Another Big Problem for Harvest Natural Resources

Print Email

Oil and gas producer Harvest Natural Resources Inc. (NYSE: HNR) said this morning that proved and probable reserves for its joint venture in Venezuela, Petrodelta, declined in 2012. The news comes just a few weeks after the sale of Petrodelta to Indonesia’s Pertamina was cancelled by the potential buyer.

Harvest’s 32% share of the total proved and probable reserves came to just over 100 million barrels at the end of 2012. That was down 3% from the company’s reserves position at the end of 2011. Worse still, proved reserves fell 11% to 38.4 million barrels of oil equivalent at the end of 2012.

This is the latest in a string of lousy news for Harvest. There is the failed deal with Pertamina, and even worse was the company’s failure to file its Form 10-K annual report on time and the possibility that Harvest will have to restate financial results for the past three years. As part of that announcement, Harvest said that its auditors would include in the audit report a “going concern” note.

Shares of Harvest are down more than 11% today to $2.63, after posting a new 52-week low of $2.45 earlier. The 52-week high is $10.83, posted just before the announcement of the failed sale to Pertamina.