on our income (loss) associated with changes in the fair values of our warrant derivative financial instruments:

	Year Ended December 31,
	2013		2012
	(in thousands)
Unrealized gain (loss) on warrant derivatives	$	3,517	$	(600	)

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Stock-Based Compensation and Stock Purchase Plans - Summary of Restricted Stock Awards (Detail) (Restricted Stock [Member], USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Restricted Stock [Member]
Summary of unvested stock option awards
Unvested Outstanding, shares, beginning balance	284,750
Outstanding Granted, shares	190,002	0	179,050
Outstanding Vested, shares	(160,600)
Outstanding Forfeited, shares	0
Unvested Outstanding, shares, ending balance	314,152	284,750
Unvested Outstanding, Weighted-Average Grant - Date Fair Value, beginning balance	$ 8.93
Granted, Weighted-Average Grant - Date Fair Value	$ 4.80	$ 5.85	$ 11.21
Vested, Weighted-Average Grant - Date Fair Value	$ (7.23)
Forfeited, Weighted-Average Grant - Date Fair Value
Unvested Outstanding, Weighted-Average Grant - Date Fair Value, ending balance	$ 7.30	$ 8.93

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Gabon

12 Months Ended

Dec. 31, 2013

Text Block [Abstract]

Gabon

Note 8 – Gabon

We are the operator of the Dussafu PSC with a 66.667 percent ownership interest. Located offshore Gabon, adjacent to the border with the Republic of Congo, the Dussafu PSC covers an area of 680,000 acres with water depths up to 1,650 feet.

The Dussafu PSC partners and the Republic of Gabon, represented by the Ministry of Mines, Energy, Petroleum and Hydraulic Resources, entered into the third exploration phase of the Dussafu PSC with an effective date of May 28, 2012. The Direction Generale Des Hydrocarbures (“DGH”) agreed to lengthen the third exploration phase to four years until May 27, 2016.

During 2011, we drilled our first exploratory well, Dussafu Ruche Marin-1 (“DRM-1”), and two appraisal sidetracks. DRM-1 and sidetracks discovered oil of approximately 149 feet of pay within the Gamba and Middle Dentale Formations. DRM-1 and sidetracks are currently suspended pending further exploration and development activities. Operational activities during 2012 included completion of the time processing of 545 square kilometers of seismic, which was acquired in the fourth quarter of 2011, and well planning.

Well planning progressed during 2012 to drill an exploration well in the fourth quarter of 2012 on the Tortue prospect. DTM-1 well was spud November 19, 2012. DTM-1 was drilled with the Scarabeo 3 semi-submersible drilling unit. On January 4, 2013, we announced that DTM-1 had reached the Dental Formation and discovered oil in both the Gamba and Dentale formations. The first appraisal sidetrack of DTM-1 (“DTM-1ST1”) was spud in January 12, 2013 and drilled to a total depth of 11,385 feet in the Dentale Formation and found 65 feet of pay in the primary Dentale reservoir. Work on DTM-1 and DTM-1ST1 was suspended pending future appraisal and development activities.

Geoscience, reservoir engineering and economic studies have progressed and a field development plan is being prepared for a cluster field development of both the Ruche and Tortue discoveries along with existing pre-salt discoveries at Walt Whitman and Moubenga. Planning and contracting for a 3D seismic acquisition survey over the outer half of the license took place. Acquisition of a 1,260 square kilometer survey commenced in October 2013, and the first high quality seismic products are expected to be available during the second quarter of 2014. The new 3D seismic data should also enhance the placement of future development wells in the Ruche and Tortue development program.

See Note 13 – Commitments and Contingencies for a discussion of legal matters related to our Gabon operations.

The Dussafu PSC represents $103.4 million of unproved oil and gas properties including inventory on our December 31, 2013 balance sheet ($76.4 million at December 31, 2012).

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China - Additional Information (Detail) (WAB-21 [Member], USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Projects with Exploratory Well Costs Capitalized for More than One Year [Line Items]
Extension of the license (Date)	May 31, 2015
Impaired carrying value		$ 2.9
License extended expiry date	May 31, 2013
China National Offshore Oil Corporation [Member]
Projects with Exploratory Well Costs Capitalized for More than One Year [Line Items]
Petroleum contract coverage area	6,200,000
Additional coverage area	1,250,000

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Investment in Equity Affiliates

12 Months Ended

Dec. 31, 2013

Equity Method Investments And Joint Ventures [Abstract]

Investment in Equity Affiliates

Note 6 – Investment in Equity Affiliates

Venezuela – Petrodelta, S.A.

Petrodelta’s reporting and functional currency is the U.S. Dollar. HNR Finance owns a 40 percent interest in Petrodelta. As discussed further in Note 5 – Dispositions, Share Purchase Agreement, on December 16, 2013, Harvest and HNR Energia entered into the Share Purchase Agreement with Petroandina and Pluspetrol, its parent, to sell all of our 80 percent equity interest in Harvest Holding to Petroandina in two closings for an aggregate cash purchase price of $400 million. The first closing occurred on December 16, 2013 contemporaneously with the signing of the Share Purchase Agreement, when we sold a 29 percent equity interest in Harvest Holding for $125 million. This first transaction resulted in a loss on the sale of the interest in Harvest Holding of $23.0 million in the year ended December 31, 2013.

Petrodelta’s financial information is prepared in accordance with International Financial Reporting Standards (“IFRS”) which we have adjusted to conform to U.S. GAAP. The differences between IFRS and U.S. GAAP for which we adjust are:

• Deferred income tax: IFRS allows the inclusion of non-monetary temporary differences impacted by inflationary adjustments, whereas U.S. GAAP does not. In addition, we have adjusted for the impact on deferred income tax of other adjustments to arrive at net income under U.S. GAAP.

• Depletion expense: Oil and gas reserves used by Petrodelta in calculating depletion expense under IFRS are provided by MENPET. MENPET reserves are not prepared using the guidance on extractive activities for oil and gas (ASC 932). At least annually at yearend, we prepare reserve reports for Petrodelta’s oil and gas reserves using ASC 932. On a quarterly basis, we recalculate Petrodelta’s depletion using the most recent reserve report using ASC 932.

• Windfall Profits Tax Credit: The April 2011 Windfall Profits Tax law included a provision wherein it considered that an exemption of the Windfall Profits Tax could be granted for the incremental production of projects and grass root developments until the specific investments are recovered. The projects deemed to qualify for the exemption have to be considered and approved on a case by case basis by MENPET. In March 2013, PDVSA requested from MENPET a Windfall Profits Tax exemption credit under provisions in the April 2011 Windfall Profits Tax law. The exemption was applied to several oil development projects, including Petrodelta. However, MENPET has not defined the projects qualifying for exemption or provided the guidance necessary to calculate the exemption. PDVSA issued to Petrodelta its estimated share of the exemption credit related to 2012 of $55.2 million ($36.4 million net of tax) based on PDVSA’s calculation and projects PDVSA deemed to qualify for the exemption. Petrodelta has not been provided with supporting documentation indicating the properties have been appropriately qualified by MENPET, the specific details for the exemption credit, such as which fields, production period or production, or the supporting calculations. Until MENPET either issues guidance on the exemption provisions in the law or issues payment forms including the exemption credit, or written approval from MENPET for this exemption credit is received by Petrodelta or us, we have and will continue to exclude the exemption credit from our equity earnings in Petrodelta.

• Sports Law Overaccrual: The Organic Law on Sports, Physical Activity and Physical Education (“Sports Law”) was published in the Official Gazette on August 24, 2011. The purpose of the Sports Law is to establish the public service nature of physical education and the promotion, organization and administration of sports and physical activity. Funding of the Sports Law is by contributions made by companies or other public or private organizations that perform economic activities for profit in Venezuela. The contribution is one percent of annual net or accounting profit and is not deductible for income tax purposes. Per the Sports Law, contributions are to be calculated on an after-tax basis. However, in March 2012, CVP has instructed Petrodelta to calculate the contribution on a before-tax basis contrary to the Sports Law. As of December 31, 2013, the cumulative amount of overstatement of the liability by following this calculation method is $1.3 million ($0.3 million net to our 20.4 percent interest as of December 31, 2013). We have adjusted for the overaccrual of the Sports Law in the results reported for net income from equity affiliate during the applicable periods, i.e., the years ended December 31, 2013 and 2012.

In addition to the adjustments to arrive at Petrodelta’s net income under U.S. GAAP, earnings from equity affiliate also reflect the amortization of the excess basis in equity affiliate using the unit-of-production method based on risk adjusted total current estimated reserves.

All amounts through Net Income under U.S. GAAP represent 100 percent of Petrodelta. Summary financial information has been presented below at December 31, 2013 and 2012, and for the years ended December 31, 2013, 2012 and 2011:

	Year Ended December 31,
	2013			2012			2011
	(in thousands, except percentages)
Results under IFRS:
Revenues:
Oil sales	$	1,326,093		$	1,263,264		$	1,122,191
Gas sales		4,000			3,350			3,497
Royalty *		(440,963	)		(423,069	)		(374,135	)
		889,130			843,545			751,553
Expenses:
Operating expenses		151,661			121,023			77,236
Workovers		29,168			17,302			28,508
Depletion, depreciation and amortization		87,203			86,004			58,376
General and administrative		26,345			31,753			11,297
Windfall profits tax		234,453			291,355			237,632
Windfall profits credit		(55,168	)		0			0
		473,662			547,437			413,049
Income from operations		415,468			296,108			338,504
Gain on exchange rate		169,582			0			0
Investment earnings and other		15			13			610
Interest expense		(21,728	)		(7,017	)		(10,699	)
Income before income tax		563,337			289,104			328,415
Current income tax expense		325,217			127,080			190,577
Deferred income tax expense (benefit)		(17,662	)		76,030			(94,622	)
Net income under IFRS		255,782			85,994			232,460
Adjustments to increase (decrease) net income under IFRS:
Deferred income tax (expense) benefit		9,080			78,968			(49,545	)
Depletion expense		(20,352	)		7,282			1,908
Reversal of windfall profits tax credit		(55,168	)		0			0
Sports law over accrual		1,313			2,536			0
Net income under U.S. GAAP		190,655			174,780			184,823
Equity interest in equity affiliate		40	%		40	%		40	%
Income before amortization of excess basis in equity affiliate		76,262			69,912			73,929
Amortization of excess basis in equity affiliate		(3,684	)		(2,143	)		(1,863	)
Earnings from equity affiliate included in income	$	72,578		$	67,769		$	72,066

* As discussed below, royalties paid-in-kind have been adjusted to reflect market prices as required under U.S. GAAP.

	As of December 31,
	2013		2012
	(in thousands)
Financial Position under IFRS:
Current assets	$	1,906,595	$	1,425,115
Property and equipment		717,449		538,351
Other assets		181,116		70,468
Current liabilities		1,652,806		1,180,559
Other liabilities		136,298		93,101
Net equity		1,016,056		760,274

Conversion Contract

On October 25, 2007, the Venezuelan Presidential Decree which formally transferred to Petrodelta the rights to the Petrodelta Fields subject to the conditions of the Conversion Contract was published in the Official Gazette. Petrodelta is governed by its own charter and bylaws and will engage in the exploration, production, gathering, transportation and storage of hydrocarbons from the Petrodelta Fields for a maximum of 20 years from that date. Petrodelta operates a portfolio of properties in eastern Venezuela including large proven oil fields as well as properties with substantial opportunities for both development and exploration. Petrodelta is to undertake its operations in accordance with Petrodelta’s business plan as set forth in its conversion contract. Under its conversion contract, work programs and annual budgets adopted by Petrodelta must be consistent with Petrodelta’s business plan. Petrodelta’s business plan may be modified by a favorable decision of the shareholders owning at least 75 percent of the shares of Petrodelta.

Sales Contract

The sale of oil and gas by Petrodelta to the Venezuelan government is pursuant to a Contract for Sale and Purchase of Hydrocarbons with PDVSA Petroleo S.A. (“PPSA”) signed on January 17, 2008. The form of the agreement is set forth in the Conversion Contract. Crude oil delivered from the Petrodelta Fields to PPSA is priced with reference to Merey 16 published prices, weighted for different markets, and adjusted for variations in gravity and sulphur content, commercialization costs and distortions that may occur given the reference price and prevailing market conditions. Merey 16 published prices are quoted and sold in U.S. Dollars. Natural gas delivered from the Petrodelta Fields to PPSA is priced at $1.54 per thousand cubic feet. Natural gas deliveries are paid in Bolivars, but the pricing for natural gas is referenced to the U.S. Dollar. PPSA is obligated to make payment to Petrodelta of each invoice within 60 days of the end of the invoiced production month by wire transfer, in U.S. Dollars in the case of payment for crude oil and natural gas liquids delivered, and in Bolivars in the case of payment for natural gas delivered, in immediately available funds to the bank accounts designated by Petrodelta.

When the Sales Contract was executed, Petrodelta was producing only one type of crude, Merey 16. Beginning in October 2011, the Ministry of the People’s Power for Petroleum and Mining (“MENPET”) determined that Petrodelta’s production flowing through the COMOR transfer point was a heavier type of crude, Boscan. Since Petrodelta was producing only Merey 16 when the Sales Contract was executed, the Boscan gravity and sulphur correction factors and crude pricing formula are not included in the Sales Contract. However, under the Sales Contract, PPSA is obligated to receive all of Petrodelta’s production. All production deliveries for all of Petrodelta’s fields have been certified by MENPET and acknowledged by PPSA. All pricing factors to be used in the Merey 16 and Boscan pricing formulas have been provided by and certified by MENPET to Petrodelta.

Since the Sales Contract provides for only one crude pricing formula, the Sales Contract had to be amended to include the Boscan pricing formula to allow Petrodelta to invoice PPSA for El Salto crude oil deliveries. Petrodelta received a draft amendment to the Sales Contract from PDVSA Trade and Supply. The pricing formula in the draft amendment has been used to accrue revenue for El Salto field deliveries from October 1, 2011 through December 31, 2013. Except for the inclusion of the Boscan pricing formula to be used in invoicing El Salto crude oil deliveries, all other terms and conditions of the Sales Contract remain in force. On January 31, 2013, Petrodelta’s board of directors endorsed the amendment to the Sales Contract. The amendment has been approved by CVP’s board of directors. HNR Finance, as shareholder, has agreed to the contract amendment.

CVP’s board of directors reviewed the amendment on April 30, 2013. A certificate of CVP’s final board resolution approving the amendment dated April 30, 2013 was received by Petrodelta on May 23, 2013. The remaining steps for the contract amendment are to (1) inform MENPET of the approval, (2) receive approval from Petrodelta’s shareholders to amend the Sales Contract including the Boscan formula, and (3) sign the contract amendment with PDVSA Trade and Supply. Once the Sales Contract is executed, PPSA will be invoiced for the deliveries. As of December 31, 2013, revenues of $756.7 million ($352.7 million as of December 31, 2012) for El Salto remain uninvoiced to PPSA pending execution of the amendment.

Payments to Contractors

As discussed in previous filings, PDVSA has failed to pay on a timely basis certain amounts owed to contractors that PDVSA has contracted to do work for Petrodelta. PDVSA, through PPSA, purchases all of Petrodelta’s oil production. PDVSA and its affiliates have reported shortfalls in meeting their cash requirements for operations and planned capital expenditures, and PDVSA has fallen behind in certain of its payment obligations to its contractors, including contractors engaged by PDVSA to provide services to Petrodelta. In addition, PDVSA has fallen behind in certain of its payment obligations to Petrodelta, which payments Petrodelta would otherwise use to pay its contractors, including Harvest Vinccler. As a result, Petrodelta has experienced, and is continuing to experience, difficulty in retaining contractors who provide services for Petrodelta’s operations. We cannot provide any assurance as to whether or when PDVSA will become current on its payment obligations. Inability to retain contractors or to pay them on a timely basis is having an adverse effect on Petrodelta’s operations and on Petrodelta’s ability to carry out its business plan.

Harvest Vinccler has advanced certain costs on behalf of Petrodelta. These costs include consultants in engineering, drilling, operations, seismic interpretation, and employee salaries and related benefits for Harvest Vinccler employees seconded into Petrodelta. Currently, we have three employees seconded into Petrodelta. Costs advanced are invoiced on a monthly basis to Petrodelta. Harvest Vinccler is considered a contractor to Petrodelta,and as such, Harvest Vinccler is also experiencing the slow payment of invoices. During the year ended December 31, 2013, Harvest Vinccler advanced to Petrodelta $0.5 million for continuing operations costs. Petrodelta and Petrodelta’s board have not indicated that the advances are not payable, nor that they will not be paid. At December 31, 2013, we reclassified $0.8 million of the Advances to Affiliate to a long-term receivable due to slow payment and age of the advances. Although payment is slow and the balance is increasing, payments continue to be received.

Windfall Profits Tax

In April 2011, the Venezuelan government published in the Official Gazette the Law Creating a Special Contribution on Extraordinary Prices and Exorbitant Prices in the International Hydrocarbons Market (“Windfall Profits Tax”). In February 2013, the Venezuelan government published in the Official Gazette an amendment to the Windfall Profits Tax. The amended Windfall Profits Tax establishes new levels for contribution of extraordinary and exorbitant prices to the Venezuelan government. Extraordinary prices are considered to be equal to or lower than $80 per barrel, and exorbitant prices are considered to be over $80 per barrel.

Royalty Cap

Royalties are paid at 33.33 percent with the 30 percent royalty paid in kind and the 3.33 percent royalty paid in cash. The amended Windfall Profits Tax also sets a new royalty cap per barrel of $80 ($70 per barrel in 2012). The law does not specify whether the cap on royalties is applicable to royalties paid in-cash, in-kind, or both. Per instructions received from PDVSA, Petrodelta reports royalties, whether paid in-cash or in-kind, at $80 per barrel (royalty barrels x $80). Per our interpretation of the Windfall Profits Tax law and as required under U.S. GAAP, the $80 cap on royalty barrels should only be applied to the 3.33 percent royalty which Petrodelta pays in cash. The revenues and royalties in the table above have been adjusted to report royalties paid in-kind at the oil price applicable for the period. For the year ended December 31, 2013, the reduction to oil sales due to the $80 cap applied to all royalty barrels was $38.4 million ($12.1 million net to our percent interest for the period) ($113.7 million [$36.4 million net to our 32 percent interest] and $85.0 million [$27.2 million net to our 32 percent interest] for the years ended December 31, 2012 and 2011, respectively). While both methods of reporting result in the same amount being reported for net sales, our method results in prices per barrel of oil which are consistent with the prices expected under the Sales Contract.

Functional Currency

Petrodelta’s functional and reporting currency is the U.S. Dollar. PPSA is obligated to make payment to Petrodelta in U.S. Dollars in the case of payment for crude oil and natural gas liquids delivered. In addition, major contracts for capital expenditures and lease operating expenditures are denominated in U.S. Dollars. Any dividend paid by Petrodelta will be made in U.S. Dollars.

Petrodelta has currency exchange risk from fluctuations of the official prevailing exchange rate that applies to their operating costs denominated in Venezuela Bolivars (“Bolivars”). The monetary assets that are exposed to exchange rate fluctuations are cash, accounts receivable, prepaid expenses and other current assets. The monetary liabilities that are exposed to exchange rate fluctuations are accounts payable, accruals, current and deferred income tax and other tax obligations and other current liabilities. All monetary assets and liabilities incurred at the official Bolivar exchange rate are settled at the official Bolivar exchange rate. The official prevailing currency exchange rate was increased from 4.3 Bolivars per U.S. Dollar to 6.3 Bolivars per U.S. Dollar in February 2013. Petrodelta reflected a gain of approximately $169.6 million on revaluation of its non-income tax related assets and liabilities during the year ended December 31, 2013 primarily related to the February 2013 devaluation.

As a result of legislation enacted in December 2013 and January and February of 2014, Venezuela now has a multiple exchange rate system. Most of Petrodelta’s transactions are subject to a fixed official exchange rate of 6.3. In addition, there is a variable official exchange rate system in which the exchange rate is determined through auctions (11.3 rate as of December 31, 2013). The third system is not yet available as the government has not yet specified the scope of application and mechanics. The financial information is prepared using the official fixed exchange rate (6.3 from February 2013 through December 2013). At December 31, 2013, the balances in Petrodelta’s Bolivar denominated monetary assets and liabilities accounts that are exposed to exchange rate changes are 1,011 million Bolivars and 6,683 million Bolivars, respectively.

Petrodelta’s results were also impacted by PDVSA changing its policy with respect to invoicing for disbursements made in Bolivars on behalf of Petrodelta to require that such invoices be denominated in U.S. dollars rather than Bolivars. This change was implemented in the fourth quarter of 2013 with retroactive application to certain transactions occurring in 2011 and thereafter. As a result of this change, Petrodelta recorded a $14.2 million foreign currency loss in the three months ended December 31, 2013.

Collective Labor Agreement

On February 11, 2014, the Collective Labor Agreement for the period from October 1, 2013 thru October 1, 2015, between the employees of the oil industry represented by the Venezuelan Unitary Federation of workers of the oil, gas, and derivatives (FUTPV) and PDVSA was signed. The Collective Labor Agreement establishes a salary raise and payroll and retirement benefits which has a significant impact on Petrodelta’s payroll cost. The most significant impact is a step increase of salary around 90%, where 59% is to be retroactive from October 1, 2013, then a 23% raise from May 1, 2014 and finally the remaining portion to be adjusted on January 1, 2015.

Dividends

On November 12, 2010, Petrodelta’s board of directors declared a dividend of $30.6 million, $12.2 million net to HNR Finance. Petrodelta shareholder approval of the dividend was received on March 14, 2011. Due to Petrodelta’s liquidity constraints caused by PDVSA’s insufficient monetary support and contractual adherence, as of May 2, 2012, this dividend has not been received, although it is due and payable. Petrodelta’s board of directors declared this dividend and has never indicated that the dividend is not payable, nor that it will not be paid. The dividend receivable is classified as a long-term receivable at December 31, 2013 and 2012 due to the uncertainty in the timing of payment. There is uncertainty with respect to the timing of the receipt of this dividend and whether future dividends will be declared and/or paid. During the term of the Share Purchase Agreement, Harvest Holding may not pay any dividends to HNR Energia, and therefore would not benefit from any dividends paid by Petrodelta during this period. Should this receivable be paid and subsequently distributed to Harvest Holding’s shareholders prior to the second closing sale to Petroandina, we would not receive any portion of the dividend.

Fusion Geophysical, LLC (“Fusion”)

On January 28, 2011, Fusion Geophysical, LLC’s (“Fusion”) 69 percent owned subsidiary, FusionGeo, Inc., was acquired by a private purchaser pursuant to an Agreement and Plan of Merger. We received $1.4 million for our equity investment.

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Venezuela - Other

12 Months Ended

Dec. 31, 2013

Text Block [Abstract]

Venezuela - Other

Note 7 – Venezuela – Other

See also Note 6 – Investment in Equity Affiliates, Venezuela – Petrodelta, S.A. for further information regarding our Venezuela operations.

Harvest Vinccler’s functional and reporting currency is the U.S. Dollar. They do not have currency exchange risk other than the official prevailing exchange rate that applies to their operating costs denominated in Venezuela Bolivars (“Bolivars”). During the year ended December 31, 2013, Harvest Vinccler exchanged approximately $1.6 million ($1.5 million during the year ended December 31, 2012) and received an average exchange rate of 6.9 Bolivars (5.16 Bolivars during the year ended December 31, 2012) per U.S. Dollar.

The monetary assets that are exposed to exchange rate fluctuations are cash, accounts receivable, prepaid expenses and other current assets. The monetary liabilities that are exposed to exchange rate fluctuations are accounts payable, accruals, current and deferred income tax and other tax obligations and other current liabilities. All monetary assets and liabilities incurred at the official Bolivar exchange rate are settled at the official Bolivar exchange rate. At December 31, 2013, the balances in Harvest Vinccler’s Bolivar denominated monetary assets and liabilities accounts that are exposed to exchange rate changes are 10.2 million Bolivars and 7.2 million Bolivars, respectively. Therefore a change in the exchange rate is not expected to have a material impact on results of operations or our financial position.

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Indonesia

12 Months Ended

Dec. 31, 2013

Text Block [Abstract]

Indonesia

Note 9 – Indonesia

In 2007, we entered into a Farmout Agreement to acquire a 47 percent interest in the Budong PSC located mostly onshore West Sulawesi, Indonesia. In April 2008, the Government of Indonesia approved the assignment to us of the 47 percent interest in the Budong PSC. Our partner is the operator through the exploration phase as required by the terms of the Budong PSC, and we have an option to become operator, if approved by the Government of Indonesia and SKK Migas in any subsequent development and production phase.

We acquired our original 47 percent interest in the Budong PSC by committing to fund the first phase of the exploration program up to a cap of $17.2 million, including the acquisition of 2-D seismic and drilling of the first two exploration wells under a Farmout Agreement with our partner in the Budong PSC. Prior to drilling the first exploration well, our partner had a one-time option to increase the level of the carried interest to a maximum of $20.0 million. On September 15, 2010, our partner exercised their option to increase the carry obligation by $2.7 million to a total of $19.9 million. The additional carry increased our ownership by 7.4 percent to 54.4 percent. On March 3, 2011, the Government of Indonesia approved this change in ownership interest.

On January 14, 2011, we exercised our first refusal right to a proposed transfer of interest by the operator to a third party, which allowed us to acquire an additional 10 percent ownership in the Budong PSC at a cost of $3.7 million payable ten business days after completion of the first exploration well. The $3.7 million was paid on April 18, 2011. Closing of this acquisition increased our participating ownership interest in the Budong PSC to 64.4 percent with our cost sharing interest becoming 64.51 percent until first commercial production. On August 11, 2011, the Government of Indonesia approved this change in ownership interest.

The initial exploration term of the Budong PSC was due to expire on January 15, 2013. In September 2012, the operator of the Budong PSC, on behalf of us and the other co-venturer, submitted a request to BPMIGAS under the terms of the Budong PSC for a four-year extension of the initial six-year exploration term of the Budong PSC. In January 2013, we received written approval from SKK Migas of the four-year extension of the initial six-year exploration term.

In November 2012, the Indonesia constitutional court declared BPMIGAS, Indonesia’s oil and gas regulatory authority, to be unconstitutional. In January 2013, SKK Migas, the Special Task Force for oil and gas upstream sector, was formed to replace BPMIGAS.

In December 2012, we signed a farmout agreement with the operator of the Budong PSC to acquire an additional 7.1 percent participating interest and to become operator of the Budong PSC. We assumed the role of operator effective March 25, 2013. Closing of this acquisition on April 22, 2013 increased our participating ownership interest in the Budong PSC to 71.5 percent with our cost sharing interest becoming 72 percent until first commercial production. The consideration for this transaction is that we will fund 100 percent of the costs of the first exploration well of the four-year extension to the Budong PSC. If the exploration well is not drilled by October 2014 (within 18 months of the date of approval from the Government of Indonesia of this transaction), our partner has the right to give us notice that the consideration for the additional 7.1 percent participating interest must be paid in cash for $3.2 million.

We have satisfied all work commitments for the current exploration phase of the Budong PSC. However, the extension of the initial exploration term includes an exploration well, which if not drilled by January 2016, results in the termination of the Budong PSC.

During the initial exploration period, the Budong PSC covered 1.35 million acres. The Budong PSC includes a ten-year exploration period and a 20-year development phase. Pursuant to the terms of the Budong PSC, at the end of the first three-year exploration phase, 45 percent of the original area was to be relinquished to SKK Migas. In January 2010, 35 percent of the original area was relinquished and ten percent of the required relinquishment was deferred until 2011. In January 2011, the deferred ten percent of the original total contract area was relinquished to SKK Migas. The Budong PSC currently covers 0.75 million acres. However, pursuant to the request for extension of the initial exploration term, the contract area held by the Budong PSC at the beginning of the extension period should be reduced, per the terms of the Budong PSC, from the current 55 percent to 20 percent of the original contract area. If the full amount of the required relinquishment is required, 0.3 million acres would remain in the Budong PSC contract area. In January 2013, our partner, on our behalf, submitted a relinquishment proposal of 10 percent to SKK Migas. The retained area will contain all the areas of geological interest to the Budong PSC partners.

Operational activities during 2012 focused on a review of geological and geophysical data obtained from the drilling of LG-1 and KD-1 wells to upgrade the prospectivity of the block and to define a prospect for potential drilling in 2013. We have completed remapping of both the Lariang and Karama Basins with eight leads in the Lariang Basin and five leads in the Karama Basin having been identified. The identification of these leads is the basis for the four-year extension request of the first six-year exploration term.

Operational activities during 2013 included continued work on an exploration program targeting the Pliocene and Miocene targets encountered in the previous two wells. Land access and acquisition; environmental studies; construction and upgrades to access roads, bridges, and well site; permitting; and tender prequalification and procurement are on-going.

We are actively discussing the sale of our interests in Budong, and based on indications of interest received in December 2013, we determined that is it was appropriate to recognize an impairment expense of $0.6 million and a charge included in general and administrative expenses related to a valuation allowance on VAT we do not expect to recover of $2.8 million. The Budong PSC represents $4.6 million of unproved oil and gas properties including inventory on our December 31, 2013 balance sheet ($5.3 million at December 31, 2012).

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Warrant Derivative Liabilities - Additional Information (Detail) (USD $) In Millions, except Share data, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012	Nov. 30, 2010
Line of Credit Facility [Line Items]
Warrants outstanding	2,513,000
Loan facility amount	$ 60
Fair value of warrants per warrant	$ 1.07	$ 3.18
Minimum [Member]
Line of Credit Facility [Line Items]
Direct or indirect owner voting power of the outstanding common stock	50.00%
Term Loan Facility [Member]
Line of Credit Facility [Line Items]
Warrants outstanding	1,826,001	1,720,334
Loan facility amount			$ 60

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Stock-Based Compensation and Stock Purchase Plans - Stock Appreciation Rights - Additional Information (Detail) (Stock Appreciation Rights (SARs) [Member], USD $) In Millions, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Schedule Of Share Based Compensation Arrangements [Line Items]
Option vesting period	3 years
Exercisable SARs		74,997	83,000
Weighted-average exercise price of SARs exercisable	$ 4.91	$ 4.60	$ 4.60
Granted, Shares	213,996	707,202	0
Number of options issued	250,000
Options issued, exercise price	$ 10.8
Consecutive trading days for options to vest	10 days
Percent of fair market value of Company's common stock on exercise date less exercise price of $10.80	100.00%
Intrinsic value	$ 0	$ 0.3	$ 0
Total fair value of awards vested	0.8	0.3	0.2
Unrecognized compensation cost	$ 1.2
Expected weighted average period of recognizing compensation cost	1 year 9 months 18 days
Minimum [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Average closing price of common stock	$ 25

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Warrant Derivative Liabilities - Income (Loss) Associated with Changes in Fair Values of Our Warrant Derivative Financial Instruments (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Derivative Instruments, Gain (Loss) [Line Items]
Unrealized gain (loss) on warrant derivatives	$ 3,517	$ (600)	$ 9,786
Warrants derivative liabilities [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Unrealized gain (loss) on warrant derivatives	$ 3,517	$ (600)

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Debt - Principal Payment Requirements on Long-Term Debt Outstanding (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013
Debt Disclosure [Abstract]
2014	$ 79,750
Total	$ 79,750

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Operating Segments - Segment Income (Loss) Attributable to Harvest (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended								12 Months Ended
	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Segment Reporting Information [Line Items]
Net income (loss) from continuing operations									$ (83,946)	$ 2,199	$ (30,285)
Discontinued operations	(1,073)	(2,586)	(1,006)	(485)	(6,472)	(347)	(2,164)	(5,427)	(5,150)	(14,410)	86,245
Net income (loss) attributable to Harvest	(122,680)	1,953	(4,466)	36,097	(23,147)	5,751	6,225	(1,040)	(89,096)	(12,211)	55,960
Venezuela [Member]
Segment Reporting Information [Line Items]
Net income (loss) from continuing operations									58,640	51,584	54,974
Gabon [Member]
Segment Reporting Information [Line Items]
Net income (loss) from continuing operations									(12,908)	(2,902)	(6,158)
Indonesia [Member]
Segment Reporting Information [Line Items]
Net income (loss) from continuing operations									(9,213)	(4,052)	(45,416)
United States [Member]
Segment Reporting Information [Line Items]
Net income (loss) from continuing operations									$ (120,465)	$ (42,431)	$ (33,685)

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Taxes (Tables)

12 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

Tax Effects of Significant Items of Deferred Income Taxes

The tax effects of significant items comprising our net deferred income taxes are as follows:

	As of December 31,
	2013						2012
	Foreign			United States And Other			Foreign			United States And Other
	(in thousands)
Deferred tax assets:
Operating loss carryforwards	$	58,051		$	2,928		$	54,231		$	4,498
Stock-based compensation		—			8,056			—			8,091
Accrued compensation		—			598			—			739
Oil and gas properties		1,606			1,015			—			—
Alternative minimum tax credit		—			4,501			—			2,261
Other		—			145			—			861
Total deferred tax assets		59,657			17,243			54,231			16,450
Deferred tax liabilities:
Tax on unremitted earnings of foreign subsidiaries		—			(89,900	)		—			—
Accrued income		—			—			(1,005	)		—
Prepaids		—			(198	)		—			(373	)
Other liabilities		—			(82	)		—			(35	)
Fixed assets		—			(12	)		—			(28	)
Total deferred tax liabilities		—			(90,192	)		(1,005	)		(436	)
Net deferred tax asset (liability)		59,657			(72,949	)		53,226			16,014
Valuation allowance		(59,576	)		—			(52,427	)		(15,992	)
Net deferred tax asset (liability) after valuation allowance	$	81		$	(72,949	)	$	799		$	22

Components of Loss from Continuing Operations Before Income Taxes

The components of loss from continuing operations before income taxes are as follows:

	Year Ended December 31,
	2013			2012			2011
	(in thousands)
Loss before income taxes
United States	$	(31,072	)	$	(33,841	)	$	(30,309	)
Foreign		(40,725	)		(18,915	)		(58,193	)
Total	$	(71,797	)	$	(52,756	)	$	(88,502	)

Provision (Benefit) for Income Taxes on Continuing Operations

The provision (benefit) for income taxes on continuing operations consisted of the following at December 31:

	Year Ended December 31,
	2013			2012			2011
	(in thousands)
Current:
United States	$	2,279		$	(717	)	$	—
Foreign		44			929			3,693
		2,323			212			3,693
Deferred:
United States		72,971			(22	)		—
Foreign		(2,207	)		(799	)		(2,636	)
		70,764			(821	)		(2,636	)
	$	73,087		$	(609	)	$	1,057

Income Tax Expense (Benefit) on Continuing Operations at Federal Statutory Rate

A comparison of the income tax expense (benefit) on continuing operations at the federal statutory rate to our provision for income taxes is as follows:

	Year Ended December 31,
	2013			2012			2011
	(in thousands)
Income tax expense (benefit) from continuing operations:
Tax expense (benefit) at U.S. statutory rate	$	(25,129	)	$	(17,938	)	$	(30,805	)
Effect of foreign source income and rate differentials on foreign income		204			239			4,887
Tax gain associated with sale of interest in Harvest Holding		7,474			—			—
Subpart F income		16,615			—			—
Tax on unremitted earnings of foreign subsidiaries		89,900			—			—
Expired losses		1,356			—			—
Other changes in valuation allowance		(10,643	)		10,331			28,169
Change in applicable statutory rate		(404	)		—			—
Other permanent differences		(2,546	)		1,431			—
Return to accrual and other true-ups		2,919			1,257			—
Debt exchange		—			2,758			—
Warrant derivatives		(1,180	)		—			(1,445	)
Liability for uncertain tax positions		(5,553	)		799			237
Other		74			514			14
Total income tax expense – continuing operations		73,087			(609	)		1,057
Income tax expense (benefit) from discontinued operations:
Total income tax expense (benefit) – discontinued operations		—			—			5,748
Total income tax expense (benefit)	$	73,087		$	(609	)	$	6,805

Net Operating Losses Available for Carryforward

At December 31, 2013, we have the following net operating losses available for carryforward (in thousands):

United States	$	8,364	Available for up to 20 years from 2012
Indonesia		54,435	Available for up to 5 years from 2011
Gabon		23,268	Available for up to 3 years from 2010
Oman		25,174	Available for up to 5 years from 2009
The Netherlands		109,634	Available for up to 9 years from 2007
Venezuela		3,043	Available for up to 3 years from 2010
Colombia		1,214	Available indefinitely

Primary Income Tax Jurisdictions and their Respective Audit Years

Our primary income tax jurisdictions and their respective open audit years are:

Tax Jurisdiction	Open Audit Years
United States	2010 – 2013
The Netherlands	2010 – 2013
Singapore	2009 – 2013
United Kingdom	2012 – 2013
Venezuela	2009 – 2013
Colombia	2013

Unrecognized Tax Benefits

A reconciliation of the beginning amount, and current year additions, of unrecognized tax benefits follows:

	Year Ended December 31,
	2013			2012
	(in thousands)
Balance at beginning of year	$	5,871		$	5,072
Additions for tax positions of prior years		—			799
Reductions for tax positions of prior years		(5,553	)		—
Balance at end of year	$	318		$	5,871

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Dispositions - Additional Information (Detail) (USD $)	1 Months Ended	12 Months Ended				0 Months Ended	12 Months Ended			12 Months Ended		0 Months Ended		12 Months Ended
	Feb. 28, 2013	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012 Block 64 EPSA [Member]	May 17, 2011 Antelope Project [Member]	Dec. 31, 2013 Antelope Project [Member]	Dec. 31, 2012 Antelope Project [Member]	Dec. 31, 2011 Antelope Project [Member]	Dec. 31, 2013 Petroandina [Member]	Dec. 31, 2013 Harvest Vinccler S.C.A. [Member]	Dec. 16, 2013 Petrodelta, S.A. [Member]	Dec. 16, 2013 Harvest Holding [Member]	Dec. 31, 2013 Harvest Holding [Member] First Closing [Member]	Dec. 16, 2013 Harvest Holding [Member] First Closing [Member]	Dec. 16, 2013 Harvest Holding [Member] Second Closing [Member]	Dec. 16, 2013 Harvest Holding [Member] Petroandina [Member]	Dec. 16, 2013 Harvest Holding [Member] Harvest Vinccler S.C.A. [Member]
Discontinued Operations [Line Items]
Cash purchase price for share purchase agreement													$ 400,000,000		$ 125,000,000	$ 275,000,000
Percentage of equity interest											100.00%		80.00%		29.00%	51.00%
Loss on Sale of Interest in Harvest holding														23,000,000
Percentage of noncontrolling interest													49.00%				29.00%	20.00%
Partner interest in equity method investee												60.00%
Termination payment fees		3,000,000								9,600,000
Share purchase agreement expenses, maximum										4,000,000
Impaired carrying value					6,400,000
Farm-out agreement, working interest percentage	75.00%
Partners carried interest for the minimum exploratory work commitment	25.00%
Impairment expense		575,000	2,900,000	3,335,000
Settlement cost		2,000,000
Proceeds from sale of projects						217,800,000
Closed transaction to sell							May 17, 2011
Effective date of sale							Mar. 01, 2011
Expense related to settlement of royalty payments								100,000
Write-offs of notes receivable								5,200,000
Accounts payable - carry obligation								3,600,000
Accrued interest with note receivable									$ 3,300,000

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Taxes

12 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

Taxes

Note 14 – Taxes

Taxes on Income

The tax effects of significant items comprising our net deferred income taxes are as follows:

	As of December 31,
	2013						2012
	Foreign			United States And Other			Foreign			United States And Other
	(in thousands)
Deferred tax assets:
Operating loss carryforwards	$	58,051		$	2,928		$	54,231		$	4,498
Stock-based compensation		—			8,056			—			8,091
Accrued compensation		—			598			—			739
Oil and gas properties		1,606			1,015			—			—
Alternative minimum tax credit		—			4,501			—			2,261
Other		—			145			—			861
Total deferred tax assets		59,657			17,243			54,231			16,450
Deferred tax liabilities:
Tax on unremitted earnings of foreign subsidiaries		—			(89,900	)		—			—
Accrued income		—			—			(1,005	)		—
Prepaids		—			(198	)		—			(373	)
Other liabilities		—			(82	)		—			(35	)
Fixed assets		—			(12	)		—			(28	)
Total deferred tax liabilities		—			(90,192	)		(1,005	)		(436	)
Net deferred tax asset (liability)		59,657			(72,949	)		53,226			16,014
Valuation allowance		(59,576	)		—			(52,427	)		(15,992	)
Net deferred tax asset (liability) after valuation allowance	$	81		$	(72,949	)	$	799		$	22

After assessing the possible actions which management may take in 2014 and the next few years, as discussed further below, during the year ended December 31, 2013, we recognized a deferred tax liability of $89.9 million related to income tax on undistributed earnings for foreign subsidiaries.

Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets (“DTAs”). A significant piece of objective negative evidence evaluated was the cumulative losses incurred in our foreign operating entities over the three-year period ended December 31, 2013. Such objective evidence limits the ability to consider other subjective evidence such as our projections for future growth. We have therefore placed a valuation allowance (“VA”) on all of our foreign DTAs with the exception of $0.1 million related to NOL carryforwards in Venezuela which would be realized upon settlement of uncertain tax positions.

Management also reviewed the earnings history of our U.S. operations and determined that, while the Company does not have domestic production, it is expected to have sufficient taxable income in the U.S. related to the expected sale of the remaining equity interest in Harvest Holding. This is expected to allow the Company the ability to utilize the benefits related to its deferred tax assets which previously had a valuation allowance. As such, the Company has released the valuation allowances on the U.S. deferred tax assets.

The components of loss from continuing operations before income taxes are as follows:

	Year Ended December 31,
	2013			2012			2011
	(in thousands)
Loss before income taxes
United States	$	(31,072	)	$	(33,841	)	$	(30,309	)
Foreign		(40,725	)		(18,915	)		(58,193	)
Total	$	(71,797	)	$	(52,756	)	$	(88,502	)

The provision (benefit) for income taxes on continuing operations consisted of the following at December 31:

	Year Ended December 31,
	2013			2012			2011
	(in thousands)
Current:
United States	$	2,279		$	(717	)	$	—
Foreign		44			929			3,693
		2,323			212			3,693
Deferred:
United States		72,971			(22	)		—
Foreign		(2,207	)		(799	)		(2,636	)
		70,764			(821	)		(2,636	)
	$	73,087		$	(609	)	$	1,057

A comparison of the income tax expense (benefit) on continuing operations at the federal statutory rate to our provision for income taxes is as follows:

	Year Ended December 31,
	2013			2012			2011
	(in thousands)
Income tax expense (benefit) from continuing operations:
Tax expense (benefit) at U.S. statutory rate	$	(25,129	)	$	(17,938	)	$	(30,805	)
Effect of foreign source income and rate differentials on foreign income		204			239			4,887
Tax gain associated with sale of interest in Harvest Holding		7,474			—			—
Subpart F income		16,615			—			—
Tax on unremitted earnings of foreign subsidiaries		89,900			—			—
Expired losses		1,356			—			—
Other changes in valuation allowance		(10,643	)		10,331			28,169
Change in applicable statutory rate		(404	)		—			—
Other permanent differences		(2,546	)		1,431			—
Return to accrual and other true-ups		2,919			1,257			—
Debt exchange		—			2,758			—
Warrant derivatives		(1,180	)		—			(1,445	)
Liability for uncertain tax positions		(5,553	)		799			237
Other		74			514			14
Total income tax expense – continuing operations		73,087			(609	)		1,057
Income tax expense (benefit) from discontinued operations:
Total income tax expense (benefit) – discontinued operations		—			—			5,748
Total income tax expense (benefit)	$	73,087		$	(609	)	$	6,805

Rate differentials for foreign income result from tax rates different from the U.S. tax rate being applied in foreign jurisdictions.

At December 31, 2013, we have the following net operating losses available for carryforward (in thousands):

United States	$	8,364	Available for up to 20 years from 2012
Indonesia		54,435	Available for up to 5 years from 2011
Gabon		23,268	Available for up to 3 years from 2010
Oman		25,174	Available for up to 5 years from 2009
The Netherlands		109,634	Available for up to 9 years from 2007
Venezuela		3,043	Available for up to 3 years from 2010
Colombia		1,214	Available indefinitely

As a result of the first closing sale to Petroandina, the Company realized a tax gain of $47.5 million which is included in U.S. taxable income pursuant to the provisions of the Internal Revenue Code. The Company utilized $10.8 million of available losses from prior years as well as a current year tax loss of $36.7 million to offset income resulting from the sale resulting in no regular tax for the year ended December 31, 2013 leaving $8.4 million of losses available to offset taxable income in future periods. However, as a result of the alternative minimum tax provisions, we did incur AMT of $2.1 million increasing the amount of the AMT credit carryforward.

During the year, the Company released $5.6 million from our reserve for uncertain tax positions. This was primarily related to resolution of a Dutch tax issue regarding treatment of certain costs charged to our Dutch affiliate. However, a portion of this amount was offset by an adjustment to the valuation allowance, resulting in a net impact of $2.2 million.

If the U.S. operating loss carryforwards are ultimately realized, there would be no amounts credited to additional paid in capital for tax benefits associated with deductions for income tax purposes related to stock options and convertible debt.

Accumulated Undistributed Earnings of Foreign Subsidiaries

As of December 31, 2013, the book-tax outside basis difference in our foreign subsidiary resulting from unremitted earnings was approximately $334.8 million. Prior to 2013, no U.S. taxes had been recorded on these earnings as it was our practice and intention to reinvest the earnings of our non-U.S. subsidiaries in those operations.

Under ASC 740-30-25-17, no deferred tax liability must be recorded if sufficient evidence shows that the subsidiary has invested or will invest the undistributed earnings or that the earnings will be remitted in a tax-free manner. Management must consider numerous factors in determining timing and amounts of possible future distribution of these earnings to the parent company and whether a U.S. deferred tax liability should be recorded for these earnings. These factors include the future operating and capital requirements of both the parent company and the subsidiaries, remittance restrictions imposed by foreign governments or financial agreements and tax consequences of the remittance, including possible application of U.S. foreign tax credits and limitations on foreign tax credits that may be imposed by the Internal Revenue Code and regulations.

During the fourth quarter of 2013, management evaluated numerous factors related to the timing and amounts of possible future distribution of these earnings to the parent company, with consideration of the pending sale of the remaining equity interest in Harvest Holding as well as possible sales of other non-U.S. assets. While we will continue to invest the undistributed earnings to the extent possible and operate the Company’s business in the normal course, management is also considering distributions to the Company’s shareholders which could include the distribution of proceeds from the sales of assets by the Company’s foreign subsidiaries to the U.S. parent company resulting in U.S. taxable income. Because management is pursuing various alternatives, a determination was made that it was appropriate to record a deferred tax liability associated with the unremitted earnings of our foreign subsidiaries of $89.9 million in the fourth quarter of 2013. This liability includes $51.1 million which could become payable currently upon the sale of the remaining interest in Harvest Holding and is therefore reflected as a current deferred tax liability.

Accounting for Uncertainty in Income Taxes

The FASB issued ASC 740-10 (prior authoritative literature: Financial Interpretation No. [“FIN”] 48, “Accounting for Uncertainty in Income Taxes – An Interpretation of FASB Statement No. 109 [“FIN 48”]) to create a single model to address accounting for uncertainty in tax positions. FIN 48 clarifies the accounting for income taxes, by prescribing a minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. FIN 48 also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition.

We or one of our subsidiaries file income tax returns in the U.S. federal jurisdiction, and various states and foreign jurisdictions. With few exceptions, we are no longer subject to U.S. federal, state and local tax examinations by tax authorities for years before 2009. Our primary income tax jurisdictions and their respective open audit years are:

Tax Jurisdiction	Open Audit Years
United States	2010 – 2013
The Netherlands	2010 – 2013
Singapore	2009 – 2013
United Kingdom	2012 – 2013
Venezuela	2009 – 2013
Colombia	2013

In January 2014, the IRS began an audit of our tax returns for 2011 and 2012.

A reconciliation of the beginning amount, and current year additions, of unrecognized tax benefits follows:

	Year Ended December 31,
	2013			2012
	(in thousands)
Balance at beginning of year	$	5,871		$	5,072
Additions for tax positions of prior years		—			799
Reductions for tax positions of prior years		(5,553	)		—
Balance at end of year	$	318		$	5,871

The release of the reserve for uncertain tax positions of $5.6 million during the year ended December 31, 2013 is primarily related to the resolution of a Dutch tax matter regarding treatment of certain costs charged to our Dutch affiliate. However, a portion of this amount was offset by an adjustment to the valuation allowance resulting in a net tax benefit of $2.2 million. If the above tax benefits were recognized, the full amount would affect the effective tax rate. We have accrued interest of $0.0 million, and penalty of $0.1 million. We believe that it is likely that remaining amount for the uncertain tax position will be resolved within the next twelve months, and the amount of unrecognized tax benefits will significantly decrease.

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Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Principles of Consolidation

Principles of Consolidation

The consolidated financial statements include the accounts of all wholly-owned and majority-owned subsidiaries. All intercompany profits, transactions and balances have been eliminated. Third-party interests in our majority-owned subsidiaries are presented as noncontrolling interests.

Presentation of Comprehensive Income (Loss)

Presentation of Comprehensive Income (Loss)

We adopted ASU No. 2011-05 (ASU 2011-05), which is included in ASC 220, “Comprehensive Income”, effective January 1, 2012 and have elected to utilize the “single continuous statement” for presentation of all nonowner changes in stockholders’ equity.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles in the United States (“USGAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Reporting and Functional Currency

Reporting and Functional Currency

The United States Dollar (“U.S. Dollar”) is the reporting and functional currency for all of our controlled subsidiaries and Petrodelta. Amounts denominated in non-U.S. Dollar currencies are re-measured into U.S. Dollars, and all currency gains or losses are recorded in the consolidated statements of operations and comprehensive income (loss). There are many factors that affect foreign exchange rates and the resulting exchange gains and losses, many of which are beyond our influence.

See Note 6 – Investment in Equity Affiliates and Note 7 – Venezuela for a discussion of currency exchange rates and currency exchange risk on Petrodelta’s and Harvest Vinccler’s businesses.

Cash and Cash Equivalents

Cash and Cash Equivalents

Cash equivalents include money market funds and short term certificates of deposit with original maturity dates of less than three months.

Restricted Cash

Restricted Cash

Restricted cash is classified as current or non-current based on the terms of the agreement. Restricted cash at December 31, 2013 represents cash held in a U.S. bank used as collateral for a customs bond for the Dussafu PSC. Restricted cash at December 31, 2012 represents cash held in a U.S. bank used as collateral for a standby letter of credit issued in support of a performance bond for a joint study.

Financial Instruments

Financial Instruments

Financial instruments, which potentially subject us to concentrations of credit risk, are primarily cash and cash equivalents, accounts receivable, dividend receivable, notes payable and derivative financial instruments. We maintain cash and cash equivalents in bank deposit accounts with commercial banks with high credit ratings, which, at times may exceed the federally insured limits. We have not experienced any losses from such investments. Concentrations of credit risk with respect to accounts receivable are limited due the nature of our receivables, which include primarily income tax receivables. In the normal course of business, collateral is not required for financial instruments with credit risk.

Investment in Equity Affiliates

Investment in Equity Affiliates

We evaluate our investments in unconsolidated companies under ASC 323, “Investments – Equity Method and Joint Ventures.” Investments in which we have significant influence are accounted for under the equity method of accounting. Under the equity method, Investment in Equity Affiliates is increased by additional investments and earnings and decreased by dividends and losses.

We review our Investment in Equity Affiliates for impairment whenever events and circumstances indicate a loss in investment value is other than a temporary decline. There are many factors to consider when evaluating an equity investment for possible impairment. Currency devaluations, inflationary economies, and cash flow analysis are some of the factors we consider in our evaluation for possible impairment. At December 31, 2013, we reviewed our investment in Petrodelta taking into consideration the terms of the Share Purchase Agreement (see Note 5 – Dispositions, Share Purchase Agreement). The purchase price under the Share Purchase Agreement indicates a valuation that approximates the carrying value of our equity investment in Petrodelta, the dividend receivable and the advances to this equity affiliate. As such, we concluded that there was no impairment to our equity investment as of December 31, 2013. If the sale of the remaining 51 percent interest in Harvest Holding is completed, we expect to recognize a gain on the transaction.

We measure and disclose our noncontrolling interests in accordance with the provisions of ASC 810 “Consolidation”. Our noncontrolling interests relate to interests in Harvest Holding held by Petroandina (29 percent) and Vinccler (20 percent) (see Note 1 – Organization).

Oil and Gas Proper

Oil and Gas Properties

The major components of property and equipment are as follows (in thousands):

	As of December 31,
	2013			2012
Unproved property costs	$	103,917		$	78,453
Oilfield inventories		4,096			3,339
Other administrative property		2,710			2,954
Total property and equipment		110,723			84,746
Accumulated depreciation		(2,332	)		(2,210	)
Total property and equipment, net	$	108,391		$	82,536

Property and equipment are stated at cost less accumulated depletion, depreciation and amortization (“DD&A”). Costs of improvements that appreciably improve the efficiency or productive capacity of existing properties or extend their lives are capitalized. Maintenance and repairs are expensed as incurred. Upon retirement or sale, the cost of property and equipment, net of the related accumulated DD&A, is removed and, if appropriate, gains or losses are recognized in investment earnings and other. We did not record any depletion expense in the years ended December 31, 2013 and 2012 or 2011 as there was no production related to proved oil and gas properties other than properties classified as held for sale.

We follow the successful efforts method of accounting for our oil and gas properties. Under this method, exploration costs such as exploratory geological and geophysical costs, delay rentals and exploration overhead are charged against earnings as incurred. Costs of drilling exploratory wells are capitalized pending determination of whether proved reserves can be attributed to the area as a result of drilling the well. If management determines that proved reserves, as that term is defined in Securities and Exchange Commission (“SEC”) regulations, have not been discovered, capitalized costs associated with the drilling of the exploratory well are charged to expense. Costs of drilling successful exploratory wells, all development wells, and related production equipment and facilities are capitalized and depleted or depreciated using the unit-of-production method as oil and gas is produced. During the year ended December 31, 2013, we expensed no dry hole costs. During the year ended December 31, 2012, we expensed to dry hole costs $0.7 million related to the drilling of Karama-1 (“KD-1”) and first sidetrack, KD-1ST, on the Budong PSC. See Note 9 – Indonesia.

Leasehold acquisition costs are initially capitalized. Acquisition costs of unproved leaseholds are assessed for impairment during the holding period. Costs of maintaining and retaining unproved leaseholds, as well as impairment of unsuccessful leases, are included in exploration expense. Impairment is based on specific identification of the lease. Costs of expired or abandoned leases are charged to exploration expense, while costs of productive leases are transferred to proved oil and gas properties.

Proved oil and gas properties are reviewed for impairment at a level for which identifiable cash flows are independent of cash flows of other assets when facts and circumstances indicate that their carrying amounts may not be recoverable. In performing this review, future net cash flows are determined based on estimated future oil and gas sales revenues less future expenditures necessary to develop and produce the reserves. If the sum of these undiscounted estimated future net cash flows is less than the carrying amount of the property, an impairment loss is recognized for the excess of the property’s carrying amount over its estimated fair value, which is generally based on discounted future net cash flows. We did not have any proved oil and gas properties in 2013, 2012 or 2011.

Costs of drilling and equipping successful exploratory wells, development wells, asset retirement liabilities and costs to construct or acquire offshore platforms and other facilities, are depleted using the unit-of-production method based on total estimated proved developed reserves. Costs of acquiring proved properties, including leasehold acquisition costs transferred from unproved leaseholds, are depleted using the unit-of-production method based on total estimated proved reserves. All other properties are stated at historical acquisition cost, net of allowance for impairment, and depreciated using the straight-line method over the useful lives of the assets.

Unproved property costs, excluding oilfield inventories, consist of (in thousands):

	As of December 31,
	2013		2012
Budong PSC	$	4,470	$	5,219
Dussafu PSC		99,447		73,234
Total unproved property costs	$	103,917	$	78,453

During the year ended December 31, 2013, we recorded impairment expense related to our Budong project in Indonesia ($0.6 million) and our project in Colombia ($3.2 million, which is reflected in discontinued operations). During the year ended December 31, 2012, we impaired the carrying value of Block 64 EPSA in Oman (which is reflected in discontinued operations) ($6.4 million) and WAB -21 in China ($2.9 million). During the year ended December 31, 2011, we impaired the carrying value of West Bay ($3.3 million).

Other Administrative Property

Other Administrative Property

Furniture, fixtures and equipment are recorded at cost and depreciated using the straight-line method over their estimated useful lives, which range from three to five years. Leasehold improvements are recorded at cost and amortized using the straight-line method over the life of the applicable lease. For the year ended December 31, 2013, depreciation expense was $0.3 million ($0.4 million and $0.4 million for the years ended December 31, 2012 and 2011, respectively).

Other Assets

Other Assets

Other assets consist of deferred financing costs, a long-term receivable for value added tax (“VAT”) credits related to the Budong PSC, and prepaid expenses which are expected to be realized in the next 12 to 24 months. Deferred financing costs relate to specific financing and are amortized over the life of the financing to which the costs relate using the interest rate method. At December 31, 2013 the deferred financing costs were reclassified to prepaid expenses in current assets (see Note 11 – Debt). The VAT receivable is reimbursed through the sale of hydrocarbons. During the year ended December 31, 2013, a valuation allowance of $2.8 million was charged to general and administrative expenses on this VAT receivable which we do not expect to recover (see Note 9 – Indonesia). Other Assets at December 31, 2013 and 2012 also includes a blocked payment of $0.7 million net to our 66.667 percent interest related to our drilling operations in Gabon in accordance with the U.S. sanctions against Libya as set forth in Executive Order 13566 of February 25, 2011, and administered by the United States Treasury Department’s Office of Foreign Assets Control (“OFAC”). See Note 13 – Commitments and Contingencies.

	As of December 31,
	2013		2012
	(in thousands)
Deferred financing costs	$	0	$	3,111
Long-term VAT receivable		0		3,440
Long-term prepaid expenses		139		328
Gabon PSC – blocked payment (net to our 66.667% interest)		734		734
	$	873	$	7,613

Reserves

Reserves

We measure and disclose our oil and gas reserves in accordance with the provisions of the SEC’s Modernization of Oil and Gas Reporting and ASC 932, “Extractive Activities – Oil and Gas” (“ASC 932”). All of our reserves are owned through our equity investment in Petrodelta. We do not have any wholly owned reserves at December 31, 2013 or 2012.

Capitalized Interest

Capitalized Interest

We capitalize interest costs for qualifying oil and gas properties. The capitalization period begins when expenditures are incurred on qualified properties, activities begin which are necessary to prepare the property for production and interest costs have been incurred. The capitalization period continues as long as these events occur. The average additions for the period are used in the interest capitalization calculation. During the year ended December 31, 2013, we capitalized interest costs for qualifying oil and gas property additions of $8.3 million ($3.0 million and $2.3 million during the years ended December 31, 2012 and 2011, respectively).

Derivative Financial Instruments

Derivative Financial Instruments

Under ASC 480 “Distinguishing Liabilities From Equity”, certain of our financial instruments with anti-dilution protection features do not meet the conditions to obtain equity classification, as there are conditions which may require settlement by transferring assets, and are required to be carried as derivative liabilities, at fair value, with changes in fair value reflected in our consolidated statements of operations and comprehensive income (loss). See Note 12 – Warrant Derivative Liabilities for additional disclosures related to the warrant derivative financial instruments issued under the warrant agreements dated November 2010 in connection with a $60 million term loan facility (the “Warrants”). In the occurrence of a fundamental change, we are required to repurchase the Warrants at the higher of (1) the fair market value of the warrant and (2) a valuation based on a computation of the option value of the Warrant using the Black-Scholes calculation method using the assumptions described in the Warrant Agreement. A fundamental change is defined as “the occurrence of one of the following events: a) a person or group becomes the direct or indirect owner of more than 50% of the voting power of the outstanding common stock, b) a merger event or similar transaction in which the majority owners before the transaction fail to own a majority of the voting power of the Company after the transaction, and c) approval of a plan of liquidation or dissolution of the Company or sale of all or substantially all of the Company’s assets.”

Fair Value Measurements

Fair Value Measurements

We measure and disclose our fair values in accordance with the provisions of ASC 820 “Fair Value Measurements and Disclosures” (“ASC 820”). ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price) and establishes a three-level hierarchy, which encourages an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of the hierarchy are defined as follows:

• Level 1 – Inputs to the valuation techniques that are quoted prices in active markets for identical assets or liabilities.

• Level 2 – Inputs to the valuation techniques that are other than quoted prices but are observable for the assets or liabilities, either directly or indirectly.

• Level 3 – Inputs to the valuation techniques that are unobservable for the assets or liabilities.

Financial instruments, which potentially subject us to concentrations of credit risk, are primarily cash and cash equivalents, accounts receivable, advances to equity affiliate, dividend receivable, long-term debt and warrant derivative liability. We maintain cash and cash equivalents in bank deposit accounts with commercial banks with high credit ratings, which, at times may exceed the federally insured limits. We have not experienced any losses from such investments. Concentrations of credit risk with respect to accounts receivable are limited due to the nature of our receivables. In the normal course of business, collateral is not required for financial instruments with credit risk.

The estimated fair value of cash, accounts receivable and accounts payable approximates their carrying value due to their short-term nature (Level 1). The estimated fair value of advances to equity affiliate and dividend receivable approximates their carrying value as it is the estimated amount we would receive from a third party to assume the receivables (Level 2). The following disclosure of the estimated fair value of financial instruments is made in accordance with the requirements of ASC 825, Financial Instruments. The estimated fair value amounts have been determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The following table presents the estimated fair values of our fixed interest rate, long-term debt instrument (Level 3), excluding the embedded derivative.

	As of December 31, 2013
	Carying    Value		Fair    Value
	(in thousands)
11% senior unsecured notes (Level 2)	$	77,480	$	79,750

As discussed in Note 11 – Debt, the 11% senior notes were redeemed at face value on January 11, 2014 following a notice of redemption issued in December 2013. Therefore, the fair value of our fixed interest debt instruments is stated at the redemption amount.

Derivative Financial Instruments

The following tables set forth by level within the fair value hierarchy our financial liabilities that were accounted for at fair value as of December 31, 2013 and 2012. As required by ASC 820, a financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of fair value liabilities and their placement within the fair value hierarchy levels. See Note 12 – Warrant Derivative Liability for a description and discussion of our warrant derivative liability and Note 11 – Debt for a description of our long-term debt embedded derivative liability as well as a description of the valuation models and inputs used to calculate the fair value of these derivative liabilities.

	As of December 31, 2013
	Level 1		Level 2		Level 3		Total
	(in thousands)
Liabilities:
Warrant derivative liability	$	0	$	0	$	1,953	$	1,953
Embedded derivative-debt		0		0		0		0
Total derivative liabilities	$	0	$	0	$	1,953	$	1,953

	As of December 31, 2012
	Level 1		Level 2		Level 3		Total
	(in thousands)
Liabilities:
Warrant derivative liability	$	0	$	0	$	5,470	$	5,470
Embedded derivative-debt		0		0		0		0
Total derivative liabilities	$	0	$	0	$	5,470	$	5,470

We record the net change in the fair value of the derivative positions listed above in unrealized gain (loss) on warrant derivative liabilities in our consolidated statements of operations and comprehensive income (loss). During the year ended December 31, 2013, an unrealized gain of $3.5 million was recorded to reflect the change in fair value of the warrants ($0.6 million unrealized loss and $9.8 million unrealized gain during the years ended December 31, 2012 and 2011, respectively).

Changes in Level 3 Instruments Measured at Fair Value on a Recurring Basis

The following table provides a reconciliation of financial liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3).

	December 31, 2013			December 31, 2012
	(in thousands)
Financial liabilities:
Beginning balance	$	5,470		$	4,870
Unrealized change in fair value		(3,517	)		600
Ending balance	$	1,953		$	5,470

During the year ended December 31, 2013, there were no transfers between Level 1, Level 2 and Level 3 liabilities.

Share-Based Compensation

Share-Based Compensation

We use a fair value based method of accounting for stock-based compensation. We utilize the Black-Scholes option pricing model to measure the fair value of stock options and stock appreciation rights (“SARs”). Restricted stock and restricted stock units (“RSUs”) are measured at their intrinsic values. See Note 15 – Stock-Based Compensations and Stock Purchase Plans.

Income Taxes

Income Taxes

Deferred income taxes reflect the net tax effects, calculated at currently enacted rates, of (a) future deductible/taxable amounts attributable to events that have been recognized on a cumulative basis in the financial statements or income tax returns, and (b) operating loss and tax credit carryforwards. A valuation allowance for deferred tax assets is recorded when it is more likely than not that the benefit from the deferred tax asset will not be realized.

We classify interest related to income tax liabilities and penalties as applicable, as interest expense.

We do not provide deferred income taxes on undistributed earnings of our foreign subsidiaries for possible future remittances where we are able to assert that such earnings are permanently reinvested, or otherwise can be negotiated in a tax free manner, as part of our ongoing business.

Valuation and Qualifying Accounts

Valuation and Qualifying Accounts

Our valuation and qualifying accounts are comprised of the deferred tax valuation allowance, investment valuation allowance and VAT receivable valuation allowance. Balances and changes in these accounts are, in thousands:

			Additions
	Balance at Beginning of Year		Charged to Income		Charged to Other Accounts*		Deductions From Reserves		Balance at End of Year
At December 31, 2013
Amounts deducted from applicable assets
Deferred tax valuation allowance	$	68,419	$	8,072	$	0	$	0	$	76,491
Investment valuation allowance		1,350								1,350
VAT receivable valuation allowance		0		2,792		0		0		2,792
At December 31, 2012
Amounts deducted from applicable assets
Deferred tax valuation allowance	$	53,116	$	15,303	$	0	$	0	$	68,419
Investment valuation allowance		1,350		0		0		0		1,350
At December 31, 2011
Amounts deducted from applicable assets
Deferred tax valuation allowance	$	46,905	$	6,211	$	0	$	0	$	53,116
Investment valuation allowance		1,350		0		0		0		1,350

* Amounts charged to other accounts include net operating losses and income tax credits.

New Accounting Pronouncements

New Accounting Pronouncements

In January 2013, Financial Accounting Standards Board (“FASB”) issued ASU No. 2013-01, which is included in ASC 210, “Balance Sheet”, “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities” (“ASU No. 2013-01”). This update clarifies that the scope of ASU 2011-11: “Disclosures about Offsetting Assets and Liabilities” applies only to derivatives accounted for under ASC 815 “Derivatives and Hedging”, included bifurcated embedded derivatives, repurchase agreements and reverse repurchase agreements, and securities lending transactions that are either offset in accordance with ASC 210-20-45 or ASC 815-10-45 or subject to an enforceable master netting arrangement or similar agreement. ASU No. 2013-01 is effective for fiscal years and interim periods within those years, beginning on or after January 1, 2013. Entities should provide the required disclosures retrospectively for all comparative periods presented. The adoption of this guidance impacted presentation disclosures only and did not have an impact on our consolidated financial position, results of operation or cash flows.

In February 2013, FASB issued ASU No. 2013-04, which is included in ASC 405, “Liabilities”, “Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation is Fixed at the Reporting Date”. This update provides guidance for the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of the obligation with the scope of this guidance is fixed at the reporting date, except for obligations addressed within existing guidance in USGAAP. Examples of obligations within the scope to ASU No. 2013-04 include debt arrangements, other contractual obligations, and settled litigation and judicial rulings. ASU No. 2013-04 is effective for fiscal years and interim periods within those years beginning after December 5, 2013. Entities should provide the required disclosures retrospectively for all comparative periods presented. We are currently evaluating the impact of this guidance, but we expect that the adoption of this guidance will impact presentation disclosures only and will not have an impact on our consolidated financial position, results of operation or cash flows.

In July 2013, FASB issued ASU No. 2013-11 which is included in ASC 740 “Income Taxes”, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” This update provides guidance regarding the presentation of unrecognized tax benefits when net operating loss carryforward, a similar tax loss, or a tax credit carryforward are not available at the reporting date to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose. In such instances, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The amendment should be applied prospectively to all unrecognized tax benefits that exist at the effective date; however, retrospective application is permitted. The amendment is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. We are currently evaluating the impact of this guidance, but we expect that the adoption of this guidance will impact presentation disclosures only and will not have an impact on our consolidated financial position, results of operation or cash flows.

Accounting for Uncertainty in Income Taxes

Accounting for Uncertainty in Income Taxes

The FASB issued ASC 740-10 (prior authoritative literature: Financial Interpretation No. [“FIN”] 48, “Accounting for Uncertainty in Income Taxes – An Interpretation of FASB Statement No. 109 [“FIN 48”]) to create a single model to address accounting for uncertainty in tax positions. FIN 48 clarifies the accounting for income taxes, by prescribing a minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. FIN 48 also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition.

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Summarized Quarterly Financial Data (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended								12 Months Ended
	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Quarterly Financial Information Disclosure [Abstract]
Expenses	$ (21,096)	$ (9,516)	$ (9,653)	$ (5,171)	$ (16,167)	$ (6,694)	$ (7,837)	$ (8,128)	$ (45,436)	$ (38,826)	$ (77,155)
Non-operating loss	(19,577)	(7,764)	(1,273)	2,253	(6,832)	(1,734)	(3,085)	(2,279)
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES	(40,673)	(17,280)	(10,926)	(2,918)	(22,999)	(8,428)	(10,922)	(10,407)	(71,797)	(52,756)	(88,502)
Income tax expense (benefit)	75,228	(765)	(1,415)	39	(90)	1,723	(1,022)	(1,220)	(73,087)	609	(1,057)
Loss from continuing operations	(115,901)	(16,515)	(9,511)	(2,957)	(22,909)	(10,151)	(9,900)	(9,187)	(144,884)	(52,147)	(89,559)
Earnings (loss) from equity affiliate	(10,242)	25,747	7,602	49,471	7,745	20,299	22,829	16,896	72,578	67,769	73,451
Income (loss) from continuing operations	(126,143)	9,232	(1,909)	46,514	(15,164)	10,148	12,929	7,709	(72,306)	15,622	(16,108)
Discontinued operations	(1,073)	(2,586)	(1,006)	(485)	(6,472)	(347)	(2,164)	(5,427)	(5,150)	(14,410)	86,245
Net income (loss)	(127,216)	6,646	(2,915)	46,029	(21,636)	9,801	10,765	2,282	(77,456)	1,212	70,137
Less: net income (loss) attributable to noncontrolling interest	(4,536)	4,693	1,551	9,932	1,511	4,050	4,540	3,322	(11,640)	(13,423)	(14,177)
Net income (loss) attributable to Harvest	$ (122,680)	$ 1,953	$ (4,466)	$ 36,097	$ (23,147)	$ 5,751	$ 6,225	$ (1,040)	$ (89,096)	$ (12,211)	$ 55,960
BASIC EARNINGS (LOSS) PER SHARE:
Income (loss) from continuing operations	$ (2.99)	$ 0.12	$ (0.09)	$ 0.93	$ (0.43)	$ 0.16	$ 0.23	$ 0.13	$ (2.12)	$ 0.06	$ (0.89)
Discontinued operations	$ (0.03)	$ (0.07)	$ (0.03)	$ (0.01)	$ (0.16)	$ (0.01)	$ (0.06)	$ (0.16)	$ (0.13)	$ (0.39)	$ 2.53
Net income (loss) attributable to Harvest	$ (3.02)	$ 0.05	$ (0.12)	$ 0.92	$ (0.59)	$ 0.15	$ 0.17	$ (0.03)	$ (2.25)	$ (0.33)	$ 1.64
DILUTED EARNINGS (LOSS) PER SHARE:
Income (loss) from continuing operations	$ (2.99)	$ 0.12	$ (0.09)	$ 0.92	$ (0.43)	$ 0.16	$ 0.21	$ 0.12	$ (2.12)	$ 0.06	$ (0.89)
Discontinued operations	$ (0.03)	$ (0.07)	$ (0.03)	$ (0.01)	$ (0.16)	$ (0.01)	$ (0.06)	$ (0.14)	$ (0.13)	$ (0.39)	$ 2.53
Net income (loss) attributable to Harvest	$ (3.02)	$ 0.05	$ (0.12)	$ 0.91	$ (0.59)	$ 0.15	$ 0.15	$ (0.02)	$ (2.25)	$ (0.33)	$ 1.64

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Earning Per Share - Earning Per Share (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended								12 Months Ended
	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Earnings Per Share [Abstract]
Income (loss) from continuing operations									$ (83,946)	$ 2,199	$ (30,285)
Discontinued operations	(1,073)	(2,586)	(1,006)	(485)	(6,472)	(347)	(2,164)	(5,427)	(5,150)	(14,410)	86,245
NET INCOME (LOSS) ATTRIBUTABLE TO HARVEST [COMPREHENSIVE INCOME (LOSS)]	$ (122,680)	$ 1,953	$ (4,466)	$ 36,097	$ (23,147)	$ 5,751	$ 6,225	$ (1,040)	$ (89,096)	$ (12,211)	$ 55,960
Weighted average common shares outstanding									39,579	37,424	34,117
Effect of dilutive securities									0	167	0
Weighted average common shares, diluted									39,579	37,591	34,117
Basic Earnings Per Share:
Income from continuing operations	$ (2.99)	$ 0.12	$ (0.09)	$ 0.93	$ (0.43)	$ 0.16	$ 0.23	$ 0.13	$ (2.12)	$ 0.06	$ (0.89)
Discontinued operations	$ (0.03)	$ (0.07)	$ (0.03)	$ (0.01)	$ (0.16)	$ (0.01)	$ (0.06)	$ (0.16)	$ (0.13)	$ (0.39)	$ 2.53
Basic earnings per share	$ (3.02)	$ 0.05	$ (0.12)	$ 0.92	$ (0.59)	$ 0.15	$ 0.17	$ (0.03)	$ (2.25)	$ (0.33)	$ 1.64
Diluted Earnings Per Share:
Income from continuing operations	$ (2.99)	$ 0.12	$ (0.09)	$ 0.92	$ (0.43)	$ 0.16	$ 0.21	$ 0.12	$ (2.12)	$ 0.06	$ (0.89)
Discontinued operations	$ (0.03)	$ (0.07)	$ (0.03)	$ (0.01)	$ (0.16)	$ (0.01)	$ (0.06)	$ (0.14)	$ (0.13)	$ (0.39)	$ 2.53
Diluted earnings per share	$ (3.02)	$ 0.05	$ (0.12)	$ 0.91	$ (0.59)	$ 0.15	$ 0.15	$ (0.02)	$ (2.25)	$ (0.33)	$ 1.64

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Summary of Significant Accounting Policies - Major Components of Property and Equipment (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Property Plant And Equipment Useful Life And Values [Abstract]
Unproved property costs	$ 103,917	$ 78,453
Oilfield inventories	4,096	3,339
Other administrative property	2,710	2,954
Total property and equipment	110,723	84,746
Accumulated depreciation	(2,332)	(2,210)
TOTAL PROPERTY AND EQUIPMENT, NET	$ 108,391	$ 82,536

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (USD $) In Thousands, unless otherwise specified	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Treasury Stock [Member]	Noncontrolling Interest [Member]
Beginning Balance at Dec. 31, 2010	$ 361,228	$ 401	$ 219,240	$ 137,629	$ (65,543)	$ 69,501
Beginning Balance, Shares at Dec. 31, 2010		40,103
Issuance of common shares:
Exercise of stock options	924	2	922	0	0	0
Exercise of stock options, shares		167
Restricted stock awards	2,030	2	2,028	0	0	0
Restricted stock awards, Shares		273
Employee stock-based compensation	2,611	0	2,611	0	0	0
Conversion of 8.25% senior convertible notes	465	1	464	0	0	0
Conversion of 8.25% senior convertible notes, Shares		82
Purchase of treasury shares	(561)	0	0	0	(561)	0
Tax benefits related to equity compensation	2,535	0	2,535	0	0	0
Dividend to noncontrolling interest owner	0
Net income	70,137	0	0	55,960	0	14,177
Ending Balance at Dec. 31, 2011	439,369	406	227,800	193,589	(66,104)	83,678
Ending Balance, Shares at Dec. 31, 2011		40,625
Issuance of common shares:
Exercise of stock options	719	1	718	0	0	0
Exercise of stock options, shares		122
Restricted stock awards	1,566	2	1,564	0	0	0
Restricted stock awards, Shares		203
Employee stock-based compensation	1,934	0	1,934	0	0	0
Conversion of 8.25% senior convertible notes	29,107	49	29,058	0	0	0
Conversion of 8.25% senior convertible notes, Shares		4,932
Warrants issued	2,572	0	2,572	0	0	0
Purchase of treasury shares	(41)	0	0	0	(41)	0
Dividend to noncontrolling interest owner	0
Net income	1,212	0	0	(12,211)	0	13,423
Ending Balance at Dec. 31, 2012	476,438	458	263,646	181,378	(66,145)	97,101
Ending Balance, Shares at Dec. 31, 2012		45,882
Issuance of common shares:
Exercise of stock options	122	0	122	0	0	0
Exercise of stock options, shares		20
Sales of common shares	9,298	25	9,273	0	0	0
Sales of common shares, Shares		2,495
Restricted stock awards	928	4	924	0	0
Restricted stock awards, Shares		269
Employee stock-based compensation	2,118	0	2,118	0	0	0
Purchase of treasury shares	(77)	0	0	0	(77)	0
Increase in equity held by noncontrolling interests due to sale of interest in affiliate	144,796					144,796
Dividend to noncontrolling interest owner	(10,370)	0	0	0	0	(10,370)
Net income	(77,456)	0	0	(89,096)	0	11,640
Ending Balance at Dec. 31, 2013	$ 545,797	$ 487	$ 276,083	$ 92,282	$ (66,222)	$ 243,167
Ending Balance, Shares at Dec. 31, 2013		48,666

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Stock-Based Compensation and Stock Purchase Plans - Restricted Stock Units - Additional Information (Detail) (Restricted Stock Units (RSUs) [Member], USD $) In Millions, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Schedule Of Share Based Compensation Arrangements [Line Items]
Option vesting period	3 years
Granted, Shares	190,002	388,000	0
Aggregate fair value of awards		$ 2.00
Shares settled with Company's common stock	202,668
Value of the restricted stock vested	0.8	0.4	0.6
Unrecognized compensation cost	$ 0.5
Expected weighted average period of recognizing compensation cost	1 year 3 months 18 days
Director [Member]
Schedule Of Share Based Compensation Arrangements [Line Items]
Option vesting period	1 year

XML

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Note 3 – Summary of Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of all wholly-owned and majority-owned subsidiaries. All intercompany profits, transactions and balances have been eliminated. Third-party interests in our majority-owned subsidiaries are presented as noncontrolling interests.

Presentation of Comprehensive Income (Loss)

We adopted ASU No. 2011-05 (ASU 2011-05), which is included in ASC 220, “Comprehensive Income”, effective January 1, 2012 and have elected to utilize the “single continuous statement” for presentation of all nonowner changes in stockholders’ equity.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles in the United States (“USGAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Reporting and Functional Currency

The United States Dollar (“U.S. Dollar”) is the reporting and functional currency for all of our controlled subsidiaries and Petrodelta. Amounts denominated in non-U.S. Dollar currencies are re-measured into U.S. Dollars, and all currency gains or losses are recorded in the consolidated statements of operations and comprehensive income (loss). There are many factors that affect foreign exchange rates and the resulting exchange gains and losses, many of which are beyond our influence.

See Note 6 – Investment in Equity Affiliates and Note 7 – Venezuela for a discussion of currency exchange rates and currency exchange risk on Petrodelta’s and Harvest Vinccler’s businesses.

Cash and Cash Equivalents

Cash equivalents include money market funds and short term certificates of deposit with original maturity dates of less than three months.

Restricted Cash

Restricted cash is classified as current or non-current based on the terms of the agreement. Restricted cash at December 31, 2013 represents cash held in a U.S. bank used as collateral for a customs bond for the Dussafu PSC. Restricted cash at December 31, 2012 represents cash held in a U.S. bank used as collateral for a standby letter of credit issued in support of a performance bond for a joint study.

Financial Instruments

Financial instruments, which potentially subject us to concentrations of credit risk, are primarily cash and cash equivalents, accounts receivable, dividend receivable, notes payable and derivative financial instruments. We maintain cash and cash equivalents in bank deposit accounts with commercial banks with high credit ratings, which, at times may exceed the federally insured limits. We have not experienced any losses from such investments. Concentrations of credit risk with respect to accounts receivable are limited due the nature of our receivables, which include primarily income tax receivables. In the normal course of business, collateral is not required for financial instruments with credit risk.

Investment in Equity Affiliates

We evaluate our investments in unconsolidated companies under ASC 323, “Investments – Equity Method and Joint Ventures.” Investments in which we have significant influence are accounted for under the equity method of accounting. Under the equity method, Investment in Equity Affiliates is increased by additional investments and earnings and decreased by dividends and losses.

We review our Investment in Equity Affiliates for impairment whenever events and circumstances indicate a loss in investment value is other than a temporary decline. There are many factors to consider when evaluating an equity investment for possible impairment. Currency devaluations, inflationary economies, and cash flow analysis are some of the factors we consider in our evaluation for possible impairment. At December 31, 2013, we reviewed our investment in Petrodelta taking into consideration the terms of the Share Purchase Agreement (see Note 5 – Dispositions, Share Purchase Agreement). The purchase price under the Share Purchase Agreement indicates a valuation that approximates the carrying value of our equity investment in Petrodelta, the dividend receivable and the advances to this equity affiliate. As such, we concluded that there was no impairment to our equity investment as of December 31, 2013. If the sale of the remaining 51 percent interest in Harvest Holding is completed, we expect to recognize a gain on the transaction.

We measure and disclose our noncontrolling interests in accordance with the provisions of ASC 810 “Consolidation”. Our noncontrolling interests relate to interests in Harvest Holding held by Petroandina (29 percent) and Vinccler (20 percent) (see Note 1 – Organization).

Oil and Gas Properties

The major components of property and equipment are as follows (in thousands):

	As of December 31,
	2013			2012
Unproved property costs	$	103,917		$	78,453
Oilfield inventories		4,096			3,339
Other administrative property		2,710			2,954
Total property and equipment		110,723			84,746
Accumulated depreciation		(2,332	)		(2,210	)
Total property and equipment, net	$	108,391		$	82,536

Property and equipment are stated at cost less accumulated depletion, depreciation and amortization (“DD&A”). Costs of improvements that appreciably improve the efficiency or productive capacity of existing properties or extend their lives are capitalized. Maintenance and repairs are expensed as incurred. Upon retirement or sale, the cost of property and equipment, net of the related accumulated DD&A, is removed and, if appropriate, gains or losses are recognized in investment earnings and other. We did not record any depletion expense in the years ended December 31, 2013 and 2012 or 2011 as there was no production related to proved oil and gas properties other than properties classified as held for sale.

We follow the successful efforts method of accounting for our oil and gas properties. Under this method, exploration costs such as exploratory geological and geophysical costs, delay rentals and exploration overhead are charged against earnings as incurred. Costs of drilling exploratory wells are capitalized pending determination of whether proved reserves can be attributed to the area as a result of drilling the well. If management determines that proved reserves, as that term is defined in Securities and Exchange Commission (“SEC”) regulations, have not been discovered, capitalized costs associated with the drilling of the exploratory well are charged to expense. Costs of drilling successful exploratory wells, all development wells, and related production equipment and facilities are capitalized and depleted or depreciated using the unit-of-production method as oil and gas is produced. During the year ended December 31, 2013, we expensed no dry hole costs. During the year ended December 31, 2012, we expensed to dry hole costs $0.7 million related to the drilling of Karama-1 (“KD-1”) and first sidetrack, KD-1ST, on the Budong PSC. SeeNote 9 – Indonesia.

Leasehold acquisition costs are initially capitalized. Acquisition costs of unproved leaseholds are assessed for impairment during the holding period. Costs of maintaining and retaining unproved leaseholds, as well as impairment of unsuccessful leases, are included in exploration expense. Impairment is based on specific identification of the lease. Costs of expired or abandoned leases are charged to exploration expense, while costs of productive leases are transferred to proved oil and gas properties.

Proved oil and gas properties are reviewed for impairment at a level for which identifiable cash flows are independent of cash flows of other assets when facts and circumstances indicate that their carrying amounts may not be recoverable. In performing this review, future net cash flows are determined based on estimated future oil and gas sales revenues less future expenditures necessary to develop and produce the reserves. If the sum of these undiscounted estimated future net cash flows is less than the carrying amount of the property, an impairment loss is recognized for the excess of the property’s carrying amount over its estimated fair value, which is generally based on discounted future net cash flows. We did not have any proved oil and gas properties in 2013, 2012 or 2011.

Costs of drilling and equipping successful exploratory wells, development wells, asset retirement liabilities and costs to construct or acquire offshore platforms and other facilities, are depleted using the unit-of-production method based on total estimated proved developed reserves. Costs of acquiring proved properties, including leasehold acquisition costs transferred from unproved leaseholds, are depleted using the unit-of-production method based on total estimated proved reserves. All other properties are stated at historical acquisition cost, net of allowance for impairment, and depreciated using the straight-line method over the useful lives of the assets.

Unproved property costs, excluding oilfield inventories, consist of (in thousands):

	As of December 31,
	2013		2012
Budong PSC	$	4,470	$	5,219
Dussafu PSC		99,447		73,234
Total unproved property costs	$	103,917	$	78,453

During the year ended December 31, 2013, we recorded impairment expense related to our Budong project in Indonesia ($0.6 million) and our project in Colombia ($3.2 million, which is reflected in discontinued operations). During the year ended December 31, 2012, we impaired the carrying value of Block 64 EPSA in Oman (which is reflected in discontinued operations) ($6.4 million) and WAB -21 in China ($2.9 million). During the year ended December 31, 2011, we impaired the carrying value of West Bay ($3.3 million).

Other Administrative Property

Furniture, fixtures and equipment are recorded at cost and depreciated using the straight-line method over their estimated useful lives, which range from three to five years. Leasehold improvements are recorded at cost and amortized using the straight-line method over the life of the applicable lease. For the year ended December 31, 2013, depreciation expense was $0.3 million ($0.4 million and $0.4 million for the years ended December 31, 2012 and 2011, respectively).

Other Assets

Other assets consist of deferred financing costs, a long-term receivable for value added tax (“VAT”) credits related to the Budong PSC, and prepaid expenses which are expected to be realized in the next 12 to 24 months. Deferred financing costs relate to specific financing and are amortized over the life of the financing to which the costs relate using the interest rate method. At December 31, 2013 the deferred financing costs were reclassified to prepaid expenses in current assets (see Note 11 – Debt). The VAT receivable is reimbursed through the sale of hydrocarbons. During the year ended December 31, 2013, a valuation allowance of $2.8 million was charged to general and administrative expenses on this VAT receivable which we do not expect to recover (see Note 9 – Indonesia). Other Assets at December 31, 2013 and 2012 also includes a blocked payment of $0.7 million net to our 66.667 percent interest related to our drilling operations in Gabon in accordance with the U.S. sanctions against Libya as set forth in Executive Order 13566 of February 25, 2011, and administered by the United States Treasury Department’s Office of Foreign Assets Control (“OFAC”). See Note 13 – Commitments and Contingencies.

	As of December 31,
	2013		2012
	(in thousands)
Deferred financing costs	$	0	$	3,111
Long-term VAT receivable		0		3,440
Long-term prepaid expenses		139		328
Gabon PSC – blocked payment (net to our 66.667% interest)		734		734
	$	873	$	7,613

Reserves

We measure and disclose our oil and gas reserves in accordance with the provisions of the SEC’s Modernization of Oil and Gas Reporting and ASC 932, “Extractive Activities – Oil and Gas” (“ASC 932”). All of our reserves are owned through our equity investment in Petrodelta. We do not have any wholly owned reserves at December 31, 2013 or 2012.

Capitalized Interest

We capitalize interest costs for qualifying oil and gas properties. The capitalization period begins when expenditures are incurred on qualified properties, activities begin which are necessary to prepare the property for production and interest costs have been incurred. The capitalization period continues as long as these events occur. The average additions for the period are used in the interest capitalization calculation. During the year ended December 31, 2013, we capitalized interest costs for qualifying oil and gas property additions of $8.3 million ($3.0 million and $2.3 million during the years ended December 31, 2012 and 2011, respectively).

Derivative Financial Instruments

Under ASC 480 “Distinguishing Liabilities From Equity”, certain of our financial instruments with anti-dilution protection features do not meet the conditions to obtain equity classification, as there are conditions which may require settlement by transferring assets, and are required to be carried as derivative liabilities, at fair value, with changes in fair value reflected in our consolidated statements of operations and comprehensive income (loss). See Note 12 – Warrant Derivative Liabilities for additional disclosures related to the warrant derivative financial instruments issued under the warrant agreements dated November 2010 in connection with a $60 million term loan facility (the “Warrants”). In the occurrence of a fundamental change, we are required to repurchase the Warrants at the higher of (1) the fair market value of the warrant and (2) a valuation based on a computation of the option value of the Warrant using the Black-Scholes calculation method using the assumptions described in the Warrant Agreement. A fundamental change is defined as “the occurrence of one of the following events: a) a person or group becomes the direct or indirect owner of more than 50% of the voting power of the outstanding common stock, b) a merger event or similar transaction in which the majority owners before the transaction fail to own a majority of the voting power of the Company after the transaction, and c) approval of a plan of liquidation or dissolution of the Company or sale of all or substantially all of the Company’s assets.”

Fair Value Measurements

We measure and disclose our fair values in accordance with the provisions of ASC 820 “Fair Value Measurements and Disclosures” (“ASC 820”). ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price) and establishes a three-level hierarchy, which encourages an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of the hierarchy are defined as follows:

• Level 1 – Inputs to the valuation techniques that are quoted prices in active markets for identical assets or liabilities.

• Level 2 – Inputs to the valuation techniques that are other than quoted prices but are observable for the assets or liabilities, either directly or indirectly.

• Level 3 – Inputs to the valuation techniques that are unobservable for the assets or liabilities.

Financial instruments, which potentially subject us to concentrations of credit risk, are primarily cash and cash equivalents, accounts receivable, advances to equity affiliate, dividend receivable, long-term debt and warrant derivative liability. We maintain cash and cash equivalents in bank deposit accounts with commercial banks with high credit ratings, which, at times may exceed the federally insured limits. We have not experienced any losses from such investments. Concentrations of credit risk with respect to accounts receivable are limited due to the nature of our receivables. In the normal course of business, collateral is not required for financial instruments with credit risk.

The estimated fair value of cash, accounts receivable and accounts payable approximates their carrying value due to their short-term nature (Level 1). The estimated fair value of advances to equity affiliate and dividend receivable approximates their carrying value as it is the estimated amount we would receive from a third party to assume the receivables (Level 2). The following disclosure of the estimated fair value of financial instruments is made in accordance with the requirements of ASC 825, Financial Instruments. The estimated fair value amounts have been determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The following table presents the estimated fair values of our fixed interest rate, long-term debt instrument (Level 2), excluding the embedded derivative.

	As of December 31, 2013
	Carying    Value		Fair    Value
	(in thousands)
11% senior unsecured notes (Level 2)	$	77,480	$	79,750

As discussed in Note 11 – Debt, the 11% senior notes were redeemed at face value on January 11, 2014 following a notice of redemption issued in December 2013. Therefore, the fair value of our fixed interest debt instruments is stated at the redemption amount.

Derivative Financial Instruments

The following tables set forth by level within the fair value hierarchy our financial liabilities that were accounted for at fair value as of December 31, 2013 and 2012. As required by ASC 820, a financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of fair value liabilities and their placement within the fair value hierarchy levels. See Note 12 – Warrant Derivative Liability for a description and discussion of our warrant derivative liability and Note 11 – Debt for a description of our long-term debt embedded derivative liability as well as a description of the valuation models and inputs used to calculate the fair value of these derivative liabilities.

	As of December 31, 2013
	Level 1		Level 2		Level 3		Total
	(in thousands)
Liabilities:
Warrant derivative liability	$	0	$	0	$	1,953	$	1,953
Embedded derivative-debt		0		0		0		0
Total derivative liabilities	$	0	$	0	$	1,953	$	1,953

	As of December 31, 2012
	Level 1		Level 2		Level 3		Total
	(in thousands)
Liabilities:
Warrant derivative liability	$	0	$	0	$	5,470	$	5,470
Embedded derivative-debt		0		0		0		0
Total derivative liabilities	$	0	$	0	$	5,470	$	5,470

We record the net change in the fair value of the derivative positions listed above in unrealized gain (loss) on warrant derivative liabilities in our consolidated statements of operations and comprehensive income (loss). During the year ended December 31, 2013, an unrealized gain of $3.5 million was recorded to reflect the change in fair value of the warrants ($0.6 million unrealized loss and $9.8 million unrealized gain during the years ended December 31, 2012 and 2011, respectively).

Changes in Level 3 Instruments Measured at Fair Value on a Recurring Basis

The following table provides a reconciliation of financial liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3).

	December 31, 2013			December 31, 2012
	(in thousands)
Financial liabilities:
Beginning balance	$	5,470		$	4,870
Unrealized change in fair value		(3,517	)		600
Ending balance	$	1,953		$	5,470

During the year ended December 31, 2013, there were no transfers between Level 1, Level 2 and Level 3 liabilities.

Share-Based Compensation

We use a fair value based method of accounting for stock-based compensation. We utilize the Black-Scholes option pricing model to measure the fair value of stock options and stock appreciation rights (“SARs”). Restricted stock and restricted stock units (“RSUs”) are measured at their intrinsic values. See Note 15 – Stock-Based Compensations and Stock Purchase Plans.

Income Taxes

Deferred income taxes reflect the net tax effects, calculated at currently enacted rates, of (a) future deductible/taxable amounts attributable to events that have been recognized on a cumulative basis in the financial statements or income tax returns, and (b) operating loss and tax credit carryforwards. A valuation allowance for deferred tax assets is recorded when it is more likely than not that the benefit from the deferred tax asset will not be realized.

We classify interest related to income tax liabilities and penalties as applicable, as interest expense.

We do not provide deferred income taxes on undistributed earnings of our foreign subsidiaries for possible future remittances where we are able to assert that such earnings are permanently reinvested, or otherwise can be negotiated in a tax free manner, as part of our ongoing business.

Valuation and Qualifying Accounts

Our valuation and qualifying accounts are comprised of the deferred tax valuation allowance, investment valuation allowance and VAT receivable valuation allowance. Balances and changes in these accounts are, in thousands:

			Additions
	Balance at Beginning of Year		Charged to Income		Charged to Other Accounts		Deductions From Reserves Credited to Income			Balance at End of Year
At December 31, 2013
Amounts deducted from applicable assets
Deferred tax valuation allowance	$	68,419	$	0	$	0	$	(8,843	)	$	59,576
Investment valuation allowance		1,350		0		0		0			1,350
VAT receivable valuation allowance		0		2,792		0		0			2,792
At December 31, 2012
Amounts deducted from applicable assets
Deferred tax valuation allowance	$	53,116	$	15,303	$	0	$	0		$	68,419
Investment valuation allowance		1,350		0		0		0			1,350
At December 31, 2011
Amounts deducted from applicable assets
Deferred tax valuation allowance	$	46,905	$	6,211	$	0	$	0		$	53,116
Investment valuation allowance		1,350		0		0		0			1,350

New Accounting Pronouncements

In January 2013, Financial Accounting Standards Board (“FASB”) issued ASU No. 2013-01, which is included in ASC 210, “Balance Sheet”, “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities” (“ASU No. 2013-01”). This update clarifies that the scope of ASU 2011-11: “Disclosures about Offsetting Assets and Liabilities” applies only to derivatives accounted for under ASC 815 “Derivatives and Hedging”, included bifurcated embedded derivatives, repurchase agreements and reverse repurchase agreements, and securities lending transactions that are either offset in accordance with ASC 210-20-45 or ASC 815-10-45 or subject to an enforceable master netting arrangement or similar agreement. ASU No. 2013-01 is effective for fiscal years and interim periods within those years, beginning on or after January 1, 2013. Entities should provide the required disclosures retrospectively for all comparative periods presented. The adoption of this guidance impacted presentation disclosures only and did not have an impact on our consolidated financial position, results of operation or cash flows.

In February 2013, FASB issued ASU No. 2013-04, which is included in ASC 405, “Liabilities”, “Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation is Fixed at the Reporting Date”. This update provides guidance for the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of the obligation with the scope of this guidance is fixed at the reporting date, except for obligations addressed within existing guidance in USGAAP. Examples of obligations within the scope to ASU No. 2013-04 include debt arrangements, other contractual obligations, and settled litigation and judicial rulings. ASU No. 2013-04 is effective for fiscal years and interim periods within those years beginning after December 15, 2013. Entities should provide the required disclosures retrospectively for all comparative periods presented. We are currently evaluating the impact of this guidance, but we expect that the adoption of this guidance will impact presentation disclosures only and will not have an impact on our consolidated financial position, results of operation or cash flows.

In July 2013, FASB issued ASU No. 2013-11 which is included in ASC 740 “Income Taxes”, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” This update provides guidance regarding the presentation of unrecognized tax benefits when net operating loss carryforward, a similar tax loss, or a tax credit carryforward are not available at the reporting date to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose. In such instances, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The amendment should be applied prospectively to all unrecognized tax benefits that exist at the effective date; however, retrospective application is permitted. The amendment is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. We are currently evaluating the impact of this guidance, but we expect that the adoption of this guidance will impact presentation disclosures only and will not have an impact on our consolidated financial position, results of operation or cash flows.

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Gabon - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	1 Months Ended	12 Months Ended
	Feb. 28, 2013	Dec. 31, 2013 Sqkms ft	Dec. 31, 2013 Dussafu PSC [Member] sqmi acre ft	Dec. 31, 2012 Dussafu PSC [Member]
Capitalized Costs of Unproved Properties Excluded from Amortization [Line Items]
Ownership percentage held by wholly owned subsidiary	75.00%		66.667%
Area covered by acquiree entity			680,000
Area covered by acquiree entity under water depths			1,650
Extended period of third exploration phase		4 years
Third exploration phase extension date		May 27, 2016
Processing of seismic		545
Depth of well		11,385
Acquisition of land as part of seismic acquisition survey			1,260
Oil and gas properties			$ 103.4	$ 76.4

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Stock-Based Compensation and Stock Purchase Plans - Summary of Unvested Stock Option Awards (Detail) (Options [Member], USD $)	12 Months Ended
	Dec. 31, 2013
Options [Member]
Summary of unvested stock option awards
Unvested Outstanding, shares, beginning balance	1,380,000
Outstanding Granted, shares	920,000
Outstanding Vested, shares	(452,000)
Outstanding Forfeited, shares	(20,000)
Unvested Outstanding, shares, ending balance	1,828,000
Unvested Outstanding, Weighted-Average Grant - Date Fair Value, beginning balance	$ 4.88
Granted, Weighted-Average Grant - Date Fair Value	$ 3.06
Vested, Weighted-Average Grant - Date Fair Value	$ (4.27)
Forfeited, Weighted-Average Grant - Date Fair Value	$ (3.04)
Unvested Outstanding, Weighted-Average Grant - Date Fair Value, ending balance	$ 4.14

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Taxes - Tax Effects of Significant Items of Deferred Income Taxes (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Deferred tax assets:
Alternative minimum tax credit	$ 2,100
Deferred tax liabilities:
Tax on unremitted earnings of foreign subsidiaries	(89,900)
Foreign [Member]
Deferred tax assets:
Operating loss carryforwards	58,051	54,231
Oil and gas properties	1,606
Total deferred tax assets	59,657	54,231
Deferred tax liabilities:
Accrued income		(1,005)
Total deferred tax liabilities		(1,005)
Net deferred tax asset (liability)	59,657	53,226
Valuation allowance	(59,576)	(52,427)
Net deferred tax asset (liability) after valuation allowance	81	799
United States And Other [Member]
Deferred tax assets:
Operating loss carryforwards	2,928	4,498
Stock-based compensation	8,056	8,091
Accrued compensation	598	739
Oil and gas properties	1,015
Alternative minimum tax credit	4,501	2,261
Other	145	861
Total deferred tax assets	17,243	16,450
Deferred tax liabilities:
Tax on unremitted earnings of foreign subsidiaries	(89,900)
Prepaids	(198)	(373)
Other liabilities	(82)	(35)
Fixed assets	(12)	(28)
Total deferred tax liabilities	(90,192)	(436)
Net deferred tax asset (liability)	(72,949)	16,014
Valuation allowance		(15,992)
Net deferred tax asset (liability) after valuation allowance	$ (72,949)	$ 22

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Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Major Components of Property and Equipment

The major components of property and equipment are as follows (in thousands):

	As of December 31,
	2013			2012
Unproved property costs	$	103,917		$	78,453
Oilfield inventories		4,096			3,339
Other administrative property		2,710			2,954
Total property and equipment		110,723			84,746
Accumulated depreciation		(2,332	)		(2,210	)
Total property and equipment, net	$	108,391		$	82,536

Unproved Property Costs, Excluding Oilfield Inventories

Unproved property costs, excluding oilfield inventories, consist of (in thousands):

	As of December 31,
	2013		2012
Budong PSC	$	4,470	$	5,219
Dussafu PSC		99,447		73,234
Total unproved property costs	$	103,917	$	78,453

Schedule of Other Assets

	As of December 31,
	2013		2012
	(in thousands)
Deferred financing costs	$	0	$	3,111
Long-term VAT receivable		0		3,440
Long-term prepaid expenses		139		328
Gabon PSC – blocked payment (net to our 66.667% interest)		734		734
	$	873	$	7,613

Summary of Estimated Fair Values of Fixed Interest Rate, Long-term Debt Instrument

The following table presents the estimated fair values of our fixed interest rate, long-term debt instrument (Level 3), excluding the embedded derivative.

	As of December 31, 2013
	Carying    Value		Fair    Value
	(in thousands)
11% senior unsecured notes (Level 2)	$	77,480	$	79,750

Fair Value of Liabilities and Their Placement With in Fair Value Hierarchy Levels

The following tables set forth by level within the fair value hierarchy our financial liabilities that were accounted for at fair value as of December 31, 2013 and 2012. As required by ASC 820, a financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of fair value liabilities and their placement within the fair value hierarchy levels. See Note 12 – Warrant Derivative Liability for a description and discussion of our warrant derivative liability and Note 11 – Debt for a description of our long-term debt embedded derivative liability as well as a description of the valuation models and inputs used to calculate the fair value of these derivative liabilities.

	As of December 31, 2013
	Level 1		Level 2		Level 3		Total
	(in thousands)
Liabilities:
Warrant derivative liability	$	0	$	0	$	1,953	$	1,953
Embedded derivative-debt		0		0		0		0
Total derivative liabilities	$	0	$	0	$	1,953	$	1,953

	As of December 31, 2012
	Level 1		Level 2		Level 3		Total
	(in thousands)
Liabilities:
Warrant derivative liability	$	0	$	0	$	5,470	$	5,470
Embedded derivative-debt		0		0		0		0
Total derivative liabilities	$	0	$	0	$	5,470	$	5,470

Schedule of Reconciliation of Financial Liabilities Measured at Fair Value on Recurring Basis Using Significant Unobservable Inputs (Level 3)

The following table provides a reconciliation of financial liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3).

	December 31, 2013			December 31, 2012
	(in thousands)
Financial liabilities:
Beginning balance	$	5,470		$	4,870
Unrealized change in fair value		(3,517	)		600
Ending balance	$	1,953		$	5,470

Schedule of Valuation and Qualifying Accounts

Our valuation and qualifying accounts are comprised of the deferred tax valuation allowance, investment valuation allowance and VAT receivable valuation allowance. Balances and changes in these accounts are, in thousands:

			Additions
	Balance at Beginning of Year		Charged to Income		Charged to Other Accounts		Deductions From Reserves Credited to Income			Balance at End of Year
At December 31, 2013
Amounts deducted from applicable assets
Deferred tax valuation allowance	$	68,419	$	0	$	0	$	(8,843	)	$	59,576
Investment valuation allowance		1,350		0		0		0			1,350
VAT receivable valuation allowance		0		2,792		0		0			2,792
At December 31, 2012
Amounts deducted from applicable assets
Deferred tax valuation allowance	$	53,116	$	15,303	$	0	$	0		$	68,419
Investment valuation allowance		1,350		0		0		0			1,350
At December 31, 2011
Amounts deducted from applicable assets
Deferred tax valuation allowance	$	46,905	$	6,211	$	0	$	0		$	53,116
Investment valuation allowance		1,350		0		0		0			1,350

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Taxes - Net Operating Losses Available for Carryforward (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013
United States [Member]
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards	$ 8,364
Net operating losses available for carryforward	Available for up to 20 years from 2012
Indonesia [Member]
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards	54,435
Net operating losses available for carryforward	Available for up to 5 years from 2011
Gabon [Member]
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards	23,268
Net operating losses available for carryforward	Available for up to 3 years from 2010
Oman [Member]
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards	25,174
Net operating losses available for carryforward	Available for up to 5 years from 2009
The Netherlands [Member]
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards	109,634
Net operating losses available for carryforward	Available for up to 9 years from 2007
Venezuela [Member]
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards	3,043
Net operating losses available for carryforward	Available for up to 3 years from 2010
Colombia [Member]
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards	$ 1,214
Net operating losses available for carryforward	Available indefinitely

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Organization - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	0 Months Ended	12 Months Ended	0 Months Ended	12 Months Ended							0 Months Ended		0 Months Ended	12 Months Ended				0 Months Ended	12 Months Ended
	Dec. 16, 2013 Closings	Dec. 31, 2013	Dec. 16, 2013 Petrodelta, S.A. [Member]	Dec. 31, 2013 Petrodelta, S.A. [Member]	Dec. 31, 2012 Petrodelta, S.A. [Member]	Dec. 31, 2011 Petrodelta, S.A. [Member]	Dec. 31, 2013 Petrodelta, S.A. [Member] Corporacion Venezolana del Petroleo S.A. [Member]	Dec. 31, 2013 Petrodelta, S.A. [Member] PDVSA Social S.A. [Member]	Dec. 31, 2013 Petroleos de Venezuela S.A. [Member] CVP and PDVSA Social S.A. [Member]	Dec. 31, 2013 Harvest Vinccler S.C.A. [Member]	Dec. 16, 2013 Harvest Holding [Member]	Dec. 31, 2013 Harvest Holding [Member] Closings	Dec. 31, 2013 Harvest Holding [Member] Petrodelta, S.A. [Member]	Dec. 16, 2013 Harvest Holding [Member] Petrodelta, S.A. [Member]	Dec. 31, 2013 Harvest Holding [Member] Petrodelta, S.A. [Member]	Dec. 16, 2013 Harvest Holding [Member] Harvest Vinccler S.C.A. [Member]	Dec. 16, 2013 Harvest Holding [Member] Petroandina [Member]	Dec. 16, 2013 Oil & Gas Technology Consultants [Member] Closings	Dec. 31, 2013 Oil & Gas Technology Consultants [Member]	Dec. 16, 2013 Oil & Gas Technology Consultants [Member] Harvest Vinccler S.C.A. [Member]	Dec. 16, 2013 Oil & Gas Technology Consultants [Member] Petroandina [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Interest indirectly owned in Harvest Holding											80.00%				80.00%			80.00%	51.00%
Interest indirectly owned by Oil & Gas Technology Consultants in Harvest Holding																		20.00%
Aggregate cash purchase price	$ 400																	$ 400
Interest held in Petrodelta by Harvest Holding				40.00%											40.00%			80.00%
Number of closings of Equity interest	2											2						2
Sale of equity interest in Harvest Holding on first closing																		29.00%
Cost of Sale of Equity interest																		125
Loss on Sale of Interest in Harvest holding																			$ 23.0
Percentage hold by non controlling interest											49.00%					20.00%	29.00%	49.00%		20.00%	29.00%
Partner interest in equity method investee			60.00%				56.00%	4.00%
Percentage of interest owned by PDVSA in CVP									100.00%
Indirect interest held in Petrodelta by HNR		20.40%			32.00%	32.00%							20.40%	32.00%	51.00%
Equity ownership percentage										100.00%	80.00%

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Commitments and Contingencies

12 Months Ended

Dec. 31, 2013

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 13 – Commitments and Contingencies

We have employment contracts with five executive officers which provide for annual base salaries, eligibility for bonus compensation and various benefits. The contracts provide for a lump sum payment as a multiple of base salary in the event of termination of employment without cause. In addition, these contracts provide for payments as a multiple of base salary and bonus, excise tax reimbursement, outplacement services and a continuation of benefits in the event of termination without cause following a change in control. By providing one year notice, these agreements may be terminated by either party on or after May 31, 2013.

We have regional/technical offices in Singapore and field offices in Jakarta, Indonesia and Port Gentil, Gabon to support field operations in those areas. At December 31, 2013 we had the following lease commitments for office space (in thousands):

	Payments Due by Period
	Total		Less than 1 Year		1-2 Years		3-4 Years		After 4 Years
Office leases	$	583	$	521	$	62	$	0	$	0

We have various contractual commitments pertaining to exploration, development and production activities. We entered the third exploration phase of the Dussafu PSC on May 28, 2012. In January 2013, the Budong PSC partners were granted a four year extension of the initial six year exploration term of the Budong PSC to January 15, 2017. The extension of the initial exploration term includes an exploration well, which if not drilled by January 2016, results in the termination of the Budong PSC. If we do not drill an exploration well before October 2014, our partner has the right to give us notice that the consideration for the additional 7.1 percent participating interest must be paid in cash for $3.2 million. See Note 9 – Indonesia. These work commitments are non-discretionary; however, we do have the ability to control the pace of expenditures.

Kensho Sone, et al. v. Harvest Natural Resources, Inc., in the United States District Court, Southern District of Texas, Houston Division. On July 24, 2013, 70 individuals, all alleged to be citizens of Taiwan, filed an original complaint and application for injunctive relief relating to the Company’s interest in the WAB-21 area of the South China Sea. The complaint alleges that the area belongs to the people of Taiwan and seeks damages in excess of $2.9 million and preliminary and permanent injunctions to prevent the Company from exploring, developing plans to extract hydrocarbons from, conducting future operations in, and extracting hydrocarbons from, the WAB-21 area. The Company has filed a motion to dismiss and intends to vigorously defend these allegations.

The following related class action lawsuits were filed on the dates specified in the United States District Court, Southern District of Texas: John Phillips v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (March 22, 2013) (“Phillips case”); Sang Kim v. Harvest Natural Resources, Inc., James A. Edmiston, Stephen C. Haynes, Stephen D. Chesebro’, Igor Effimoff, H. H. Hardee, Robert E. Irelan, Patrick M. Murray and J. Michael Stinson (April 3, 2013); Chris Kean v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (April 11, 2013); Prastitis v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (April 17, 2013); Alan Myers v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (April 22, 2013); and Edward W. Walbridge and the Edward W. Walbridge Trust v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (April 26, 2013). The complaints allege that the Company made certain false or misleading public statements and demand that the defendants pay unspecified damages to the class action plaintiffs based on stock price declines. All of these actions have been consolidated into the Phillips case. The Company and the other named defendants have filed a motion to dismiss and intend to vigorously defend the consolidated lawsuits.

In June 2012, the operator of the Budong PSC received notice of a claim related to the ownership of part of the land comprising the Karama-1 (“KD-1”) drilling site. The claim asserts that the land on which the drill site is located is partly owned by the claimant. The operator purchased the site from local landowners in January 2010, and the purchase was approved by BPMIGAS, Indonesia’s oil and gas regulatory authority. The claimant is seeking compensation of 16 billion Indonesia Rupiah (approximately $1.4 million, $1.0 million net to our 71.61 percent cost sharing interest) for land that was purchased at a cost of $4,100 in January 2010. On March 8, 2013, the court ruled to dismiss the claim because the claim had not been filed against the proper parties to the claim. On March 19, 2013, the claimant filed an appeal against the judgment. We dispute the claim and plan to vigorously defend against it.

In May 2012, Newfield Production Company (“Newfield”) filed notice pursuant to the Purchase and Sale Agreement between Harvest (US) Holdings, Inc. (“Harvest US”), a wholly owned subsidiary of Harvest, and Newfield dated March 21, 2011 (the “PSA”) of a potential environmental claim involving certain wells drilled on the Antelope Project. The claim asserts that locations constructed by Harvest US were built on, within, or otherwise impact or potentially impact wetlands and other water bodies. The notice asserts that, to the extent of potential penalties or other obligations that might result from potential violations, Harvest US must indemnify Newfield pursuant to the PSA. In June 2012, we provided Newfield with notice pursuant to the PSA (1) denying that Newfield has any right to indemnification from us, (2) alleging that any potential environmental claim related to Newfield’s notice would be an assumed liability under the PSA and (3) asserting that Newfield indemnify us pursuant to the PSA. We dispute Newfield’s claims and plan to vigorously defend against them.

On May 31, 2011, the United Kingdom branch of our subsidiary, Harvest Natural Resources, Inc. (UK), initiated a wire transfer of approximately $1.1 million ($0.7 million net to our 66.667 percent interest) intending to pay Libya Oil Gabon S.A. (“LOGSA”) for fuel that LOGSA supplied to our subsidiary in the Netherlands, Harvest Dussafu, B.V., for the company’s drilling operations in Gabon. On June 1, 2011, our bank notified us that it had been required to block the payment in accordance with the U.S. sanctions against Libya as set forth in Executive Order 13566 of February 25, 2011, and administered by OFAC, because the payee, LOGSA, may be a blocked party under the sanctions. The bank further advised us that it could not release the funds to the payee or return the funds to us unless we obtain authorization from OFAC. On October 26, 2011, we filed an application with OFAC for return of the blocked funds to us. Until that application is approved, the funds will remain in the blocked account, and we can give no assurance when OFAC will permit the funds to be released. Our October 26, 2011 application for the return of the blocked funds remains pending with OFAC.

Robert C. Bonnet and Bobby Bonnet Land Services vs. Harvest (US) Holdings, Inc., Branta Exploration & Production, LLC, Ute Energy LLC, Cameron Cuch, Paula Black, Johnna Blackhair, and Elton Blackhair in the United States District Court for the District of Utah. This suit was served in April 2010 on Harvest and Elton Blackhair, a Harvest employee, alleging that the defendants, among other things, intentionally interfered with plaintiffs’ employment agreement with the Ute Indian Tribe – Energy & Minerals Department and intentionally interfered with plaintiffs’ prospective economic relationships. Plaintiffs seek actual damages, punitive damages, costs and attorney’s fees. We dispute plaintiffs’ claims and plan to vigorously defend against them. On October 29, 2013, we learned that the court administratively closed the case. The case was recently reopened as a result of the Circuit Court of Appeals’ ruling against Plaintiffs’ discovery request. We dispute Plaintiffs’ claims and plan to vigorously defend against them.

Uracoa Municipality Tax Assessments. Harvest Vinccler S.C.A., a subsidiary of Harvest Holding (“Harvest Vinccler”), has received nine assessments from a tax inspector for the Uracoa municipality in which part of the Uracoa, Tucupita and Bombal fields are located as follows:

• Three claims were filed in July 2004 and allege a failure to withhold for technical service payments and a failure to pay taxes on the capital fee reimbursement and related interest paid by PDVSA under the Operating Service Agreement (“OSA”). Harvest Vinccler has filed a motion with the Tax Court in Barcelona, Venezuela, to enjoin and dismiss one of the claims and has protested with the municipality the remaining claims.

• Two claims were filed in July 2006 alleging the failure to pay taxes at a new rate set by the municipality. Harvest Vinccler has filed a protest with the Tax Court in Barcelona, Venezuela, on these claims.

• Two claims were filed in August 2006 alleging a failure to pay taxes on estimated revenues for the second quarter of 2006 and a withholding error with respect to certain vendor payments. Harvest Holding has filed a protest with the Tax Court in Barcelona, Venezuela, on one claim and filed a protest with the municipality on the other claim.

• Two claims were filed in March 2007 alleging a failure to pay taxes on estimated revenues for the third and fourth quarters of 2006. Harvest Vinccler has filed a protest with the municipality on these claims.

Harvest Vinccler disputes the Uracoa tax assessments and believes it has a substantial basis for its positions based on the interpretation of the tax code by SENIAT (the Venezuelan income tax authority), as it applies to operating service agreements, Harvest Holding has filed claims in the Tax Court in Caracas against the Uracoa Municipality for the refund of all municipal taxes paid since 1997.

Libertador Municipality Tax Assessments. Harvest Vinccler has received five assessments from a tax inspector for the Libertador municipality in which part of the Uracoa, Tucupita and Bombal fields are located as follows:

• One claim was filed in April 2005 alleging the failure to pay taxes at a new rate set by the municipality. Harvest Vinccler has filed a protest with the Mayor’s Office and a motion with the Tax Court in Barcelona, Venezuela, to enjoin and dismiss the claim. On April 10, 2008, the Tax Court suspended the case pending a response from the Mayor’s Office to the protest. If the municipality’s response is to confirm the assessment, Harvest Holding will defer to the Tax Court to enjoin and dismiss the claim.

• Two claims were filed in June 2007. One claim relates to the period 2003 through 2006 and seeks to impose a tax on interest paid by PDVSA under the OSA. The second claim alleges a failure to pay taxes on estimated revenues for the third and fourth quarters of 2006. Harvest Vinccler has filed a motion with the Tax Court in Barcelona, Venezuela, to enjoin and dismiss both claims.

• Two claims were filed in July 2007 seeking to impose penalties on tax assessments filed and settled in 2004. Harvest Vinccler has filed a motion with the Tax Court in Barcelona, Venezuela, to enjoin and dismiss both claims.

Harvest Vinccler disputes the Libertador allegations set forth in the assessments and believes it has a substantial basis for its position. As a result of the SENIAT’s interpretation of the tax code as it applies to operating service agreements, Harvest Vinccler has filed claims in the Tax Court in Caracas against the Libertador Municipality for the refund of all municipal taxes paid since 2002.

On May 4, 2012, Harvest Vinccler learned that the Political Administrative Chamber of the Supreme Court of Justice issued a decision dismissing one of Harvest Vinccler’s claims against the Libertador Municipality. Harvest Vinccler continues to believe that it has sufficient arguments to maintain its position in accordance with the Venezuelan Constitution. Harvest Vinccler plans to present a request of Constitutional Revision to the Constitutional Chamber of the Supreme Court of Justice once it is notified officially of the decision. Harvest Vinccler has not received official notification of the decision. Harvest Vinccler is unable to predict the effect of this decision on the remaining outstanding municipality claims and assessments.

On February 21, 2014, Tecnica Vial and Flamingo, our partners in Colombia on Blocks VSM14 and VSM15, respectively, filed for arbitration of claims related to the farmout agreements for each block. We had received notices of default from our partners for failing to comply with certain terms of the farmout agreements, followed by notices of termination on November 27, 2013. We determined that it was appropriate to fully impair the costs associated with these interests, and we recorded an impairment charge of $3.2 million during the year ended December 31, 2013 which includes an accrual of $2 million related to this matter. We intend to vigorously defend the arbitration.

We are a defendant in or otherwise involved in other litigation incidental to our business. In the opinion of management, there is no such litigation that will have a material adverse effect on our financial condition, results of operations and cash flows.