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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No.     )

Filed by the Registrant  x                              Filed by a Party other than the Registrant  ¨

Check the appropriate box:

HARVEST NATURAL RESOURCES, INC.

(Name of registrant as specified in its charter)

(Name of person(s) filing proxy statement, if other than the registrant)

Payment of Filing Fee (Check the appropriate box):

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		JAMES A. EDMISTON PRESIDENT AND CEO

August 2, 2016

Dear Fellow Stockholders,

On behalf of the Board of Directors of Harvest Natural Resources, Inc. (“Harvest,” “we,” “us,” or “our”), we invite you to join us at our annual meeting of stockholders, which will be held on September 8, 2016, at 8:30 a.m. central time, at our headquarters located at 1177 Enclave Parkway, Suite 300, Houston, Texas 77077.

On June 30, 2016, we announced that we had entered into a share purchase agreement under which we would sell all of the interests in our Venezuelan assets to CT Energy Holding SRL, a private investment firm (“CT Energy”). Our board of directors (our “Board”), after receiving the unanimous advice and recommendation of an independent committee of our Board, has unanimously approved the proposed sale and has recommended that it be authorized by our stockholders. We are asking you to approve this sale. In connection with the vote to approve the sale of our Venezuelan assets, and as required by Securities and Exchange Commission regulations, you will also be asked to consider and vote on a non-binding, advisory proposal to approve compensation that will or may become payable by us to our named executive officers under existing agreements as a result of the sale. For more information concerning the proposed sale of our Venezuelan assets and compensation payable as a result of the sale, please see the section of the proxy statement titled Sale of our Venezuelan Assets and Proposals 1 and 2 beginning on page 3.

At the annual meeting, we are also asking you to vote on our usual annual meeting proposals, including proposals to elect seven directors and to ratify the appointment of BDO USA, LLP as our independent registered public accounting firm for 2016. We are also asking you to vote on a proposal to amend our certificate of incorporation to effect a reverse split of our common stock at a ratio between one-for-four and one-for-ten, inclusive, with the exact ratio to be determined by our Board based on market and other considerations. This amendment is necessary for us to continue to comply with the listing requirements of the New York Stock Exchange. For information concerning these matters, please see the sections of the proxy statement titled Standard Annual Meeting Matters and Proposals 3 and 4 beginning on page 76 and Reverse Stock Split and Proposal 5 beginning on page 109.

Your vote is very important. The proposed sale of our Venezuelan interests and the proposed amendment of our certificate of incorporation to effect a reverse stock split cannot be effected without the affirmative vote of the holders of a majority of the outstanding shares of our common stock entitled to vote. The proposed sale of our Venezuelan interests also requires the affirmative vote of the holders of a majority of the outstanding shares of our common stock, other than CT Energy, entitled to vote. If you abstain from voting, if you do not provide us with your proxy, if you do not instruct your broker to vote your shares, or if you otherwise fail to vote, it will have the same effect as voting against the proposed sale and amendment.

OUR BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” EACH OF THE PROPOSALS TO BE CONSIDERED AT THE ANNUAL MEETING.

We encourage you to read the accompanying proxy statement, which provides information regarding Harvest and each proposal to be considered at the annual meeting. Whether or not you plan to attend the annual meeting, please submit your enclosed proxy card or vote by telephone or internet as soon as possible so that your shares can be voted at the meeting in accordance with your instructions. You may submit your proxy over the internet, by telephone or by mail, as further described in the section of the proxy statement titled Questions and Answers Regarding the Annual Meeting and Future Stockholder Proposals beginning on page 118. Voting by proxy will not prevent you from voting your shares in person if you choose to attend the annual meeting.

Thank you for your continued support of Harvest Natural Resources.

Sincerely,

James A. Edmiston

President and Chief Executive Officer

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PROXY STATEMENT

HARVEST NATURAL RESOURCES, INC.

1177 Enclave Parkway, Suite 300

Houston, Texas 77077

(281) 899-5700

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

By Order of the Board of Directors

James A. Edmiston

President and Chief Executive Officer

On or about August 8, 2016, we will mail to our stockholders the proxy materials for our annual meeting, including the proxy statement, the proxy card and our 2015 Annual Report. These proxy materials will contain instructions on how to vote your shares.

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INDEX TO APPENDICES

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INTRODUCTION TO THIS PROXY STATEMENT

This proxy statement provides our stockholders with important information about us and the proposals to be considered at our annual meeting to be held on September 8, 2016. We are asking our stockholders of record on August 1, 2016 (the “Record Date”) to vote on four sets of proposals, all of which are described in detail in this proxy statement.

THE PROPOSALS

First, we are asking you to vote on proposals relating to our recently announced transaction with CT Energy Holding SRL, a private investment firm (“CT Energy”), by which we will sell our interests in Venezuela to CT Energy. These proposals include:

You can find more information about the proposed sale of our Venezuelan assets and associated management compensation in the section of this proxy statement titled Sale of our Venezuelan Interests and Proposals 1 and 2 beginning on page 3.

Second, we are asking you to vote on two proposals relating to the matters our stockholders typically consider at our annual meetings. They include:

You can find more information about these annual meeting proposals in the section of this proxy statement titled Standard Annual Meeting Matters and Proposals 3 and 4 beginning on page 76. This section also includes information about our corporate governance, our board of directors (our “Board”), our executive officers, our stock ownership, certain relationships and related transactions and audit matters.

Third, we are asking you to vote on a proposal to amend our certificate of incorporation to effect a reverse stock split of our common stock at a ratio between one-for-four and one-for-ten, inclusive, with the exact ratio to be determined by our Board, which is required to align the per share price of our common stock with New York Stock Exchange (“NYSE”) regulations. You can find more information about this proposed amendment and our plans for the reverse stock split under the heading Reverse Stock Split and Proposal 5 beginning on page 109.

Finally, we are asking you to approve two administrative proposals relating to the conduct of the meeting:

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You can find more information about these two administrative proposals under the heading Administrative Matters and Proposals 6 and 7 beginning on page 117.

In total, we are asking you to vote on seven proposals, all of which have been approved unanimously by our Board. We request that each stockholder of record on the Record Date vote on these matters as soon as possible by submitting a proxy in accordance with the procedures described in the section of this proxy statement titled Questions and Answers Regarding the Annual Meeting and Future Stockholder Proposals beginning on page 118. This section also includes other information about the annual meeting and related procedures.

INFORMATION IN THIS PROXY STATEMENT

Terms

We have used numerous defined terms in this proxy statement. For your convenience, we have included a list of those defined terms in the section of this proxy statement titled Index to Defined Terms Used in this Proxy Statement beginning on page 124.

Organizational Chart

To help you better understand some of the information in this proxy statement, including the proposal to sell our interests in Venezuela, and the various relationships among us, our subsidiaries and related parties, there is an organizational chart for your reference on page 11.

Cautionary Notice Regarding Forward-Looking Statements

We caution that any forward-looking statements, as that 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 proxy statement involve risks and uncertainties and are subject to change based on various important factors. When used in this proxy statement, the words “budget,” “forecast,” “expect,” “believes,” “goals,” “projects,” “plans,” “expects,” “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, among other factors, the failure to obtain the requisite stockholder approvals of the proposed transaction; the possibility that the closing conditions to the contemplated transaction may not be satisfied or waived, including that a governmental entity may prohibit, delay or refuse to grant a necessary regulatory approval; delay in closing the transaction or the possibility of non-consummation of the transaction; the occurrence of any event that could give rise to termination of the Share Purchase Agreement; risks related to the disruption of the transaction to Harvest and its management; the effect of announcement of the transaction on Harvest’s ability to retain and hire key personnel and maintain relationships with its partners, suppliers and other third parties; difficult global economic and commodity and capital markets conditions; changes in the legal and regulatory environment; 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 stockholder 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

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interest rates; our ability to acquire oil and natural gas properties that meet our objectives; availability and cost of drilling rigs and seismic crews; 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; our ability to continue as a going concern; and other risks, including those discussed in our Annual Report on Form 10-K for the year ended December 31, 2015 and other public filings.

References to Other Documents

Statements contained in this proxy statement regarding the contents of any contract or other document are not necessarily complete and are qualified by reference to that contract or other document.

Effectiveness of Information

You should rely only on the information contained in this proxy statement. We have not authorized anyone to provide you with information that is different from what is contained in this proxy statement. This proxy statement is dated August 2, 2016. You should not assume that the information contained in this proxy statement is accurate as of any date other than that date. The mailing of the proxy statement to stockholders does not create any implication to the contrary.

Consulting Your Own Advisors

You may wish to consult your own legal, tax and financial advisors with respect to any aspect of the proposed sale of our Venezuelan interests or other matters described in this proxy statement.

SALE OF OUR VENEZUELAN INTERESTS AND PROPOSALS 1 AND 2

THE PROPOSED SALE

Summary Term Sheet

This summary of the proposed sale of our Venezuelan interests highlights important information discussed in more detail elsewhere in this proxy statement. The summary does not contain all of the information you should consider before voting on the proposed sale. To understand the proposed sale more fully, you are urged to read carefully this entire proxy statement and all of its appendices, including the Share Purchase Agreement, a copy of which is attached as Appendix A to this proxy statement, before voting on whether to authorize the proposed sale. The parenthetical page references beside each heading in this summary indicate where in this proxy statement you can find more detailed information about each subject. This summary only relates to the proposed sale of our Venezuelan interests. Information regarding other matters to be considered at the annual meeting are included in other sections of this proxy statement; please refer to the table of contents to help you locate this other information.

Parties Related to the Proposed Sale (Page 10)

Harvest Natural Resources, Inc. – We are an independent energy company headquartered in Houston, Texas. We own all of HNR Energia B.V. For information about how to contact us, please see Questions and Answers Regarding the Annual Meeting and Future Stockholder Proposals – How Can I Obtain Additional Information? beginning on page 122. In the Share Purchase Agreement, we are referred to as “HNR.”

HNR Energia B.V. (“HNR Energia”) – HNR Energia, a private company with limited liability under the laws of Curacao, is one of our wholly owned subsidiaries. It owns a 51% interest in Harvest-Vinccler

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Dutch Holding B.V. (“Harvest Holding”), which indirectly owns 40% of Petrodelta, a joint venture that owns and operates certain oil and gas interests in Venezuela. HNR Energia’s principal place of business is Prins Bemhardplein 200, 1097 JB Amsterdam, the Netherlands, and its telephone number is + 31 20 521 4777. In the Share Purchase Agreement, HNR Energia is referred to as the “Seller.”

CT Energy Holding SRL – CT Energy is a private investment firm based in Venezuela that currently owns approximately 16.8% of our outstanding common stock. For information about how to contact CT Energy, please see – Information About CT Energy beginning on page 71. In the Share Purchase Agreement, CT Energy is referred to as the “Buyer.”

A chart showing our Venezuelan-related organization is on page 11.

You are being asked to approve HNR Energia’s sale of its 51% interest in Harvest Holding to CT Energy.

Key Terms of the Proposed Sale (Page 12)

On June 29, 2016, we and HNR Energia entered into a share purchase agreement with CT Energy (also referred to as the “Share Purchase Agreement”) to sell all of our Venezuelan interests through the sale of HNR Energia’s equity interest in Harvest Holding, in exchange for (1) $80 million in cash (subject to adjustment), (2) a promissory note for $12 million payable six months after closing, (3) the cancellation of $30 million of debt owed by us to CT Energy, (4) CT Energy’s relinquishment of 8,667,597 shares of our common stock (approximately 16.8% of all outstanding shares), representing all shares of our common stock owned by CT Energy, and (5) the termination of a warrant held by CT Energy to buy 34,070,820 shares of our common stock for $1.25 per share. At the closing, we are required to pay all outstanding amounts we owe to CT Energy under existing notes, after the cancellation of the $30 million of debt. The effective date of the transaction for economic and financial purposes will be June 1, 2016.

The closing of the sale is conditioned on, among other things, (1) the approval by the Government of the Bolivarian Republic of Venezuela (“Venezuela”), (2) the authorization by the holders of (a) a majority of our outstanding common stock and (b) a majority of our outstanding common stock held by stockholders other than CT Energy and its affiliates and (3) the waiver by Petroandina Resources Corporation N.V. (“Petroandina”), a subsidiary of Pluspetrol Resources Corporation B.V. (“Pluspetrol”), of its rights under the Shareholders’ Agreement with HNR Energia, dated as of December 16, 2013 (the “Shareholders’ Agreement”), with respect to the sale of our Venezuelan interests, including any obligation of CT Energy to become a party to the Shareholders’ Agreement, or the exercise by Petroandina of its change of control put right to sell its 29% interest in Harvest Holding to CT Energy at the same time as HNR Energia sells its interests.

When the parties signed the Share Purchase Agreement, CT Energy provided us with a $15 million irrevocable standby letter of credit issued by JP Morgan Chase Bank (the “Letter of Credit”). If the closing occurs, the Letter of Credit will be returned undrawn to CT Energy and JP Morgan Chase Bank. We are entitled to draw on the Letter of Credit and keep the $15 million proceeds as liquidated damages if (1) the Share Purchase Agreement is terminated because of a material uncured breach by CT Energy or (2) the Share Purchase Agreement is terminated when all conditions to closing have been satisfied (other than the approval by the Government of Venezuela and other conditions that can only be satisfied by CT Energy at the closing), including the authorization by our stockholders that is the subject of this proxy statement. If the Share Purchase Agreement is terminated for any other reason, the Letter of Credit must be returned undrawn to CT Energy and JP Morgan Chase Bank.

We are also entitled to draw on the Letter of Credit within 10 business days of the expiration of the Letter of Credit if the Share Purchase Agreement has not been terminated, and as of such date, CT Energy has failed to deliver or cause to be delivered a replacement letter of credit and our Board has authorized a draw on the Letter of Credit. In this case, we are required to hold the $15 million proceeds in trust for disbursement to either Harvest or CT Energy pursuant to the terms of the Share Purchase Agreement.

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The Share Purchase Agreement requires that the closing of the sale will occur within ten business days after the satisfaction or waiver of the last condition to closing (unless otherwise agreed to by the parties). If we do not receive the approval of our stockholders by September 15, 2016, then CT Energy may terminate the Share Purchase Agreement. If all conditions to the sale are not satisfied within 30 days after we receive the approval of our stockholders, then HNR Energia or CT Energy may terminate the Share Purchase Agreement.

We also have the right to terminate the Share Purchase Agreement if we decide to enter into an alternative acquisition agreement with respect to a “superior proposal” (as defined in the Share Purchase Agreement, and as further discussed in Documents Governing the Proposed Sale – Share Purchase Agreement – Fiduciary Out beginning on page 45). If we exercise this right, then we must pay CT Energy a termination fee of $4.6 million and pay all outstanding debt we owe to CT Energy, which was approximately $35.3 million in aggregate principal and accrued interest as of August 1, 2016, plus accrued interest and any associated make-whole premiums. We must also pay this termination fee if CT Energy terminates the Share Purchase Agreement as a result of our uncured breach of the agreement or if our Board effects a “change in recommendation” (as that term is defined in the Share Purchase Agreement) with respect to the proposed sale to CT Energy.

We have guaranteed HNR Energia’s performance of all obligations arising under the Share Purchase Agreement.

The Share Purchase Agreement is attached as Appendix A to this proxy statement.

Opinion of Financial Advisor (Page 23)

The Special Committee engaged Tudor, Pickering, Holt & Co. Advisors, LLC (“TPH”) as its financial advisor for purposes of the proposed transaction. TPH delivered an opinion to the Special Committee as to the fairness, from a financial point of view, to Harvest of the consideration to be received by Harvest and HNR Energia under the Share Purchase Agreement.

The full text of TPH’s written opinion, dated June 29, 2016, is attached as Appendix B to this proxy statement and is incorporated by reference into this document. We encourage you to read the opinion carefully in its entirety for a description of, among other things, the assumptions made, procedures followed, factors considered and qualifications and limitations on the review undertaken. TPH’s opinion was provided to the Special Committee in connection with the Special Committee’s consideration of the Share Purchase Agreement, does not address any other aspect of the proposed sale and does not constitute a recommendation as to how any holder of interests in Harvest or any other party to the Share Purchase Agreement should vote or act with respect to the sale, or any other matter. See The Proposed Sale — Opinion of the Financial Advisor to the Special Committee beginning on page 23.

Interests of Harvest’s Directors and Executive Officers in the Proposed Sale (Page 71)

In considering the recommendation of the our Board, stockholders should be aware that some of Harvest’s directors and executive officers may have interests in the proposed sale that are different from, or in addition to, the interests they may have as stockholders. See Interests of Harvest’s Directors and Executive Officers in the Proposed Sale beginning on page 71.

Use of Proceeds and Nature of Our Business Following the Proposed Sale (Page 29)

If the proposed sale of our Venezuelan interests is completed, a significant portion of our assets will be cash from the proceeds of the sale. We will use these proceeds to pay expenses and taxes associated with the sale and for other operating expenses. Subject to determinations to be made by our Board, the remaining proceeds may be used to pay dividends or other distributions to stockholders, to continue to operate our business in the ordinary course (including possible acquisitions of assets), or some combination of the two.

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The decision of our Board regarding how to use the remaining assets will be based on its determination of what is in the best interests of Harvest and its stockholders at the time a decision is made. We will also continue to seek opportunities to sell some or all of our non-Venezuelan asset if we are able to negotiate a sale or sales in transactions that our Board believes are in the best interests of Harvest and its stockholders. To the extent we have not sold any non-Venezuelan asset, we intend to operate and develop those assets in the ordinary course of business.

Stockholder Vote Required to Approve the Proposed Sale (Page 40)

You are being asked to consider and vote on a proposal to authorize the sale of our Venezuelan interests described in this proxy statement and in the Share Purchase Agreement. We are obtaining this vote for two reasons: first, to comply with Section 271 of the Delaware General Corporation Law (“DGCL”), which requires a stockholder vote for a corporation to sell substantially all of its assets, we need the affirmative authorization of the holders of a majority of all outstanding shares of our common stock; and second, because the Share Purchase Agreement requires that we also obtain the affirmative authorization of the holders of a majority of our outstanding shares of common stock held by stockholders other than CT Energy and its affiliates. Abstentions, broker non-votes and failures to vote will have the effect of a vote against the proposed sale of our Venezuelan interests. On the Record Date there were 51,393,479 shares of our common stock outstanding and entitled to be voted at the meeting.

Recommendation of Our Board and Reasons for the Proposed Sale (Page 21)

Our Board designated and appointed a special, independent committee of our Board (the “Special Committee”) for the purpose of evaluating, reviewing and negotiating the proposed sale. The Special Committee unanimously (1) determined that the proposed transaction with CT Energy and the terms of the Share Purchase Agreement and related documents are expedient, advisable, fair to, and in the best interest of our stockholders, (2) approved the transaction and the related documents, (3) recommended that the full Board approve the transaction and related documents and recommended that our stockholders authorize the transaction in accordance with the terms of the Share Purchase Agreement. Our full Board unanimously (1) determined that the proposed transaction with CT Energy and the terms of the Share Purchase Agreement and related documents are expedient, advisable, fair to, and in the best interest of our stockholders, (2) approved the transaction and the related documents, and (3) recommended that our stockholders authorize the transaction in accordance with the terms of the Share Purchase Agreement. Our Board recommends that you vote “FOR” the authorization of the proposed sale of our Venezuelan interests.

Voting Procedures (Page 118)

Each share of our outstanding common stock is entitled to one vote at the meeting. You may vote by completing, signing and mailing your proxy card in the postage-paid envelope, by submitting your proxy by the internet, by submitting your proxy by telephone, or by attending the meeting and voting in person. Whether or not you intend to attend the meeting, please provide your proxy to ensure that your shares are represented at the meeting and your vote is counted.

Risk Factors Related to the Proposed Sale of Our Venezuelan Interests

You should carefully review the risk factors described below as well as the other information provided to you or referenced in this proxy statement in deciding how to vote on the proposed sale of our Venezuelan interests. For a discussion of additional considerations, we refer you to the documents we file from time to time with the SEC, particularly our most recent Annual Report on Form 10-K, including under the heading “Item 1A. Risk Factors,” and our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed since December 31, 2015. Additional risk factors and other considerations not known to us or that we currently believe are immaterial may also adversely affect our business and operations. If any of the following considerations actually

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occurs, our business, financial condition or results of operations could be materially and adversely affected, the value of our common stock could decline, and you may lose all or part of your investment. Please note that the risk factors discussed below also include forward-looking statements and our actual results may differ substantially from those discussed in those forward-looking statements. See Introduction to This Proxy Statement – Information in This Proxy Statement – Cautionary Notice Regarding Forward-Looking Information beginning on page 2.

While the proposed sale of our 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 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 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.

There is no assurance that the proposed sale of our Venezuelan interests 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 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.

We cannot assure you that the proposed sale of our 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, (i) the requirement that we obtain stockholder approval of the proposed sale, including approvals by both the holders of a majority of our outstanding common stock and the holders of a majority of our outstanding common stock held by stockholders other than CT Energy or its affiliates; (ii) the requirement that we obtain approval of the proposed sale from the Government of Venezuela; (iii) the requirement that Petroandina waive its rights under the Shareholders’ Agreement or exercise its change of control put right; (iv) requirements with respect to the accuracy of the representations and warranties of the parties to the Share Purchase Agreement; and (v) requirements with respect to the satisfaction or waiver of the covenants and obligations of the parties to the Share Purchase Agreement. See Documents Governing the Proposed Sale – Share Purchase Agreement – Conditions to the Proposed Sale beginning on page 40 for detailed information about all conditions to the closing. 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 closing conditions. If we are unable to meet all of the closing conditions, CT Energy would not be obligated to close the proposed sale of our Venezuelan interests. We also cannot be sure that circumstances, such as a material adverse effect, will not arise that would also allow CT Energy to terminate the Share Purchase Agreement before the

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closing. If the proposed sale is not approved by our stockholders or does not close for another reason, our Board 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:

We will not be entitled to draw on the $15 million available under the Letter of Credit provided by CT Energy at the signing of the Share Purchase Agreement and retain the proceeds of that draw, unless:

As discussed under – Documents Governing the Proposed Sale – Share Purchase Agreement – CT Energy’s Funding Covenant beginning on page 45, CT Energy has agreed to make certain monthly loans to us to fund our transaction expenses and operations until the closing. If the Share Purchase Agreement is terminated for any reason, there can be no assurance that CT Energy will continue to provide these funds after the date of termination. In addition, if the proposed sale of our 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 CT Energy. If this approval is not obtained, then the Share Purchase Agreement may be terminated. See Documents Governing the Proposed Sale – Share Purchase Agreement – Termination. In two previous proposed transactions, we were unable to obtain the approval of the Government of Venezuela to sell certain of our Venezuelan interests. We believe these proposed transactions did not succeed because the level of

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financial support the prospective purchasers offered to Petrodelta to carry on future Petrodelta operations was not sufficient to obtain the approval of the Government of Venezuela. See – The Proposed Sale – Background of the Proposed Sale beginning on page 14.

Closing of the transaction is also conditioned on receipt of the waiver by Petroandina of its rights under the Shareholders’ Agreement with respect to the sale of our Venezuelan interests, including any obligation of CT Energy to become a party to the Shareholders’ Agreement, or the exercise by Petroandina of its change of control put right to sell its 29% interest in Harvest Holding to CT Energy at the same time as HNR Energia sells its interests.

We may not be able to reach an amicable solution to the allegations of Petroandina that our transaction with CT Energy is in breach of the Shareholders’ Agreement.

On July 12, 2016, Petroandina filed a claim against us in the Court of Chancery in the State of Delaware alleging that by entering into the Share Purchase Agreement we breached the Shareholders’ Agreement. The claim requests that the Court of Chancery grant an injunction barring us from completing our transaction with CT Energy. A hearing before the Court of Chancery regarding Petroandina’s injunction request is scheduled for August 16, 2016. While we are currently vigorously defending our right to complete our transaction with CT Energy (provided that we comply with the change of control put right provisions of the Shareholders’ Agreement), there can be no assurances that we will be successful in this defense or in ultimately coming to an amicable resolution with Petroandina regarding these matters. For more information, see Sale of Our Venezuelan Interests and Proposals 1 and 2 – The Proposed Sale – Background of the Proposed Sale beginning on page 14.

If the proposed sale of our Venezuelan interests is not completed, there may not be any other offers from potential acquirors.

If the proposed sale of our 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.

Our directors and executive officers may have interests in the proposed sale that are different from, or in addition to, the interests they may have as stockholders.

In accordance with the terms of certain pre-existing agreements, our directors and executive officers may receive certain change of control payments as a result of the consummation of the proposed sale of our Venezuelan interests, or as a result of the combination of the consummation of the proposed sale and a termination event under the applicable agreement. Accordingly, our directors and executive officers may have interests in the proposed sale that are difference from, or in addition to, the interests of our stockholders generally. See – Golden Parachute Compensation beginning on page 72.

The opinion of the financial advisor to the Special Committee does not reflect changes in circumstances that may have occurred after the date of the opinion.

On June 29, 2016, the date the Share Purchase Agreement was executed, TPH delivered its opinion to the Special Committee that, based upon and subject to the assumptions, limitations and qualifications set forth in the opinion and based upon such other matters as TPH considered relevant, the consideration to be received by Harvest and HNR Energia pursuant to the Share Purchase Agreement was fair from a financial point of view to Harvest. TPH’s opinion speaks only as of the time it was rendered and not as of the closing of the proposed sale or any other time. Changes in circumstances that have or may occur after the date of TPH’s opinion could significantly alter the value, facts or elements on which the opinion was based.

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There is no guarantee that you will receive any of the net cash proceeds from the proposed sale of our Venezuelan interests in the form of dividends.

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 and based on its determination of what is in the best interests of Harvest and its stockholders at the time of determination. Our Board could decide that we should use all or a significant portion of the net cash proceeds from the sale for purposes other than to pay dividends to stockholders, including continuing our business.

We cannot assure you that our common stock will continue to meet NYSE continued listing standards after the consummation of the proposed sale of our Venezuelan interests.

If the proposed sale of our Venezuelan interests is consummated, our assets will consist of cash and our interests in of the Republic of Gabon (“Gabon”). The NYSE’s continued listing requirements provide that a listed company’s securities can be delisted if the company’s operating assets have been substantially reduced. While we intend to take all necessary actions to cause our common stock to continue to be listed on the NYSE, there can be no assurances that NYSE will not seek to delist our common stock based on our post-closing asset base. We expect that any determination by the NYSE would be influenced by our strategy going forward, including the continued operation of our Gabon interests, after the closing, a matter that remains subject to our Board’s discretion. See – Use of Proceeds and Nature of Our Business Following the Proposed Sale beginning on page 29. The delisting of our common stock from the NYSE would adversely impact liquidity of our common stock and could damage the trading price of our common stock.

Parties Related to the Proposed Sale

Harvest Natural Resources, Inc. is a petroleum exploration and production company incorporated under Delaware law in 1988. 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 own and have developed significant interests in Venezuela. In addition to our interests in Venezuela, we hold exploration acreage offshore Gabon. We operate from our Houston, Texas headquarters. We also have a regional office in Caracas, Venezuela and a field office in Port-Gentil, Gabon to support operations in those areas.

Our Venezuelan interests are owned through several subsidiaries in all of which we have direct or indirect controlling interests. The main business purpose of these subsidiaries is to assist us in the management of our Venezuela assets. We directly own all of the equity interest in HNR Energia. HNR Energia owns a 51% equity interest in Harvest Holding. The remaining equity interest of Harvest Holding is owned by Oil & Gas Technology Consultants (Netherlands) Cooperatie U.A. (“OGTC”) (20%) and Petroandina (29%), a subsidiary of Pluspetrol.

Harvest Holding owns, indirectly through subsidiaries, 40% of Petrodelta, S.A., (“Petrodelta”), which is a joint venture between Harvest Holding and affiliates of the Government of Venezuela that owns and operates our Venezuelan interests. Petrodelta is engaged in the exploration, production, gathering, transportation and storage of hydrocarbons from fields in Venezuela. Petrodelta’s portfolio of properties in eastern Venezuela includes large proven oil fields as well as properties with substantial opportunities for both development and exploration. We own a net 20.4% equity interest in Petrodelta, while OGTC owns a net 8.0% and Petroandina owns a net 11.6%. We do not have a business relationship with OGTC or Petroandina outside of Venezuela. HNR Energia and Petroandina are parties to the Shareholders’ Agreement governing their rights as owners of Harvest Holding. See Background of the Proposed Sale beginning on page 14.

The remaining 60% interest in Petrodelta is owned 56% by Corporacion Venezolana del Petroleo S.A. (“CVP”), and PDVSA Social S.A. owns the remaining 4%. Petroleos de Venezuela S.A. (“PDVSA”), which is 100% owned by the Government of Venezuela, owns 100% of CVP and PDVSA Social S.A. CVP, PDVSA

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Social S.A. and PDVSA are not parties to the Share Purchase Agreement. CVP is a Venezuelan corporation that has been designated by the Government of Venezuela as the entity that administers business ventures with private sector entities in the petroleum industry on behalf of PDVSA. PDVSA Social S.A. is a Venezuelan corporation that has been designated by the Government of Venezuela as the entity that will own portions of business ventures with private sector entities on behalf of PDVSA and use funds distributed to it by those entities to invest in social programs.

The following chart represents the ownership structure of Petrodelta:

This chart reflects only the entities related to Harvest’s Venezuelan operations. HNR Energia B.V. also owns Harvest’s other significant asset, its Gabon operations.

CT Energy is a private investment firm. CT Energy owns 8,667,597 shares (approximately 16.8%, of our common stock) and a warrant to acquire up to 34,070,820 shares of our common stock, subject to conditions set forth in the warrant (the “CT Warrant”).

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Terms of the Proposed Sale of Our Venezuelan Interests

On June 29, 2016, Harvest and HNR Energia entered into the Share Purchase Agreement with CT Energy to sell our 51% equity interest in Harvest Holding for an aggregate consideration of:

We have guaranteed HNR Energia’s performance of all obligations arising under the Share Purchase Agreement.

When the parties signed the Share Purchase Agreement, CT Energy provided us with the Letter of Credit. If the closing occurs, the Letter of Credit will be returned undrawn to CT Energy and JP Morgan Chase Bank. We are entitled to draw on the Letter of Credit and keep the $15 million proceeds as liquidated damages if (1) the Share Purchase Agreement is terminated because of a material uncured breach by CT Energy or (2) the Share Purchase Agreement is terminated when all conditions to closing have been satisfied (other than the approval by the Government of Venezuela and other conditions that can only be satisfied by CT Energy at the closing), including the authorization by our stockholders that is the subject of this proxy statement. If the Share Purchase Agreement is terminated for any other reason, the Letter of Credit must be returned undrawn to CT Energy and JP Morgan Chase Bank.

We are also entitled to draw on the Letter of Credit within 10 business days of the expiration of the Letter of Credit if the Share Purchase Agreement has not been terminated, and as of such date, CT Energy has failed to deliver or cause to be delivered a replacement letter of credit and our Board has authorized a draw on the Letter of Credit. In this case, we are required to hold the $15 million proceeds in trust for disbursement to either Harvest or CT Energy pursuant to the terms of the Share Purchase Agreement.

At the closing, the $80 million cash consideration will be (1) reduced by the amount by which the outstanding principal and accrued interest under the 15% Note exceeds $30 million, (2) reduced by any other debt and accrued and unpaid interest we owe CT Energy (including debt and accrued and unpaid interest outstanding under the Additional Draw Note, as discussed below), and (3) increased by the aggregate amount of cash contributed by Harvest or HNR Energia to, or accounts payable and other expenses accrued by Harvest or HNR Energia for the benefit of, Harvest Holding and its subsidiaries in respect of expenditures included in Harvest Holdings’ budget. The 15% Note and the Additional Draw Note will be transferred by HNR Energia to Harvest after the closing and subsequently cancelled.

The closing of the transaction is subject to the following conditions, in addition to other customary conditions:

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See Documents Governing the Proposed Sale – Share Purchase Agreement – Conditions to the Proposed Sale beginning on page 40 for detailed information about all conditions to the closing.

We have agreed not to solicit other offers to acquire us or our interests in Venezuela while the Share Purchase Agreement is in effect. If we receive an unsolicited offer, we may not engage in negotiations or substantive discussions with, or furnish any information and reasonable access to, any third party making the offer or its representatives unless the Special Committee determines in good faith, after consultation with the Special Committee’s outside legal and financial advisors, and based on information then available, that the offer constitutes, or is reasonably likely to result in, a superior proposal and we comply with other contractual requirements, including giving written notice to CT Energy after any such determination by the Special Committee and before taking any of the actions described above, providing information regarding the third party and its offer to CT Energy, entering into an acceptable confidentiality agreement with the third party and providing to CT Energy any material nonpublic information furnished to the third party.

We have the right to terminate the Share Purchase Agreement to accept a third party proposal if the Special Committee determines in good faith (after consultation with its outside legal counsel and financial advisor) that the third party proposal constitutes a superior proposal and that the failure to approve or recommend the superior proposal would be inconsistent with the fiduciary duties to our stockholders under applicable law. Before terminating the Share Purchase Agreement, we must (at CT Energy’s request) engage in good faith negotiations with CT Energy regarding the terms of the Share Purchase Agreement, and the Special Committee must consider any adjustments in the Share Purchase Agreement proposed by CT Energy and determine in good faith (after consultation with its outside legal counsel and financial advisor) that the superior proposal continues to be superior. In addition, we may not terminate the Share Purchase Agreement unless, concurrently with the termination, we pay CT Energy a break-up fee of $4.6 million and all outstanding principal and accrued interest under the 15% Note and the Additional Draw Note. For more information regarding what constitutes a superior proposal, see Documents Governing the Proposed Sale – Share Purchase Agreement – Fiduciary Out beginning on page 45.

CT Energy may terminate the Share Purchase Agreement if our stockholders do not approve the transaction by September 15, 2016. Either CT Energy or HNR Energia may terminate the Share Purchase Agreement if all conditions to the closing are not satisfied within 30 days after receipt of the approval by our stockholders, except that a party that is in material breach of its obligations under the Share Purchase Agreement may not terminate the Share Purchase Agreement if the material breach is the principal cause of a condition to closing not being satisfied. If the Share Purchase Agreement is terminated as a result of a material uncured breach of the Share Purchase Agreement by us, or because our Board changes its recommendation that our stockholders approve the transaction, we will be required to pay CT Energy a break-up fee of $4.6 million.

To fund our transaction expenses and operations until the closing, CT Energy has agreed to lend us $2.0 million of funds per month for up to five months beginning on July 19, 2016, until the earlier of the closing or the termination of the Share Purchase Agreement. These loans will be made under a 15% senior secured promissory note due 2020 dated June 19, 2015, payable to CT Energy (the “Additional Draw Note”). As of the date of this proxy statement, the outstanding principal under the Additional Draw Note is $4.0 million. We expect that the outstanding principal will increase to $6.0 million on August 19, 2016 and to $8.0 million on

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September 19, 2016. As discussed above, the $80 million cash consideration will be reduced by the amount outstanding under the Additional Draw Note at closing, including both outstanding principal and accrued interest.

The Share Purchase Agreement contains customary representations warranties and covenants. These representations, warranties and covenants were made only for the purposes of the Share Purchase Agreement and as of specific dates, are solely for the benefit of the parties to the Share Purchase Agreement, may be subject to limitations agreed on by the parties, and may be subject to standards of materiality applicable to the parties that differ from those applicable to our stockholders. You should not rely on the representations, warranties or covenants, or any description of them as characterizations of the actual state of facts or conditions of any party to the Share Purchase Agreement or any of their subsidiaries or affiliates. Information about the subject matter of the representations, warranties and covenants may change after the date of the Share Purchase Agreement, which subsequent information may or may not be fully reflected in public disclosures.

Under the Share Purchase Agreement, we waived all rights to exercise any legal action against PDVSA, unless and until the Share Purchase Agreement is terminated in accordance with its terms.

For a more detailed description of the documents governing the proposed transaction, see – Documents Governing the Proposed Sale beginning on page 38. For a more detailed description of the Venezuelan interests that are the subject of the proposed transaction, see – Description of Interests to be Sold beginning on page 32.

Background of the Proposed Sale

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 a financial advisor 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% of Petrodelta), and the approval of Pertamina’s stockholder, the Government of the Republic of Indonesia. After receiving notice from Pertamina in February 2013 that Pertamina’s stockholder had decided not to approve the transaction, we exercised our right to terminate the agreement in accordance with its terms. Although Pertamina did not explain why the Government of the Republic of Indonesia decided not to approve the proposed transaction, we believe that its decision was based in part on its conclusion that approval of the transaction by the Government of Venezuela would not be obtained on satisfactory terms.

After the termination of the Pertamina transaction, we continued to consider our strategic alternatives. We received several new 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.

On December 16, 2013, we entered into a share purchase agreement with Petroandina and its parent company, Pluspetrol, to sell all of our then-80% 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 Petroandina a 29% equity interest in Harvest Holding for $125 million. The second closing, to sell the remaining 51% equity interest in Harvest Holding, was subject to certain conditions, including approval of our stockholders and approval of the Government of Venezuela. At a meeting held on May 7, 2014, our stockholders approved the second-closing sale

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of our 51% interest in Harvest Holding. However, the approval of this transaction by the Government of Venezuela was not forthcoming. On January 1, 2015, we exercised our right to terminate the Petroandina share purchase agreement.

We believe that the proposed transaction with Pertamina and the second stage transaction with Petroandina did not succeed because the level of financial support the prospective purchasers offered to Petrodelta to carry on future Petrodelta operations was not sufficient to obtain the approval of the Government of Venezuela.

As a result of the termination of the Petroandina share purchase agreement on January 1, 2015, the Shareholders’ Agreement became effective. Generally, this agreement governs various rights of HNR Energia and Petroandina, as stockholders of Harvest Holding. In addition, under the Shareholders’ Agreement, we granted Petroandina certain rights if we propose to take certain actions that would effect a direct or indirect sale of our interests in Venezuela. These rights included (1) a tag-along right, which gives Petroandina the right to participate as a seller, if we propose to sell our Venezuelan interests to a third party under certain circumstances, (2) a change of control put right, which gives Petroandina the right to sell its 29% interest in Harvest Holding if there is a “change of control” over our Venezuelan interests, as defined in the Shareholders’ Agreement, and (3) a participation right, which gives Petroandina the right to receive information and offer to purchase our remaining Venezuela interests if we decide to offer them for sale.

After the termination of our share purchase agreement with Petroandina, we again considered our strategic alternatives. We received indications of interest from third-parties, provided due diligence materials to third parties under confidentiality agreements and had preliminary discussions with third parties regarding various kinds of transactions that would provide us with capital, either through the disposition of our assets or through financing arrangements. During this time, we also considered possible alternatives, court-supervised reorganizations, including in federal bankruptcy court and under Delaware corporate law, and engaged in conversations with the Government of Venezuela to explore possible transactions entailing the sale or other monetization of our interest in Petrodelta. Additionally, on January 15, 2015, HNR Finance and Harvest Vinccler S.C.A submitted a Request for Arbitration against the Government of Venezuela before the International Centre for Settlement of Investment Disputes (“ICSID”) regarding HNR Finance’s interest in Petrodelta. See Information About Harvest – Legal Proceedings beginning on page 54.

In April 2015 we met with representatives of CT Energy to discuss a possible transaction that would entail CT Energy’s acquisition of some measure of ownership of us and our Venezuelan operations, related financing of our operations, and strategic opportunities to work together to reorganize Petrodelta operations and financing. On June 19, 2015, we entered into a securities purchase agreement with CT Energy (the “Securities Purchase Agreement”) and related agreements, including:

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Under the Securities Purchase Agreement, CT Energy has certain governance rights, including

Certain aspects of the June 19, 2015 transaction with CT Energy, including an amendment to our certificate of incorporation to increase the number of authorized shares of our common stock and our obligation to issue shares of our stock to CT Energy upon exercise of the CT Warrant and in certain other circumstances, were approved by our stockholders at our annual stockholders’ meeting held on September 9, 2015.

In accordance with the discussions held with CT Energy and the terms of the Management Agreement, beginning in June 2015, we worked with representatives of CT Energy, CT Energia, CVP and PDVSA to attempt to restructure the operational and financing functions of Petrodelta. For more information about the terms of the proposed restructuring, see – Description of Interests to Be Sold – Petrodelta Restructuring Negotiations beginning on page 37. Our collective work to effect this restructuring is currently ongoing, and there are no assurances that we can be successful in reaching a definitive agreement to effect the terms we have discussed.

Beginning in early 2016, we began further discussions with representatives of CT Energy regarding prospects of our continuing negotiations with CVP and PDVSA to restructure the operations and financing of Petrodelta and our own financial requirements. Those discussions led to more specific discussions about the potential benefits to us and our stockholders if CT Energy would acquire all of our Venezuelan interests. While we held open the possibility of selling our Venezuelan interests to other parties, we knew from our experience with the failed Pertamina and Petroandina transactions that any such sale to a non-Venezuelan party would not be likely to succeed, and we received no credible proposals from other parties to buy our Venezuelan interests.

The Securities Purchase Agreement originally prohibited CT Energy from, among other things, making any offers to acquire our Venezuelan assets. After our initial discussions with CT Energy about possibly entering into a transaction in which CT Energy would purchase all of our interests in Venezuela, CT Energy requested that we provide it with a waiver of this prohibition so that these discussions could continue and so that CT Energy could consider whether it wished to provide us with a proposal. In response to CT Energy’s request, on April 1, 2016, James Edmiston, our CEO, provided CT Energy with a limited, two-week waiver, which permitted CT Energy to make an offer to purchase HNR Energia’s 51% interest in Harvest Holding.

On April 13, 2016, Harvest received a non-binding indication of interest from CT Energy outlining the terms under which CT Energy proposed to purchase HNR Energia’s 51% interest in Harvest Holding. The consideration proposed in CT Energy’s letter consisted of a cash payment of $60 million and surrender for cancellation of the 15% Note, 8,667,597 shares of our common stock and the CT Warrant. CT Energy’s letter indicated that it valued its proposal at approximately $104 million, with the surrender of the 15% Note being valued at approximately $33.6 million, which included $27.0 million of principal and a make-whole payment as a result of the prepayment of the 15% Note of approximately $6.6 million, the surrender of the shares of our

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common stock being valued at approximately $5.2 million based on the average price of our common stock for the preceding 30 trading days, and the surrender of the CT Warrant being valued at approximately $5.5 million based on the fair value attributed to the CT Warrant, as reported in our Annual Report on Form 10-K for the year ended December 31, 2015.

Our Board recognized that the proposed offer by CT Energy to purchase our Venezuelan interests was an interested-party transaction and that we should institute special procedures to protect our non-CT Energy stockholders in any negotiation process in connection with the proposed transaction. Our Board believed that these measures were necessary because CT Energy is our largest stockholder and has the right to nominate three members of our Board and because certain significant actions by our Board cannot be taken without the vote of at least one of the three members of our Board nominated by CT Energy.

On April 14, 2016, our Board established the Special Committee, consisting of Messrs. Chesebro’, Irelan and Murray, with Mr. Chesebro’ acting as chairman of the Special Committee. Our Board selected these individuals because they had no relevant interest in or relationship to CT Energy and its affiliates and would exercise independent judgment in determining whether we should enter into any transaction with CT Energy and, if so, what those terms should be. Our Board provided the Special Committee with a charter giving the Special Committee general authority to consider the CT Energy proposal, to negotiate any transaction between us and CT Energy, and to consider any similar proposals. Under the charter, the Special Committee was charged with considering, evaluating, negotiating, accepting or rejecting CT Energy’s proposal or any similar proposal, and to act on behalf of the best interest of all of our stockholders, as a whole. The Special Committee could decide to recommend a proposal to our full Board, or to decline to recommend any proposal at all. The Special Committee was permitted to incur expenses in connection with the discharge of its responsibilities. It was charged with selecting, retaining and determining the compensation and other terms of the retention of independent professional advisors, including legal counsel and financial advisors.

On April 21, 2016, the members of the Special Committee discussed the CT Energy proposal.

On May 9, 2016 the Special Committee met by telephone to further discuss the CT Energy offer on a preliminary basis and to consider the estimated return to stockholders from the CT Energy offer and other potential strategic alternatives, including a liquidation of Harvest. At that meeting, the Special Committee determined that it would retain separate legal counsel and a financial advisor to render an opinion with respect to any transaction. Mayer Brown LLP was retained as counsel to the Special Committee on May 10, 2016, because of its familiarity with Harvest’s Venezuelan assets and its involvement in prior efforts to sell those assets.

On May 16, 2016, James Edmiston, our CEO, Steve Haynes, our Chief Financial Officer, and Keith Head, our General Counsel, met with representatives of TPH. During this meeting, these members of our management provided certain information and updates about Harvest.

On May 17, 2016, Stephen Chesebro’, the Chairman of the Special Committee, sent a letter to Oswaldo Cisneros, the Chairman of CT Energy, thanking him for the CT Energy offer and conveying that although it was premature to negotiate the terms of a potential transaction, any offer by CT Energy for the purchase of HNR Energia’s 51% interest in Harvest Holding that would serve as the basis of negotiations would have to be conditioned on approval by the Special Committee and our Board as well as by both a majority of the issued and outstanding shares of our common stock and a majority of the issued and outstanding shares of our common stock that were not beneficially owned by CT Energy or its affiliates (the “Additional Stockholder Approval”). The letter also stated that because of the uncertainty in obtaining Venezuelan approval for any transaction, any offer, to serve as the basis of negotiations, must include a significantly higher cash purchase price, a means of compensating Harvest if Venezuelan approval was not obtained and continued financing for Harvest’s operations.

After contacting two potential financial advisor candidates, the Special Committee ultimately retained TPH as its financial advisor on May 20, 2016.

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On May 20, 2016, CT Energy sent a letter to the Special Committee. Among other items, the letter highlighted the strategic advantages to Harvest that CT Energy believed would result from the proposed transaction. In its letter, CT Energy agreed to deposit of 5% of the proposed $60 million cash purchase price into escrow and that this amount would be released to Harvest if a transaction could not be consummated due to the failure to obtain Venezuelan approval by a mutually agreed date. The letter also stated that any agreement to continue to fund Harvest’s operations was independent from its offer to purchase the Harvest Holding interest and that it did not believe that the Additional Stockholder Approval was necessary. The letter proposed a meeting on May 25, 2016 in Harvest’s offices to discuss CT Energy’s offer.

In preparation for the proposed meeting on May 25, 2016, the Special Committee, working with its legal advisors, met on May 24, 2016 and prepared a non-binding term sheet for a possible transaction with CT Energy. Among other terms, the term sheet proposed a cash purchase price of $125 million in addition to cancelation of the 15% Note, the shares of our common stock held by CT Energy and the CT Warrant. To the extent that the principal and interest of the 15% Note exceeded $30 million, the term sheet provided that the excess would be repaid out of the cash consideration, but no make-whole premium would be payable. The term sheet also provided for CT Energy to deposit $25 million into escrow and that this amount would be released to Harvest if the transaction did not close because Venezuelan approval could not be obtained, and to continue to fund Harvest pursuant to the terms of the Securities Purchase Agreement. The term sheet specified that the definitive agreement for the proposed transaction would be modeled on the December 2013 share purchase agreement between Harvest and Petroandina since those terms had been negotiated on an arm’s length basis between unaffiliated parties. The term sheet also provided for the Additional Stockholder Approval, in addition to the requirement that the transaction be approved by a majority of the outstanding shares of our common stock, including those owned by CT Energy and its affiliates, as required by Delaware law.

On May 24, 2016, the Special Committee met for dinner with Mr. Cisneros and representatives of CT Energy. At that dinner, the Special Committee presented CT Energy with the term sheet that had been prepared by the Special Committee in consultation with legal advisors.

On May 25, the Special Committee met with Mr. Cisneros and representatives of CT Energy for approximately two hours to discuss the term sheet provided the previous day. At that meeting, CT Energy offered to increase the cash portion of the purchase price to $80 million.

The Special Committee met again with representatives of CT Energy on May 26. The first part of that meeting included Harvest management, which presented various timing and budget scenarios in the event that Harvest and CT Energy were able to negotiate a definitive transaction. Following those discussions, Harvest management was asked to leave the meeting and the Special Committee continued to discuss the terms of a possible transaction with CT Energy. The Special Committee stated that it was willing to reduce the cash consideration from $125 million to $105 million if all of the other terms were satisfactory. CT Energy stated that it was not willing to increase the cash portion of the purchase price to more than $80 million, but was willing to provide a deposit of $15 million that would be retained by Harvest if the only condition precedent to a closing that was not satisfied was the required Venezuelan approval. The Special Committee stated that cash consideration of $80 million was insufficient and the meeting ended.

After the meeting between the Special Committee and CT Energy on May 26, the Special Committee met with representatives of TPH that same day and discussed the status of the negotiations and the financial terms of the CT Energy offer.

Following its meeting with representatives of TPH, the Special Committee authorized a revision to the term sheet provided to CT Energy on May 24, reducing the cash portion of the purchase price to $92 million and accepting CT Energy’s proposed deposit of $15 million. On May 26 and May 27, there were further discussions with CT Energy and as a result of those discussions, the Special Committee authorized the term sheet to be

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further revised to provide for a cash portion of the purchase price of $80 million plus a six-month 15% promissory note of $12 million that would be secured by suitable collateral. This revised term sheet was delivered to CT Energy on May 28.

CT Energy responded to the May 28 term sheet on June 1 with its own non-binding term sheet. That term sheet also included a cash portion of the purchase price of $80 million and a $12 million six-month note guaranteed by Mr. Cisneros and bearing interest at 6%, but provided that if the principal, interest and make-whole premium of the 15% Note exceeded $30 million, the excess would be repaid by a reduction of the cash portion of the purchase price. The CT Energy term sheet also provided less generous interim funding terms and amounts and provided for a break-up fee of $15 million if Harvest accepted a superior proposal following the execution of the definitive share purchase agreement. The CT Energy term sheet also allowed CT Energy to waive the requirement of the Additional Stockholder Approval if it agreed to indemnify our Board for any liability arising from the transaction.

The term sheet proposed by CT Energy was discussed by the Special Committee on a conference call on June 2. During that call, the Special Committee authorized the preparation of a revised term sheet that increased the interest rate on the $12 million note to 11%, provided that no make-whole payment on the 15% Note would be payable, increased the interim funding to the levels provided in the Securities Purchase Agreement, and reduced the break-up fee in the event that Harvest accepted a superior proposal to 3.5% of the $92 million cash and note portions of the purchase price. The term sheet also deleted CT Energy’s right to waive the requirement of the Additional Stockholder Approval. This term sheet was delivered to CT Energy on June 3.

On June 7, the Special Committee received a response to its term sheet from CT Energy which, among other changes, reinstated the payment of the make-whole premium on the 15% Note, reduced the interim funding levels below those permitted by the Securities Purchase Agreement and increased the break-up fee payable on acceptance of a superior proposal to 4% of the total consideration.

The Special Committee authorized a response to the CT Energy June 7 term sheet that eliminated the make-whole payment, increased the interim funding requirements to the levels provided in the Securities Purchase Agreement and proposed a break-up fee of 3.5% of the total consideration.

CT Energy responded on June 8, 2016 by accepting the commercial terms proposed in the Special Committee’s June 7 term sheet and proposing several non-commercial changes relating to the need to obtain a waiver under the Shareholders’ Agreement. During the course of June 8, the final points on the term sheet were negotiated. On June 9, 2016, the final term sheet was approved by the Special Committee by unanimous written consent and signed by representatives of Harvest and CT Energy.

On June 10, Harvest provided Petroandina with a notice required by the Shareholders’ Agreement stating that Harvest was in negotiations with CT Energy for the sale of the Harvest Holding shares and offering Petroandina the opportunity to make an offer for those shares. Petroandina responded to that notice on June 15, reserving its rights under the Shareholders’ Agreement.

On June 11, 2016, representatives of the Special Committee delivered a draft Share Purchase Agreement to CT Energy. The draft incorporated the terms of the term sheet and, as agreed by the parties, was otherwise generally consistent with the December 2013 share purchase agreement between Harvest and HNR Energia, on the one hand, and Pluspetrol and Petroandina, on the other hand. During the period between June 13 and June 20, counsel for the Special Committee and counsel for CT Energy negotiated the terms of the definitive Share Purchase Agreement, and by June 20, those negotiations had advanced to the point where the remaining material issues concerned the terms of the Letter of Credit to be issued by CT Energy to fund the deposit and the timing for the issuance of the Letter of Credit. The Special Committee was regularly advised and provided input during the course of these negotiations.

The Special Committee met by telephone on June 20 to hear a report on the status of the negotiations and a report from representatives of TPH as to its preliminary financial analysis of the transaction. Based on those

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reports, the Special Committee authorized its counsel to finalize the terms of the Share Purchase Agreement, subject to finalizing the terms on which the Letter of Credit would be issued, and authorized TPH to continue its analysis of the fairness to Harvest of the consideration to be received by Harvest and HNR Energia in the proposed transaction from a financial point of view.

On June 20, 2016, CT Energy funded the first of the monthly $2.0 million loans to us under the terms of the Securities Purchase Agreement and the Additional Draw Note.

On June 29, 2016, counsel to the Special Committee and CT Energy finalized with JP Morgan Chase Bank the terms upon which the Letter of Credit would be issued.

On June 29, 2016, after further consideration of the transaction and the oral report of TPH at the June 20, 2016 meeting, the members of the Special Committee met to consider the transaction, including the terms of the final draft of the Share Purchase Agreement. The Special Committee’s legal counsel and representatives of TPH also attended the meeting. The TPH representatives reviewed its analysis with the Special Committee and orally delivered the opinion described in The Proposed Sale – Opinion of the Financial Advisor to the Special Committee beginning on page 23. The Special Committee discussed these matters and unanimously (1) determined that the proposed transaction with CT Energy and the terms of the Share Purchase Agreement and related documents are expedient, advisable, fair to, and in the best interest of our stockholders, (2) approved the transaction and the related documents, (3) recommended that the full Board approve the transaction and related documents and recommended that our stockholders authorize the transaction in accordance with the terms of the Share Purchase Agreement.

On June 29, 2016, after the conclusion of the meeting of the Special Committee, the full Board met to consider the recommendations of the Special Committee and other matters related to the transaction. After discussion, the full Board unanimously (1) determined that the proposed transaction with CT Energy and the terms of the Share Purchase Agreement and related documents are expedient, advisable, fair to, and in the best interest of our stockholders, (2) approved the transaction and the related documents, (3) recommended that our stockholders authorize the transaction in accordance with the terms of the Share Purchase Agreement and (4) generally authorized our officers to take all necessary actions to effect these resolutions.

After the full Board meeting on June 29, 2016, we, HNR Energia and CT Energy signed and delivered the Share Purchase Agreement. After the signing, we issued a press release to announce the transaction. On June 30, 2016, we filed a Current Report on Form 8-K with the SEC describing the transaction and attaching as an exhibit the Share Purchase Agreement.

On June 30, 2016, we sent Petroandina a notice of a change of control over our Venezuelan interests based on our belief that the transaction with CT Energy met the definition of “change of control” in the Shareholders’ Agreement. The Shareholders’ Agreement provides Petroandina with a put right to cause its interest in Harvest Holding to be purchased if there is a change of control event. Under the change of control put right procedures, Petroandina would have 15 days from the date of our notice to request a determination of the fair market value of Petroandina’s 29% interest in Harvest Holding. Upon delivery of the notice, the parties would have 15 days from the date of the request to mutually agree on the appointment of an appraiser of Petroandina’s 29% interest in Harvest Holding, and, once appointed, the appraiser would have 30 days to conduct the appraisal. After the completion of the appraisal, Petroandina would have 15 days to notify us that it wishes to exercise its right to cause its 29% interest in Harvest Holding to be purchased. Upon exercise of the right, we would have to purchase, or cause to be purchased, all of Petroandina’s interest in Harvest Holding. The parties would then be required to close the sale by Petroandina of its 29% interest in Harvest Holding concurrently with the closing of the transaction giving rise to the change of control, in this case, the closing of our transaction with CT Energy.

On July 5, 2016, Petroandina responded to our June 30, 2016 notice, stating its position that Harvest and HNR Energia were in breach of the Shareholders’ Agreement as a result of the execution of the Share Purchase

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Agreement, and reserving the right to take all appropriate actions barring a prompt and amicable resolution. Petroandina’s response stated that we were prohibited from selling our 51% interest in Harvest Holding under provisions of the Shareholders’ Agreement generally prohibiting a transfer of the interest. This argument was based on Petroandina’s assertion that our proposed transaction with CT Energy did not constitute a “change of control” under the Shareholders’ Agreement; the Shareholders’ Agreement provides for several exceptions to the provisions generally prohibiting a transfer of our interest, including if there is a “change of control” event and we comply with the put right provisions.

On July 6, 2016, we responded to Petroandina’s response by reiterating that we believed that the provisions of the Shareholders’ Agreement permitted the sale of HNR Energia’s interest in Harvest Holding in reliance on the change of control put right exception.

On July 7, 2016, we received a letter from Petroandina reasserting its original position that we are in breach of the Shareholders’ Agreement. However, Petroandina did request a determination of the fair market value of its interest in Harvest Holding, without prejudice to its position that the CT Energy transaction does not comply with the Shareholders’ Agreement.

On July 12, 2016, Petroandina filed a claim in the Court of Chancery of the State of Delaware alleging that we are in breach of the Shareholders’ Agreement and requesting an injunction to prevent us from completing our transaction with CT Energy under the Share Purchase Agreement. A hearing before the Court of Chancery regarding Petroandina’s injunction request is scheduled for August 16, 2016. Petroandina filed this claim by amending a previously filed breach of contract claim against us filed in the Chancery Court on January 26, 2015. While the January 26, 2015 claim and the July 12, 2016 claim both relate to alleged breaches of contract of the Shareholders’ Agreement, the basis for the earlier claim (relating to our previous attempt to commence arbitration proceedings against the government of Venezuela) is not related to the basis for the current claim. For detailed information about the previous claim, see Information About Harvest – Legal Proceedings beginning on page 54.

We currently are attempting to reach an amicable resolution of the dispute with Petroandina.

Recommendation of Our Board and Reasons for the Proposed Sale

At a meeting held on June 29, 2016, the Special Committee unanimously (1) determined that the proposed transaction with CT Energy and the terms of the Share Purchase Agreement and related documents are expedient, advisable, fair to, and in the best interest of our stockholders, (2) approved the transaction and the related documents, (3) recommended that the full Board approve the transaction and related documents and recommended that our stockholders authorize the transaction in accordance with the terms of the Share Purchase Agreement. At a meeting held on June 29, 2016, our full Board unanimously (1) determined that the proposed transaction with CT Energy and the terms of the Share Purchase Agreement and related documents are expedient, advisable, fair to, and in the best interest of our stockholders, (2) approved the transaction and the related documents, and (3) recommended that our stockholders authorize the transaction in accordance with the terms of the Share Purchase Agreement. Our Board recommends that you vote “FOR” the authorization of the proposed sale of our Venezuelan interests.

Our Board has recognized that we have very limited choices in Venezuela. Our Board has met on several occasions to discuss the situation in Venezuela to determine the best alternative available to Harvest. Our Board believes the proposed sale of our Venezuelan interests is the best alternative we have at this time. In recommending the approval of the proposed sale, our Board considered a number of factors, both positive and negative, and potential benefits and detriments of the proposed sale. Our Board believes that the following factors support its decision to approve the sale of our Venezuelan interests and recommended that our stockholders authorize the sale:

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In the course of its deliberations, our Board also considered risks and other countervailing factors related to our entering into the Share Purchase Agreement, including the risk factors described under Risk Factors Related to the Proposed Sale of Our Venezuelan Interests beginning on page 6.

Our Board based its ultimate decision on its business judgment that the benefits of the proposed sale of our Venezuelan interests significantly outweigh the risks of alternatives to that sale. Our Board judged that the proposed sale represents the best currently available strategic alternative to preserve stockholder value, and unanimously concluded that the completion of the proposed sale pursuant to the Share Purchase Agreement is expedient, advisable, fair to and in the best interests of Harvest and our stockholders.

The preceding discussion is not, and is not intended to be, exhaustive. In light of the number and the wide variety of positive and negative factors that our Board considered in connection with its evaluation of the proposed sale of our Venezuelan interests and the complexity of these matters, our Board did not find it practicable, and has not tried, to quantify, rank or otherwise assign relative weights to the specific factors it considered. Individual members of our Board may have given different weight to different factors. Our Board considered all these factors together and, on the whole, considered them to be favorable to, and to support, its determination.

Our Board recommends that you vote “FOR” the authorization of the proposed sale of our Venezuelan interests.

Opinion of the Financial Advisor to Special Committee

The Special Committee retained TPH to act as its financial advisor and provide an opinion in connection with the sale. The Special Committee instructed TPH to evaluate the fairness, from a financial point of view, to Harvest of the consideration to be received by Harvest and HNR Energia under the Share Purchase Agreement.

On June 29, 2016, at a meeting of the Special Committee held to evaluate the transaction, TPH delivered to the Special Committee an oral opinion that, as of June 29, 2016 and based upon and subject to the assumptions, limitations and qualifications set forth in the opinion and based upon such other matters as TPH considered relevant, the consideration to be received by Harvest and HNR Energia pursuant to the Share Purchase Agreement was fair from a financial point of view to Harvest. Subsequent to rendering its oral opinion, TPH confirmed its opinion in writing to the Special Committee on June 29, 2016.

The opinion speaks only as of the date and the time it was rendered and not as of the time the transaction may be completed or any other time. The opinion does not reflect changes that may occur or may have occurred after its delivery, which could significantly alter the value, facts or elements on which the opinion was based.

The full text of TPH’s written opinion to the Special Committee, which describes, among other things, the assumptions made, procedures followed, factors considered and qualifications and limitations on the review undertaken, is attached as Appendix B to this proxy statement and is incorporated by reference in

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its entirety. The summary of TPH’s opinion set forth in this document is qualified in its entirety by reference to the full text of the opinion. Harvest stockholders are urged to read the TPH opinion carefully and in its entirety. TPH delivered its opinion for the information and assistance of the Special Committee in connection with its evaluation of the transaction. TPH’s opinion does not constitute a recommendation to any stockholder as to how to vote or act in connection with the proposed transaction or any related matter.

In connection with rendering its opinion, TPH reviewed, among other things:

TPH also held discussions with members of the senior management of Harvest regarding their assessment of the strategic rationale for, and the potential benefits of, the transaction and the past and current business operations, future prospects and financial condition of Harvest and Petrodelta, including Harvest’s projected cash shortfall in July 2016. In addition, TPH reviewed the reported price and trading activity for Harvest’s common stock, compared certain financial and stock market information for Harvest with similar information for certain other companies the securities of which are publicly traded, reviewed the financial terms of certain recent transactions in the upstream oil and gas industry specifically and in other industries generally and performed such other studies and analyses, and considered such other factors, as TPH considered appropriate.

For purposes of its opinion, TPH assumed and relied upon, without assuming any responsibility for independent verification, the accuracy and completeness of all of the financial, accounting, legal, tax, regulatory and other information provided to, discussed with or reviewed by or for it, or publicly available. In that regard, TPH assumed with the Special Committee’s consent that the forecasts for Harvest and Petrodelta prepared by the management of Harvest were reasonably prepared on a basis reflecting the best currently available estimates and judgments of Harvest, and that such management forecasts will be realized (subject to the assumption stated in the immediately following sentence) in the amounts and time periods contemplated thereby. TPH assumed, as instructed by the Special Committee and in accordance with guidance from management of Harvest, that current dividends receivable and future dividend payments from Petrodelta will not be paid to Harvest for the remaining

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term of Petrodelta’s concession with affiliates of PDVSA. Further, TPH assumed with the Special Committee’s consent that (i) the consideration in the proposed transaction will not be reduced as a result of any purchase price adjustments in the Share Purchase Agreement or otherwise, (ii) the transactions will not result in the default or acceleration of any obligation under material agreements of Harvest, HNR Energia or any of their subsidiaries and (iii) all governmental, regulatory or other consents or approvals necessary for the consummation of the transactions will be obtained without any material adverse effect on Harvest, HNR Energia, their subsidiaries or the expected benefits of the transactions in any way meaningful to TPH’s analysis. In addition, TPH did not make an independent evaluation or appraisal of the assets and liabilities (including any contingent, derivative or off-balance-sheet assets and liabilities) of Harvest, HNR Energia or any of their subsidiaries and TPH was not furnished with any such evaluation or appraisal. TPH’s opinion did not address any legal, regulatory, tax or accounting matters.

TPH’s opinion is necessarily based on economic, monetary, market and other conditions as in effect on, and the information made available to it as of June 29, 2016. TPH has disclaimed any obligation to update, revise or reaffirm its opinion, including with respect to circumstances, developments or events that occur after the rendering of its opinion.

The estimates contained in TPH’s analysis and the results from any particular analysis are not necessarily indicative of future results, which may be significantly more or less favorable than suggested by such analyses. In addition, analyses relating to the value of businesses or assets neither purport to be appraisals nor do they necessarily reflect the prices at which businesses or assets may actually be sold. Accordingly, TPH’s analysis and estimates are inherently subject to substantial uncertainty.

In arriving at its opinion, TPH did not attribute any particular weight to any particular analysis or factor considered by it, but rather made qualitative judgments as to the significance and relevance of each analysis and factor. Several analytical methodologies were employed by TPH in its analyses, and no one single method of analysis should be regarded as critical to the overall conclusion reached by TPH. Each analytical technique has inherent strengths and weaknesses, and the nature of the available information may further affect the value of particular techniques. Accordingly, TPH believes that its analyses must be considered as a whole and that selecting portions of its analyses and of the factors considered by it, without considering all analyses and factors in their entirety, could create a misleading or incomplete view of the evaluation process underlying its opinion. The conclusion reached by TPH, therefore, is based on the application of TPH’s own experience and judgment to all analyses and factors considered by it, taken as a whole. The delivery of TPH’s opinion was approved by its fairness opinion committee.

TPH’s opinion addresses only the fairness from a financial point of view, as of June 29, 2016, to Harvest of the aggregate consideration to be received by Harvest and HNR Energia under the Share Purchase Agreement. TPH’s opinion did not address the underlying business decision of Harvest or HNR Energia to engage in or consummate the transactions, or the relative merits of the transactions as compared to any other alternative transaction that might be available to Harvest or HNR Energia. TPH did not express any view on, and the fairness opinion does not address, any other term or aspect of the Share Purchase Agreement or the transactions, including, without limitation, the fairness of the transactions to, or any consideration received in connection therewith by, creditors or other constituencies of Harvest or HNR Energia; nor as to the fairness of the amount or nature of any compensation to be paid or payable to any of the officers, directors or employees of Harvest or HNR Energia, or any class of such persons, in connection with the transactions, whether relative to the consideration pursuant to the Share Purchase Agreement or otherwise. TPH did not express any opinion as to the price at which the shares of Harvest stock will trade at any time.

The data and analyses summarized herein are from TPH’s presentation to the Special Committee delivered on June 29, 2016, which primarily used market closing prices as of June 28, 2016. The analyses summarized below include information presented in tabular format. In order to fully understand the financial analyses

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performed, the tables must be considered together with the textual summary of the analyses. For purposes of its analysis, TPH defined EBITDA as net income plus income taxes, interest expense (less interest income), depreciation and amortization.

Summary of TPH’s Analysis

Commodity Price Assumptions

The commodity price assumptions used by TPH in certain of its analyses are summarized below:

New York Mercantile Exchange (“NYMEX”) Strip Pricing as of June 10, 2016 (“Strip”):

Research Consensus per Bloomberg (“Research Consensus”):

3-Year Historical Average (“Three-Year Average”):

Expected Dividend Distribution Analysis

TPH calculated implied value reference ranges by discounting projected distributions from Petrodelta. However, TPH assumed, as instructed by the Special Committee and in accordance with guidance from management of Harvest, that current dividends receivable and future dividend payments from Petrodelta will not be paid to Harvest for the remaining term of the concession with PDVSA. In light of this assumption, TPH calculated an implied valuation of $0.0.

Precedent Transaction Analysis

TPH reviewed the financial terms of Harvest’s prior agreements with PT Pertamina and Pluspetrol related to the previous failed attempts by Harvest to sell its interest in Petrodelta. TPH used the current value of approximated oil and gas revenues in the future, minus anticipated expenses, discounted using a discount rate of

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10% (“PV10”) as calculated in Petrodelta’s Reserve Reports at the time of each transaction based upon the following risk probabilities associated with the reserve categories: 100% for proved developed reserves, 90% for proved undeveloped reserves, 50% for probable reserves and 10% for possible reserves. Based on the foregoing, TPH calculated the consideration for each precedent transaction as a percentage of risked PV10 reserve value. TPH estimated that the consideration as a percentage of risked reserves for the precedent transactions ranged from the 44^th to 98^th percentiles, compared to 113^th percentile based on the terms of the Share Purchase Agreement. From this analysis, TPH calculated an implied valuation range of $49.0 million to $110.0 million.

Net Asset Value Analysis

TPH performed an illustrative asset-level Net Asset Value analysis of Petrodelta. TPH calculated the present value, as of June 9, 2016, of the pre-tax future cash flows expected to be generated in 2016 through the remaining concession period with PDVSA, which expires in October 2027, based on management’s estimates of production, operating expenses and capital expenditures. In performing this analysis, TPH applied discount rates ranging from 20.4% to 28.3%. The discount rates were based on an analysis of the weighted average cost of capital of certain comparable companies with international, diversified U.S. oil or Permian Basin reserves, all of which were adjusted for the relative risk premium (based on third party reports) associated with operating in Venezuela. TPH estimated Net Asset Value as the present value of the unlevered free cash flows generated by these estimates. For the purposes of its analysis, unlevered cash flow was calculated as EBITDA less capital expenditures. The commodity prices used to derive the cash flows through 2020 were based on Strip, Research Consensus and Three-Year Average prices. The commodity prices used to derive cash flows in 2020 and beyond were based on 2019 commodity price estimates for Research Consensus and 2020 prices for Strip. The analysis did not include $174.0 million of current dividends owed to HNR Energia (on account of the $340.2 million dividend payable to HNR Finance, HNR Energia’s indirect, 51% owned subsidiary), because of management’s assumption that such dividends will not be paid for the remaining life of the PDVSA concession. Using Strip commodity prices, the foregoing sensitivities applied to the Net Asset Value calculation for 3P reserves resulted in an implied valuation range of negative $13.0 million to negative $12.0 million. Using Research Consensus commodity prices, the foregoing sensitivities applied to the Net Asset Value calculation for 3P reserves resulted in an implied valuation range of $19.0 million to $41.0 million. Using Three-Year Average commodity prices, the foregoing sensitivities applied to the Net Asset Value calculation for 3P reserves resulted in an implied valuation range of $144.0 million to $192.0 million. In certain of the commodity price scenarios referenced above, the Net Asset Value analysis resulted in a positive present value which does not reflect management’s expectation that dividend payments will not be received from Petrodelta for the remaining life of the PDVSA concession. The expectation of not receiving any cash from Petrodelta was taken into consideration by TPH when comparing the results of the net asset value analysis to the results of the other analyses performed.

General

TPH and its affiliates, as part of their investment banking business, are continually engaged in performing financial analyses with respect to businesses and their securities in connection with mergers and acquisitions, negotiated underwritings, competitive biddings, secondary distributions of listed and unlisted securities, private placements and other transactions as well as for estate, corporate and other purposes.

TPH and its affiliates also engage in securities trading and brokerage, private equity activities, investment management activities, equity research and other financial services, and in the ordinary course of these activities, TPH and its affiliates may from time to time acquire, hold or sell, for their own accounts and for the accounts of their customers, (i) equity, debt and other securities (or related derivative securities) and financial instruments (including bank loans and other obligations) of Harvest or any of the other parties to the proposed transactions and any of their respective affiliates and (ii) any currency or commodity that may be involved in the transactions and the other matters contemplated by the Share Purchase Agreement.

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In addition, TPH and its affiliates and certain of its and their employees, including members of the team performing services in connection with the transactions, as well as certain private equity funds and investment management funds associated or affiliated with TPH in which they may have financial interests, may from time to time acquire, hold or make direct or indirect investments in or otherwise finance a wide variety of companies, including Harvest or any of the other parties to the transactions and any of their respective affiliates. TPH was not requested to, and did not, solicit indications of interest or proposals from third parties regarding the proposed transactions or any alternative transaction. TPH was not requested to, and did not, participate in the negotiation of the terms of the Share Purchase Agreement or the transactions, nor was TPH requested to, and it did not, provide any advice or services in connection with the Share Purchase Agreement or the transactions other than the delivery of its opinion described above.

TPH is an internationally recognized investment banking firm that is regularly engaged in the valuation of businesses and securities in connection with mergers and acquisitions, negotiated underwritings, secondary distributions of listed and unlisted securities, private placements and valuations for corporate and other purposes. The Special Committee selected TPH to act as its financial advisor in connection with the transaction on the basis of TPH’s experience in transactions similar to the transaction set forth in the Share Purchase Agreement, its reputation in the investment community and its familiarity with Harvest and its business.

Since 2013, TPH has provided advisory services to Harvest related to acquisition and divestiture matters, and TPH has thus far received $360,148 in compensation and expense reimbursement in connection with these engagements. TPH remains engaged to provide other investment banking services, for which TPH may receive up to $1.0 million in additional compensation from Harvest pursuant to an agreement between the parties. TPH may provide investment banking or other financial services to Harvest or any of the other parties to the transactions or their respective shareholders or affiliates in the future. In connection with such investment banking or other financial services, TPH may receive compensation.

The description set forth above constitutes a summary of the analyses employed and factors considered by TPH in rendering its opinion to the Special Committee. TPH believes that its analyses must be considered as a whole and that selecting portions of its analyses, without considering all analyses and factors, could create an incomplete view of the process underlying its opinion. The preparation of a fairness opinion is a complex, analytical process involving various determinations as to the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances and is not necessarily susceptible to partial analysis or summary description.

No company or transaction used in the analyses of comparable transactions summarized above is identical or directly comparable to Harvest, Petrodelta or the transaction. Accordingly, these analyses must take into account differences in the financial and operating characteristics of the selected publicly traded companies and differences in the structure and timing of the selected transactions and other factors that would affect the public trading value and acquisition value of the companies considered.

Pursuant to the terms of the Special Committee’s engagement of TPH, TPH became entitled to receive $1.0 million upon the Special Committee’s request that TPH render a fairness opinion (regardless of the conclusion reached therein). In addition, Harvest has agreed to reimburse TPH for its reasonable out-of-pocket expenses incurred in connection with the engagement, including fees and disbursements of its legal counsel. Harvest also agreed to indemnify TPH, its affiliates and their respective officers, directors, partners, agents, employees and controlling persons for certain liabilities related to or arising out of its rendering of services under its engagement, including liabilities under the federal securities laws, or to contribute to payments TPH may be required to make in respect of these liabilities.

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Results of Consummation of Proposed Transaction

If all conditions to the closing of the transaction described in the Share Purchase Agreement are met or otherwise waived (if permitted to be waived), the following will occur:

As a result of the closing of the transaction, our primary non-cash asset will be our oil and gas interests in Gabon. See – Information About Harvest – Business beginning at page 48.

Also as a result of the closing of the transaction, we may be obligated to make certain change of control payments to members of our management. For a description of these obligations, see – Interests of Harvest’s Directors and Executive Officers in the Proposed Sale beginning on page 71.

For information on the financial effects of consummating the transaction, see – Information About Harvest – Unaudited Pro Forma Consolidated Financial Statements beginning on page 60

Use of Proceeds and Nature of Our Business Following the Proposed Sale

If the proposed sale of our Venezuelan interests is completed, a significant portion of our assets will be cash from the proceeds of the sale. Operating and capital requirements related to the portfolio of retained assets in Gabon at the time of the closing will influence the determination by our Board of the size of any cash distribution to the stockholders from the proceeds of the closing. For clarity, the possible sale of our non-Venezuelan asset before the closing would diminish the need for us to retain proceeds from the closing. Depending on the timing of these events, we anticipate using a portion of the proceeds from the closing as follows:

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We will use the remainder of the proceeds as our Board, in its discretion, determines, based on its determination of what is in the best interests to us and our stockholders at the time a decision is made. In addition to the possibility that our Board may use part of the proceeds to pay a dividend or other distribution to our stockholders, it is also possible that our Board may use part of the proceeds to continue our business. For a description of our non-Venezuelan asset and operations, see Information About Harvest. For a description of the tax consequences of the sale of our Venezuelan interests, see Proposal No. 1 – Terms of the Proposed Sale of Our Venezuelan Interests – Material Income Tax Consequences of the Proposed Sale.

Before making any decisions with respect to paying a dividend or other distribution to our stockholders, our Board 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 considers these matters.

We intend to continue our consideration of a possible sale of our non-Venezuelan asset if we are able to negotiate a sale or sales in transactions that our Board believes are in the best interests of us and our stockholders. In the meantime, we intend to operate our business in the ordinary course and may ultimately decide to keep our non-Venezuelan asset and acquire additional assets. 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 Venezuelan interests. We also currently expect that our common stock will continue to be traded on the NYSE or another appropriate exchange as long as we meet applicable listing requirements.

Accounting Treatment of the Proposed Sale

Under Accounting Standards Codification (“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 of 1986, as amended (the “Code”), and regulations.

Prior to 2013, no United States (“U.S.”) taxes had been recorded on the unremitted earnings of our non-U.S. subsidiaries as it was our practice and intention to reinvest the earnings of those non-U.S. subsidiaries into our foreign operations. During the fourth quarter of 2013 and in subsequent periods, management evaluated numerous factors related to the timing and amounts of possible future distribution of foreign earnings to the parent company, with consideration of the sale of non-U.S. assets. Because management was pursuing various alternatives with respect to Harvest’s future operations and disposition of any sale proceeds, a determination was made that it was appropriate to record a deferred tax liability associated with the unremitted earnings of our foreign subsidiaries. However, due primarily to impairments of our Venezuelan cost investment, the deferred tax liability associated with the foreign earnings was reduced to zero as of December 31, 2015.

As noted below, Harvest is expected to realize a gain for U.S. income tax purposes on closing of the sale although not all of that gain may be currently recognized due to exceptions under U.S. tax rules. As a result of

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the sale, we expect that the tax impact for financial reporting purposes primarily will be attributable to any U.S. deferred tax liability recorded on the gain on sale realized for income taxes purposes but currently deferred from U.S. taxation. On closing of the sale, Harvest will review its intentions with respect to the earnings derived that would be deferred from current U.S. taxation to determine if a U.S. deferred tax liability should be recorded on those earnings.

Management assessed the available positive and negative evidence related to its U.S. net operating losses, AMT credit carryforwards, and other U.S. deferred tax assets to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. After reviewing the earnings history of our operations and the possible future operations of Harvest, management has determined that we may not have sufficient taxable income in the U.S. following the closing of the sale. Consequently, the valuation allowance currently offsetting our U.S. deferred tax assets has remained in-place.

Material Income Tax Consequences of the Proposed Sale

Material U.S. Federal Income Tax Consequences

The following discussion is a general summary of the anticipated U.S. federal income tax consequences of the sale of our Venezuelan interests. The following discussion is based on the Code, its legislative history, currently applicable and proposed Treasury regulations under the Code and published rulings and decisions, all as currently in effect as of the date of this proxy statement, and all of which are subject to change, possibly with retroactive effect. Tax considerations under state and local laws, or federal laws other than those pertaining to income tax, are not addressed in this proxy statement. The following discussion has no binding effect on the Internal Revenue Service (“IRS”) or the courts.

Consequences to the Stockholders of Harvest

There should be no U.S. federal income tax consequence to the stockholders of Harvest as a result of the sale of our Venezuelan interests, as the gain will be realized by Harvest, through HNR Energia. However, stockholders may incur a tax if they receive dividends or other distributions from Harvest of any proceeds from the sale of our Venezuelan interests, or they sell or otherwise dispose of their stock in Harvest in a taxable transaction at a price higher than their adjusted tax basis in that stock. You are urged to consult your own tax advisor with respect to the U.S. federal income, as well as state, local, and non-U.S., tax consequences to you of receiving distributions on, or disposing of, the stock you hold in Harvest.

Consequences to Harvest

Harvest may be subject to U.S. federal income tax arising from the gain on the sale of our Venezuelan interests. The gain realized by HNR Energia is potentially subject to the Subpart F rules of the Code, which could cause all or a portion of the gain realized to be currently taxable to Harvest. However, to the extent that HNR Energia’s earnings from the sale qualify for an exception to the Subpart F rules, U.S. taxation of those earnings should be deferred until the earnings are distributed or deemed distributed to Harvest. If any portion of the gain is currently subject to tax in the U.S., the taxable portion can be further reduced by any U.S. tax losses available to Harvest.

Material Dutch Income Tax Consequences

There will be no material Dutch tax consequences to Harvest or its affiliates as a result of the sale of our Venezuelan interests. Capital gains arising from HNR Energia’s sale of shares in Harvest Holding will be fully exempt from corporate income tax as a result of the Dutch participation exemption.

Material Venezuelan Income Tax Consequences

There should be no Venezuelan income tax consequences to Harvest or its affiliates arising as a result of the sale of our Venezuelan interests because no Venezuelan entities will be sold. Instead, the shares to be sold by

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HNR Energia are those of a Dutch BV (i.e., Harvest Holding), that indirectly owns stock in the Venezuelan entities. The sale of our Venezuelan interests will be consummated outside of Venezuela between HNR Energia, a Curacao company that is tax resident in the Netherlands, and CT Energy, a Barbados Society with Restricted Liability.

Regulatory Matters

We are not aware of any antitrust or other material regulatory consents that are required in connection with the sale of our Venezuelan interests, except for the approval by the Ministerio del Poder Popular de Petroleo y Mineria, representing the Government of Venezuela. As of the date of this proxy statement, the Ministerio del Poder Popular de Petroleo y Mineria has not approved the transaction.

DESCRIPTION OF INTERESTS TO BE SOLD

Under the Share Purchase Agreement, Harvest and HNR Energia agreed to sell all of HNR Energia’s 51% equity interest in Harvest Holding to CT Energy. Harvest Holding owns, indirectly through wholly owned subsidiaries, a 40% equity interest in Petrodelta. The sale of our equity interest in Harvest Holding, including its direct and indirect subsidiaries, will constitute the sale of all of our interests in Venezuela, which consists of an indirect 20.4% equity interest in Petrodelta (owned through our 51% equity interest in Harvest Holding).

This section of the proxy statement (Description of Interests to Be Sold) relates only to our Venezuelan interests. For information regarding other aspects of our operations, see – Information About Harvest beginning on page 48.

General

Before 2007, we operated our Venezuelan assets through an operating service agreement between us and an affiliate of PDVSA to develop certain oil and gas fields in Venezuela. In 2005, the Government of Venezuela initiated a series of actions to compel companies with operating services agreements to convert those agreements into new, “mixed” companies in which PDVSA has a majority interest. While these actions adversely affected our operations in Venezuela, we were able to negotiate a joint mixed company agreement with the Government of Venezuela under which Petrodelta was formed. In October 2007, the Venezuelan Presidential Decree, which formally transferred to Petrodelta the rights to the fields we operated, was published in the Official Gazette, the official government publication where laws, decrees, resolutions, instructions and other regulations of general interest issued by the Government of Venezuela are published, to make those acts valid and official.

Petrodelta is responsible for the exploration, development, production, gathering, transportation and storage of hydrocarbons in six fields. Petrodelta’s current portfolio of properties in eastern Venezuela includes large proven oil fields as well as properties with substantial opportunities for both development and exploration. Petrodelta has 247,113 gross acres (50,411 net acres to our interest) under concessions. Approximately 88% of the acreage is undeveloped, which we believe provides us with substantial opportunities for multi-year development upside through our concession period, which expires in October 2027. Petrodelta is governed by its own charter and bylaws and its stockholders intend that the company be self-funding and rely on internally generated cash flow.

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

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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 had, and may continue to have, 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 sulfur 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 stockholders and was executed during the first quarter 2015. Natural gas delivered from the Petrodelta fields to PPSA is priced at $1.54 per MMcf. 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 Government of Venezuela published in the Official Gazette the Law Creating a Special Contribution on Extraordinary Prices and Exorbitant Prices in the International Hydrocarbons Market (the “Windfall Profits Tax”). See Management’s Discussion and Analysis of Financial Condition and Results of Operations beginning on page C-62 for a discussion of the effects of the 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 B.V., a wholly owned subsidiary of Harvest Holding that owns a 40% interest in Petrodelta (“HNR Finance”). Petrodelta stockholder 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, the 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 was classified as a long-term receivable at December 31, 2014 due to the uncertainty in the timing of payment. During the year ended December 31, 2014 we recorded an allowance of $12.2 million to fully reserve the dividend receivable due from Petrodelta.

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. The Government of Venezuela modified the currency exchange system whereby the official exchange rate of 6.3 Bolivars per U.S. dollar would only apply to certain economic sectors related to purchases of “essential goods and services” while other sectors of the economy would be subject to a new exchange rate, SICAD I, determined by an auction process conducted by Venezuela’s Complimentary System of Foreign Currency Administration. Participation in the SICAD I mechanism is controlled by the Government of Venezuela and is limited to certain companies that operate in designated economic sectors. In March 2014, an additional currency exchange mechanism was established by the Government of Venezuela that allows companies within other economic sectors to participate in an additional auction process (“SICAD II”). The financial information for Petrodelta is prepared using the official fixed exchange rate (6.3 from February 2013 through December 2014).

On February 10, 2015, the Ministry of Economy, Finance, and Public Banking, and the Central Bank of Venezuela (BCV) published in the Extraordinary Official Gazette No.6.171 Exchange Agreement No. 33 with two Official Notices. The first notice said that the SICAD II exchange rate would be no longer permitted. The second notice said that a new exchange rate called the Foreign Exchange Marginal System (“SIMADI”) has been created. The SIMADI rate published on December 31, 2015 is 198.70 Bolivars per U.S. dollar. The SIMADI’s marginal system is available in limited quantities for individuals and companies to purchase and sell foreign currency via banks and exchange houses.

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On December 16, 2013, we entered into a purchase agreement under which, among other things, we sold a 29% interest in Harvest Holding to Petroandina and agreed to sell our remaining 51% interest in Harvest Holding at a future time. Under this purchase agreement, Petroandina has the right to any dividends paid by Harvest Holding after December 16, 2013 that would attach with respect to its current 29% interest regardless of whether the dividends are paid in connection with dividends paid by Petrodelta that are declared before, on or after the date of our purchase agreement with Petroandina dated December 16, 2013 and regardless of the record date therefor. 

Through December 31, 2014, we included the results of Petrodelta in our consolidated financial statements using the equity method of accounting. We ceased recording earnings from Petrodelta in the second quarter of 2014 due to the expected sales price in the second closing under the Petroandina purchase agreement approximating the recorded value of our investment in Petrodelta. Due to our failed sales attempts, lack of management influence, and actions and inactions by the majority owner, PDVSA, we believe we no longer exercise significant influence in Petrodelta and in accordance with Accounting Standards Codification “ASC 323 – Investments – Equity Method and Joint Ventures,” we are accounting for our investment in Petrodelta under the cost method (“ASC 325 – Investments – Other”), effective December 31, 2014. Under the cost method we will not recognize any equity in earnings from our investment in Petrodelta in our results of operations, but will recognize any cash dividends as income in the period they are received.

We have been required under applicable accounting principles to assess our assets in Venezuela for impairment. As of December 31, 2014, we recorded a pre-tax impairment charge against the carrying value of our investment of $355.7 million. Our impairment analysis was based on the estimated fair value of Petrodelta’s oil and natural gas properties and other net assets as of December 31, 2014, discounted by a factor for economic instability, foreign currency risks and lack of marketability. As of December 31, 2015, we concluded that the estimated fair value of our investment in Petrodelta was nil and recorded a pre-tax impairment charge of $164.7 million to fully impair the investment. Our impairment analysis was prompted by the continued decline in world oil prices and deteriorating economic conditions in Venezuela.

On January 4, 2016, HNR Finance made a loan to CT Energia in the amount of $5.2 million under an 11% promissory note due 2019, dated January 4, 2016, executed by CT Energia (the “CT Energia Note”). The purpose of the loan was to provide CT Energia with collateral to obtain funds for one or more loans to Petrodelta. The loans to Petrodelta are to assist Petrodelta in satisfying its working capital needs and discharging its obligations. Interest on the CT Energia Note is due and payable on the first of each January and July, commencing July 1, 2016. The full amount outstanding, including any unpaid accrued interest, is due on January 4, 2019; however, HNR Finance’s sole recourse for payment of the principal amount of the loan is the payments of principal and interest from loans that CT Energia has made to Petrodelta. No interest payments have been made under the CT Energia Note as of August 1, 2016. If and when CT Energia receives any payments of principal or interest from loans it has made to Petrodelta, then those proceeds must be used to prepay unpaid interest and principal under the CT Energia Note. The source of funds for HNR Finance’s $5.2 million loan to CT Energia was a capital contribution from Harvest Holding, which, in return, received the same aggregate amount of capital contributions from its stockholders, pro rata according to their equity interests in Harvest Holding. Of that aggregate amount of capital contributions, HNR Energia contributed $2.6 million, which it had received as a capital contribution from Harvest. The CT Energia Note would be transferred to CT Energy as part of the proposed sale of our Venezuelan interests.

Location and Geology

Uracoa Field

At December 31, 2015, there were 52 (compared to 66 at December 31, 2014) oil and natural gas producing wells and six (compared to seven at December 31, 2014) 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 natural gas station and PDVSA’s natural gas network.

Tucupita Field

At December 31, 2015, there were 15 (compared to 17 at December 31, 2014) oil producing wells and five (compared to five at December 31, 2014) 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, 2015, there were four (compared to four at December 31, 2014) 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, 2015, there were nine (compared to eight at December 31, 2014) 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 oil produced.

Temblador Field

At December 31, 2015, there were 31 (compared to 31 at December 31, 2014) oil producing wells in the field, and eight (compared to eight at December 31, 2014) water injection 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, 2015, there were 31 (compared to 23 at December 31, 2014) oil producing wells and one (compared to one at December 31, 2014) 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 MBbls of oil per day and a design capacity of 60 MBbls of oil per day.

Petrodelta has a 64-mile pipeline from Uracoa to the Mamo natural gas station and the PDVSA natural 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 MBbls of fluid per day and a design capacity of 60 MBbls of oil per day. The second gathering system, 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 MBbls of oil per day and a design capacity of 40 MBbls 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 natural gas affiliate for purchase of power for electrical needs, leasing of compression, and operation and maintenance of the natural gas treatment and compression facilities at the Uracoa and Tucupita fields.

Drilling and Development Activity

During the year ended December 31, 2015, Petrodelta drilled and completed 18 development wells. Petrodelta delivered approximately 14.8 MBbls of oil and 3.9 billion cubic feet (“Bcf”) of natural gas, averaging 42,237 barrels of oil equivalent (“BOE”) per day during the year ended December 31, 2015.

During the year ended December 31, 2014, Petrodelta drilled and completed 13 development wells. Petrodelta delivered approximately 15.6 MBbls of oil and 3.0 Bcf of natural gas, averaging 43,994 BOE per day during the year ended December 31, 2014. During the year ended December 31, 2013, Petrodelta drilled and completed 13 development wells, delivered approximately 14.5 MBbls of oil and 2.6 Bcf of natural gas, averaging 41,014 BOE per day during the year ended December 31, 2013.

Currently, Petrodelta is operating five drilling rigs and one workover rig and is continuing with infrastructure enhancement projects in the El Salto and Temblador fields.

Reserve Report

As of December 31, 2014, we changed our accounting for our investment in Petrodelta from the equity interest method to the cost method. As a result, and because of other factors, our reserves would be recorded at zero under applicable standards. Therefore we did not include reserve information in our Annual Report on Form 10-K for the year ended December 31, 2015 and do not include any such information in this proxy statement.

Production, Prices and Lifting Cost Summary

In the following table we have set forth, for Venezuela, our net production, average sales prices and average operating expenses for the years ended December 31, 2015, 2014 and 2013. The presentation for Venezuela shows our net ownership interest in Petrodelta which was 32% through December 15, 2013 and 20.4% thereafter.

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Other Information

Information on drilling and developed acreage, regulation environmental regulation, competition, properties and legal proceedings, as those items relate to our Venezuelan interests, is included under the heading Information About Harvest beginning on page 48.

Petrodelta Restructuring Negotiations

Our representatives, including representatives of CT Energy and CT Energia, and representatives of CVP, which, along with PDVSA, owns 60% of Petrodelta, negotiated a non-binding term sheet that sets forth a framework for definitive agreements for the restructuring of the management and operations of Petrodelta, as described below. A preliminary version of the term sheet was signed by us on June 18, 2015, and the final version of the term sheet was signed by all parties, including CVP, PDVSA and HNR Finance, as of July 14, 2015.

In general, the CVP term sheet provides for:

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We continue to believe that entering into the term sheet with CVP eventually could help us resolve the historical lack of cash flows from Petrodelta and enhance Petrodelta’s ability to finance operations and expansion. However, there can be no assurances that the definitive agreements described in the CVP term sheet will be entered into, or that suitable financing will be obtained to make the required cash contributions to Petrodelta. Because of these continuing uncertainties regarding whether our negotiations with CVP and PDVSA will lead to a successful resolution of the matters discussed above, including entering into binding definitive agreements in accordance with the term sheet, and because our discussions along these lines have been ongoing for over a year, we have come to the conclusion that selling our Venezuelan interests to CT Energy under the terms of the Share Purchase Agreement, assuming that all conditions to closing can be satisfied, would provide us and our stockholders with a preferable course of action. For information regarding our previous efforts to sell our Venezuelan interests, see --The Proposed Sale - Background of the Proposed Sale beginning on page 14. If we are not able to consummate the sale of our Venezuelan interests pursuant to the Share Purchase Agreement with CT Energy, we will continue our negotiations with CVP and PDVSA to try to successfully implement the financial and operational restructuring of Petrodelta, but there can be no assurances that we will be able to do so.

DOCUMENTS GOVERNING THE PROPOSED SALE

The following is a summary of the material documents relevant to the proposed sale of our Venezuelan interests. The Share Purchase Agreement is attached to this proxy statement as Appendix A and is incorporated by reference into this proxy statement. This summary does not purport to be complete and may not contain all of the information that is important to you. To understand the proposed sale of our Venezuelan interests more fully, and for a more complete legal description of the proposed sale, you are urged to read this entire proxy statement carefully, including the appendices.

The description of each of the documents governing the proposed sale of our Venezuelan interests have been included to provide you with general information regarding the terms of each document. Except for the status of each document as a contractual document among the parties with respect to the proposed sale, these descriptions are not intended to provide factual information about any of the parties. The documents may contain representations and warranties made by the parties as of specific dates or based on a party’s knowledge and belief, may be subject to limitations agreed on by the contracting parties, including being qualified by confidential disclosures made for the purposes of allocating risk between the parties instead of establishing these matters as facts, and may apply standards of materiality in a way that is different from what may be viewed as material by you or by other investors. You should not rely on the representations and warranties set forth in these documents as statements of factual information.

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Share Purchase Agreement

General

We, HNR Energia, and CT Energia entered into the Share Purchase Agreement on June 29, 2016. An overview of some of the terms and conditions of the Share Purchase Agreement is provided below. This overview is not intended to be a complete description of all of the terms and conditions in the Share Purchase Agreement and you are urged to read the Share Purchase Agreement in its entirety.

We own 100% of HNR Energia. HNR Energia owns 51% of the equity interests in Harvest Holding, which is the interest to be sold to CT Energy under the Share Purchase Agreement. Harvest Holding, through subsidiaries, has a 40% interest in Petrodelta. For more information about the entities owning Petrodelta, including an organizational chart, see – The Proposed Sale – Parties Related to the Proposed Sale beginning on page 10.

At the closing described in the Share Purchase Agreement, HNR Energia will transfer its 51% interest in Harvest Holding in exchange for:

The cash portion of the purchase price will be:

The 15% Note and the Additional Draw Note will be cancelled after the closing.

For information about the 15% Note, the Additional Draw Note and the CT Warrant, see – The Proposed Sale – Background of the Proposed Sale beginning on page 14. For information about CT Energy’s commitment to make loans from time to time under the Additional Draw Note, see – CT Energy’s Funding Covenant beginning on page 45.

Closing

The closing will take place within ten business days after the date on which the conditions to the closing set out in the Share Purchase Agreement have been satisfied or waived (other than those conditions that by their terms are to be satisfied at the closing), or at such other time as the parties may agree.

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Conditions to the Proposed Sale

The following conditions must be satisfied before consummation of the proposed sale of our Venezuelan interests:

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For information about the Shareholders’ Agreement, Securities Purchase Agreement and Management Agreement, see – The Proposed Sale – Background of the Proposed Sale beginning on page 14.

Representations and Warranties

The representations and warranties made in the Share Purchase Agreement do not purport to be accurate as of the date of this proxy statement or to provide factual information about the parties to the Share Purchase Agreement.

Representations and Warranties of Harvest and HNR Energia

We made various representations and warranties in the Share Purchase Agreement. Our representations and warranties relate to, among other things:

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Representations and Warranties of CT Energy

CT Energy made various representations and warranties in the Share Purchase Agreement. Its representations and warranties relate to, among other things:

Certain Actions Before the Closing

Until the closing of the sale of our Venezuelan interests, we have agreed to cause Harvest Holding and its subsidiaries to conduct their business in the ordinary course consistent with past practice. We have agreed that before the closing HNR Energia will not, and will not permit Harvest Holding or its subsidiaries to:

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However, with respect to any actions taken or omitted to be taken by CT Energia with respect to Harvest Holding or its subsidiaries, our obligations only apply to the extent that we have knowledge of the action or omission and have the right to consent to or veto the action or omission pursuant to the Management Agreement. For information about the Management Agreement with CT Energia, see – The Proposed Sale – Background of the Proposed Sale beginning on page 14.

Other Covenants of Harvest and HNR Energia

Under the Share Purchase Agreement, we have made a number of other covenants, including the following:

Covenants of Harvest, HNR Energia and CT Energy

The parties have made a number of other covenants, including the following:

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CT Energy’s Funding Covenant

To fund our transaction expenses and operations until the closing, CT Energy has agreed to lend $2.0 million to us under the Additional Draw Note on each of July 19, August 19, September 19, October 19, and November 21, 2016. CT Energy’s funding commitment under the Share Purchase Agreement terminates on the earlier of the closing of the transaction and the termination of the Share Purchase Agreement. As of the date of this proxy statement the outstanding principal amount under the Additional Draw Note is $4.0 million, consisting of $2.0 million loans made to us on each of June 20, 2016 (before the Share Purchase Agreement was executed) and July 19, 2016. We expect that the outstanding principal under the Additional Draw Note will increase to $6.0 million on August 19, 2016 and to $8.0 million on September 19, 2016. The principal outstanding under Additional Draw Note cannot exceed $12.0 million in the aggregate, and the Additional Draw Note bears interest at a rate of 15.0%, compounded quarterly.

Fiduciary Out

We have agreed that, while the Share Purchase Agreement is in effect, we will not solicit offers to acquire (1) any equity interests in Harvest Holding, its subsidiaries or Petrodelta, (2) any assets of Harvest Holding, its subsidiaries or Petrodelta, (3) 20% or more of the equity interests in us or HNR Energia, or (4) 20% or more of the assets in us or HNR Energia. If we receive an unsolicited offer, we may not engage in negotiations or substantive discussions with, or furnish any information and reasonable access to, any third party making the offer or its representatives unless the Special Committee determines in good faith, after consultation with the Special Committee’s outside legal and financial advisors, and based on information then available, that the offer constitutes, or is reasonably likely to result in, a “superior proposal” (as defined in the Share Purchase Agreement and further discussed below) and we comply with other contractual requirements, including giving written notice to CT Energy after any such determination by the Special Committee and before taking any of the actions described above, providing information regarding the third party and its offer to CT Energy, entering into an acceptable confidentiality agreement with the third party and providing to CT Energy any material nonpublic information furnished to the third party.

We have the right to terminate the Share Purchase Agreement to accept a third party proposal if the Special Committee determines in good faith (after consultation with its outside legal counsel and financial advisor) that the third party proposal constitutes a superior proposal and that the failure to approve or recommend the superior proposal would be inconsistent with the fiduciary duties to our stockholders under applicable law. Before terminating the Share Purchase Agreement, we must (at CT Energy’s request) engage in good faith negotiations with CT Energy regarding the terms of the Share Purchase Agreement, and the Special Committee must consider any adjustments in the Share Purchase Agreement proposed by CT Energy and determine in good faith (after consultation with its outside legal counsel and financial advisor) that the superior proposal continues to be superior. In addition, we may not terminate the Share Purchase Agreement unless, concurrently with the termination, we pay CT Energy a break-up fee of $4.6 million and all outstanding principal and accrued interest under the 15% Note and the Additional Draw Note.

A “superior proposal” is defined in the Share Purchase Agreement to mean and acquisition proposal that if consummated would result in the third party making the acquisition proposal owning, directly or indirectly (1) all of the equity interest in Harvest or HNR Energia or all of the assets of Harvest or HNR Energia (in each case assuming that the acquisition proposal is conditioned on the termination of the Share Purchase Agreement Agreement), (2) 51% of the equity interests of Harvest Holding or 100% of the assets of Harvest Holding, or (3) 100% of all of the assets of all the subsidiaries of Harvest Holding, made by a third party as to which the Special Committee determines in good faith, after consultation with its representatives, and considering such factors as the Special Committee considers in good faith to be appropriate (including the tax consequences), (A) is on terms that are more favorable to our stockholders than the transactions contemplated by the Share Purchase Agreement (after giving effect to all changes to the terms of Share Purchase Agreement proposed by CT Energy in response to the acquisition proposal) from a financial point of view, (B) is not conditioned on the receipt of financing and (C) is reasonably likely to be consummated on a timely basis.

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Termination

The Share Purchase Agreement may, by written notice given before or at the closing, be terminated, among other reasons:

Termination Consequences

Under the Share Purchase Agreement, we must pay CT Energy a break-up fee of $4.6 million and pay all principal and interest under the 15% Note and the Additional Draw Note (as well as any make-whole premiums) if the Share Purchase Agreement is terminated:

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Under the Share Purchase Agreement, we must pay CT Energy a break-up fee of $4.6 million if the Share Purchase Agreement is terminated:

Under the Share Purchase Agreement, we are entitled to draw $15 million under the Letter of Credit if the Share Purchase Agreement is terminated:

If the Share Purchase Agreement is terminated and we are not entitled to draw funds under the Letter of Credit, then the Letter of Credit will be terminated and returned undrawn to CT Energy and JP Morgan Chase Bank.

Amendment

The Share Purchase Agreement may be amended in writing by mutual agreement of the parties at any time before or after we receive approval from our stockholders for the proposed sale. After we receive stockholder approval, there will not be any amendment that by law requires further approval by our stockholders without obtaining further stockholder approval.

Applicable Law and Jurisdiction

The Share Purchase Agreement is governed by Delaware law, except the deed for the transfer of the shares of Harvest Holding and related stockholders’ resolutions or minutes of Harvest Holding related to the deed are governed by the laws of the Netherlands.

Guaranty of Harvest Natural Resources, Inc.

Harvest has agreed to guarantee HNR Energia’s obligations under the Share Purchase Agreement.

Related Documents

Letter of Credit

Concurrently with the signing of the Share Purchase Agreement, CT Energy provided us with the Letter of Credit described under –The Proposed Sale – Terms of the Proposed Sale of Our Venezuelan Interests beginning on page 12. The $15 million will be paid to HNR Energia as liquidated damages, by way of a draw on the Letter of Credit, upon (1) the termination of the Share Purchase Agreement as a result of a material breach by CT Energy, or (2) the termination of the Share Purchase Agreement when all conditions precedent, other than the approval by the Government of Venezuela and conditions that can be satisfied only by CT Energy at the closing, have been satisfied or waived (to the extent permitted by law). If the Share Purchase Agreement is terminated for any other reason, the Letter of Credit will be returned undrawn to CT Energy and JP Morgan Chase Bank.

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We are also entitled to draw on the Letter of Credit within 10 business days of the expiration of the Letter of Credit if the Share Purchase Agreement has not been terminated, and as of such date, CT Energy has failed to deliver or cause to be delivered a replacement letter of credit and our Board has authorized a draw on the Letter of Credit. In this case, we are required to hold the $15 million proceeds in trust for disbursement to either Harvest or CT Energy pursuant to the terms of the Share Purchase Agreement.

Promissory Note and Guaranty

Under the Share Purchase Agreement, CT Energy agreed to pay part of the consideration for the sale of our Venezuelan assets in the form of an unsecured promissory note payable by CT Energy or its designee (the “CT Energy Note”). The CT Energy Note will be in the principal amount of $12 million, bear interest of 11% per annum, and become due and payable six months after the date of the closing.

Also under the Share Purchase Agreement, CT Energy agreed that its sole member and 100% owner, Oswaldo Cisneros, will guarantee the CT Energy Note by signing and delivering a guaranty.

Release

Under the Share Purchase Agreement, we will deliver to CT Energy at the closing a release of all claims that we, HNR Energy or any of our affiliates (other than Harvest Holding and its subsidiaries) may have against  Harvest Holding or its subsidiaries.

INFORMATION ABOUT HARVEST

Business

Executive Summary

Harvest Natural Resources, Inc. is a petroleum exploration and production company incorporated under Delaware law in 1988. 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 own and have developed significant interests in Venezuela. In addition to our interests in Venezuela, we hold exploration acreage offshore of Gabon. We operate from our Houston, Texas headquarters. We also have a regional office in Caracas, Venezuela and a field office in Port-Gentil, Gabon to support operations in those areas.

This section of the proxy statement (Information About Harvest) relates primarily to our operations in general and outside of Venezuela. For information regarding our Venezuelan interests, see – Description of Interests to Be Sold beginning on page 32.

In addition to our interests in Venezuela, we have a 66.667% ownership interest in the Dussafu Production Sharing Contract (“Dussafu PSC”) and we are the operator. The Dussafu PSC, which is located offshore Gabon, covers an area of 680,000 acres with water depths up to 1,650 feet. In December 2014, we recorded a $50.3 million impairment related to the unproved costs of the Dussafu PSC based on a qualitative analysis which considered our current liquidity needs, our inability to attract additional capital and the decrease in oil and natural gas prices. In December 2015, we reassessed the carrying value of the unproved costs related to the Dussafu PSC and recorded an additional impairment of $23.2 million based on an analysis of the value of the unproved costs which considered the value of the contingent and exploration resources and our ability to develop the project given its current liquidity situation and the depressed price of crude oil We also impaired the oilfield inventory related to our property in Gabon by $1.0 million, leaving $3.0 million related to this inventory. We recorded the oilfield inventory impairment based on the decrease in demand for inventory due to continued decreases in oil

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prices. Operational activities during the year ended December 31, 2015, included continued evaluation of development plans, based on the 3D seismic data acquired in late 2013 and processed during 2014.

As of December 31, 2015, we had total assets of $47.8 million, unrestricted cash of $7.8 million and debt, net of discount, of $0.2 million. For the year ended December 31, 2015, we had no revenues from continuing operations and net cash used in operating activities of $23.9 million. As of December 31, 2014, we had total assets of $228.0 million, unrestricted cash of $6.6 million and a note payable to controlling interest owner of $13.7 million. For the year ended December 31, 2014, we had no revenues from continuing operations and net cash used in operating activities of $39.2 million.

We expect that in 2016 we will not generate revenues and will continue to generate losses from operations and our operating cash flows will not be sufficient to cover our operating expenses. While we believe that we may be able to raise additional capital through issuance of debt or equity or through sales of assets, our circumstances raise substantial doubt about our ability to continue as a going concern.

Business Strategy

We are currently negotiating the management and structure of our investment in Petrodelta. In July 2015, HNR Finance entered into a non-binding term sheet with CVP and PDVSA. The term sets forth a framework for definitive agreements that would govern the restructuring of the management and operations of Petrodelta. Because the term sheet is non-binding and subject to several conditions precedent, we cannot guarantee that HNR Finance will be able to consummate the transactions contemplated by the term sheet. Given the concentration of our assets in Petrodelta, our results of operations and financial conditions could be adversely affected if we are unable to consummate the restructuring of the management and operations of Petrodelta, as contemplated by the term sheet.

Harvest is considering options to develop, sell or farm-down its interest in the Dussafu PSC to obtain the maximum value from the asset, while maintaining the required liquidity to continue our current operations.

Our financial statements have been prepared under the assumption that we will continue as a going concern, which contemplates that we will continue in operation for the foreseeable future and will be able to realize assets and settle liabilities and commitments in the normal course of business.

Available Information

We file annual, quarterly and current reports, proxy statements and other documents with the SEC under the 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 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 the 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 and principal financial and 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

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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.

Dussafu Marin, Offshore Gabon

General

In 2008, we acquired a 66.667% 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 third exploration phase expired May 27, 2016. Expiration of the exploration phase has no effect on the discovered fields under the Exclusive Exploitation Authorization (“EEA”) as discussed below.

On March 26, 2014, the joint venture partners approved a resolution that the discovered fields are commercial to exploit. On June 4, 2014, a declaration of commerciality was signed with Gabon pertaining to four discoveries on the Dussafu Project offshore Gabon. Furthermore, on July 17, 2014, the Direction Generale Des Hydrocarbures awarded an EEA for the development and exploitation of certain oil discoveries on the Dussafu Project and on October 10, 2014, the field development plan was approved. We have four years from the date of the EEA approval to begin production.

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 exist in the blocks contiguous to the Dussafu PSC.

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 the 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. 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 downhole tool was retrieved and the DTM-1 and DTM-1ST1 were suspended for future re-entry.

We have met all funding commitments for the third exploration phase of the Dussafu PSC.

Operational activities during the year ended December 31, 2015, included continued evaluation of development plans based on the 3D seismic data acquired in late 2013 and processed during 2014.

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Central/Inboard 3D seismic data acquired in 2011 has been processed and interpreted to evaluate prospectivity. We have also completed processing data from the 1,260 sq. km 3D seismic survey acquired during the fourth quarter of 2013. This survey provides 3D coverage over the outboard portion of the block and has confirmed significant pre-salt prospectivity which had been inferred from 2D seismic data. The new 3D seismic data also covers the Ruche, Tortue and Moubenga discoveries and we expect will facilitate the effective placement of future development wells in the Ruche and Tortue development program, as well as allowing improved assessment of the numerous undrilled structures already identified on older 3D seismic surveys.

Since approval of the Field Development Plan (“FDP”) in October 2014, Harvest has continued to move toward development of the Ruche Exclusive Exploitation Area. A tender for all the subsea equipment was concluded in January 2015 where prices exceeded the costs employed in the FDP. Efforts continue to negotiate with the lowest priced vendors and to revise the development scheme to bring the projected cost back to the FDP levels. The depth volume from the 2013 3D seismic acquisition over the discovered fields and the outboard area of the license has been received and interpreted.

This new data was incorporated into our reservoir models and optimization of well trajectories to maximize oil recovery is ongoing. Results from an ongoing seismic inversion study, aimed at recognizing reservoir ‘sweet spots’, will be incorporated when available. In addition, the prospect inventory was updated and several prospects have been high graded for drilling.

Harvest and its joint venture partner engaged a contractor to undertake a fixed-price, geophysical site survey over multiple potential well locations in the Dussafu block in August 2015. The survey is a prerequisite for siting mobile drilling units and other installations required for continuing exploration and development activities over the license. The survey will provide information about the seabed and shallow geological conditions, essential for the safe siting and operation of these installations. A tender for a jackup drilling rig was completed in November 2015 and a tender for well testing and other services was concluded in January 2016.

We are considering options to develop, sell or farm-down our interest in the Dussafu PSC to obtain the maximum value from the asset, while maintaining the required liquidity to continue our current operations

Budong-Budong, Onshore Indonesia – Discontinued Operations

We fully impaired our investment in the Budong Production Sharing Contract (“Budong PSC”) in Indonesia as of March 31, 2014. In June 2014, Harvest and its partner adopted a resolution to terminate the Budong PSC. Harvest advised the Indonesian government of this decision and submitted a request to terminate the Budong PSC. On February 5, 2015, Harvest entered into a share purchase agreement to transfer shares of Harvest Budong-Budong B.V. to Stockbridge Capital Limited for a nominal amount. On February 17, 2015, a withdrawal request of the earlier termination request was made to the Indonesian government and the withdrawal request was accepted on April 15, 2015. The transfer of shares to Stockbridge Capital Limited was completed on May 4, 2015. As we no longer have any interests in Indonesia, we reflected the results in discontinued operations in our financial statements.

Colombia – Discontinued Operations

We received notices of default from our partners in Colombia for failing to comply with certain terms of the farm-down agreements for Block VSM14 and Block VSM15, followed by notices of termination on November 27, 2013. Our partners 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, which included an accrual of $2.0 million related to this matter. On December 14, 2014, we settled all arbitration claims for a payment of $2.0 million and the arbitration was dismissed. We are in the process of closing and exiting our Colombia venture. As we no longer have any interests in Colombia, we reflected the results in discontinued operations in our financial statements.

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Drilling and Undeveloped Acreage

For acquisitions of leases, development and exploratory drilling, we spent approximately (excluding our share of capital expenditures incurred by our investment in Petrodelta) $0.9 million in 2015 ($4.4 million in 2014, $43.9 million in 2013). These numbers do not include any costs for the development of proved undeveloped reserves in 2015, 2014 or 2013.

Our net ownership interest in our investment in Petrodelta was 32% through December 15, 2013 and 20.4% thereafter. We have participated in the drilling of wells as follows:

In Gabon, following the success of an exploration well drilled in 2011 and a second in 2013 in both the pre-salt Gamba and Dentale reservoirs, a new seismic survey commenced in October 2013. We received the first high quality seismic products during the second quarter of 2014 and interpretation was completed in early 2015. The new 3D seismic data was extended 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.

Acreage

The following table summarizes the developed and undeveloped acreage that we own, lease or hold under concession as of December 31, 2015:

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Regulation

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:

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.

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 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 natural 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, 2015, we employed 27 full-time employees. We augment our employees from time to time with independent consultants, as required.

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Properties

We have a regional office in Caracas, Venezuela that provides oversight of our investment in Petrodelta. Our corporate headquarters are in Houston, Texas. At December 31, 2015, we had the following lease commitments for office space:

Legal Proceedings

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); 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 we 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 John Phillips v. Harvest Natural Resources, Inc., James A. Edmiston and Stephen C. Haynes (March 22, 2013). We and the other named defendants have filed a motion to dismiss and intend to vigorously defend the consolidated lawsuits. We are currently unable to estimate the amount or range of any possible loss.

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. We are currently unable to estimate the amount or range of any possible loss.

On February 27, 2015, Harvest US and Branta Exploration & Production Company, LLC filed a complaint against Newfield in the United States District Court for the District of Colorado. The plaintiffs previously sold oil and natural gas assets located in Utah’s Uinta Basin to Newfield pursuant to two Purchase and Sale Agreements, each dated March 21, 2011. In the complaint, the plaintiffs allege that, prior to the sale, Newfield breached separate confidentiality agreements with Harvest US and Branta by discussing the auction of the assets with a potential bidder for the assets, which caused the potential bidder not to participate in the auction and resulted in a depressed sales price for the assets. The complaint seeks damages and fees for breach of contract, violation of the Colorado Antitrust Act, violation of the Sherman Antitrust Act and tortious interference with a prospective business advantage. In September 2015, plaintiffs amended their complaint to add Ute Energy, LLC and Crescent Point Energy Corporation as defendants. Subsequently, Plaintiffs agreed to dismiss with prejudice all claims against Ute Energy, LLC and Crescent Point Energy Corporation.

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% interest) intending to pay

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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. On April 23, 2014, we received a notice that OFAC had denied our October 26, 2011 application for the return of the blocked funds. During the year ended December 31, 2015, primarily due to the passage of time, we recorded a $0.7 million allowance for doubtful accounts to general and administrative costs associated with the blocked payment and a $0.4 million receivable from our joint venture partner. On October 13, 2015, we filed a request that OFAC reconsider its decision and on March 8, 2016, OFAC denied our October 13, 2015 request for the return of blocked funds; however, we will continue attempts to recover the funds from OFAC.

Harvest Vinccler, a subsidiary of Harvest Holding, 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:

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. The Uracoa tax assessments would be transferred upon the closing of the proposed sale of our Venezuelan assets.

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:

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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 January 15, 2015, HNR Finance and Harvest Vinccler S.C.A submitted a Request for Arbitration against the Government of Venezuela before the International Centre for Settlement of Investment Disputes (“ICSID”) regarding HNR Finance’s interest in Petrodelta. The Request for Arbitration set forth numerous claims, including (a) the failure of the Government of Venezuela to approve our negotiated sale of its 51% interest in Harvest Holding to Petroandina on any reasonable grounds in 2013-2014, resulting in the termination of the SPA (b) the failure of the Government of Venezuela to approve Harvest’s previously negotiated sale of its interest in Petrodelta to PT Pertamina (Persero) on any reasonable grounds in 2012-2013, resulting in the termination of a purchase agreement entered into between HNR Energia and PT Pertamina (Persero); (c) the failure of the Government of Venezuela to allow Petrodelta to pay approved and declared dividends for 2009; (d) the failure of the Government of Venezuela to allow Petrodelta to approve and declare dividends since 2010, in violation of Petrodelta’s bylaws and despite Petrodelta’s positive financial results between 2010 and 2013; (e) the denial of Petrodelta’s right to fully explore the reserves within its designated areas; (f) the failure of the Government of Venezuela to pay Petrodelta for all hydrocarbons sales since Petrodelta’s incorporation, recording them instead as an ongoing balance in the accounts of PDVSA, the Government of Venezuela-owned oil company that controls Venezuela’s 60% interest in Petrodelta, and as a result disregarding Petrodelta’s managerial and financial autonomy; (g) the failure of the Government of Venezuela to pay Petrodelta in US dollars for the hydrocarbons sold to PDVSA, as required under the mixed company contract; (h) interference with Petrodelta’s operations, including PDVSA’s insistence that PDVSA and its affiliates act as a supplier of materials and equipment and provider of services to Petrodelta; (i) interference with Petrodelta’s financial management, including the use of low exchange rates Bolivars/US dollars to the detriment of Harvest and to the benefit of the Government of Venezuela, PDVSA and its affiliates; and (j) the forced migration of our investment in Venezuela from an operating services agreement to a mixed company structure in 2007.

On January 26, 2015, Petroandina filed a complaint for breach of contract against Harvest and its subsidiary HNR Energia in Court of Chancery of the State of Delaware. The complaint states that HNR Energia breached provisions of the Shareholders’ Agreement between Petroandina and HNR Energia, which provisions require HNR Energia to provide advance notice of, and deposit $5.0 million into an escrow account, before bringing any claim against the Government of Venezuela. Under those provisions, if Petroandina so requests, an appraisal of Petroandina’s 29% interest in Harvest Holding must be performed, and Petroandina has the right to require HNR Energia to purchase that 29% interest at the appraised value. Petroandina’s claim requests that, among other things, the court (a) declare that HNR Energia has breached the Shareholders’ Agreement by submitting the Request for Arbitration against the Government of Venezuela on January 15, 2015 (which Request for

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Arbitration was subsequently withdrawn without prejudice); (b) declare that we have breached its guaranty of HNR Energia’s obligations under the Shareholders’ Agreement; (c) direct Harvest and HNR Energia to refrain from prosecuting any legal proceeding against the Government of Venezuela (including the previously filed Request for Arbitration) until such time as they have complied with the relevant provisions of the Shareholders’ Agreement; (d) award Petroandina costs and fees related to the lawsuit; and (e) award Petroandina such other relief as the court deems just and proper. On January 28, 2015, the Court of Chancery issued an injunction ordering Harvest and HNR Energia to withdraw the Request for Arbitration and not take any action to pursue its claims against Venezuela until Harvest and HNR Energia have complied with the provisions of the Shareholders’ Agreement or otherwise reached an agreement with Petroandina. Accordingly, on January 28, 2015, HNR Finance B.V. and Harvest Vinccler S.C.A. withdrew without prejudice the Request for Arbitration. In the Delaware proceeding, Harvest and HNR Energia have until August 23, 2016 to respond to Petroandina’s complaint. We are currently unable to estimate the amount or range of any possible loss.

On July 12, 2016, Petroandina amended its January 26, 2015 breach of contract petition to state a second claim in the Court of Chancery. For information about the July 12, 2016 claim, see Background of the Proposed Sale beginning on page 14.

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

Risk Factors

We face significant risks in holding a minority investment in Petrodelta. These risks and other risk factors are discussed in our Annual Report on Form 10-K filed with the SEC on March 27, 2016, under the heading Item 1A. Risk Factors.

Financial Statements, Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following audited consolidated financial statements of Harvest Natural Resources, Inc. and its subsidiaries, along with the related Management’s Discussion and Analysis of Financial Condition and Results of Operations and related Information about Oil and Gas Producing Activities, are attached to this proxy statement as Appendix C. This information is excerpted from our Annual Report on Form 10-K for the year ended December 31, 2015.

The following unaudited consolidated financial statements of Harvest Natural Resources, Inc. and its subsidiaries, along with the related Management’s Discussion and Analysis of Financial Condition and Results of Operations, are attached to this proxy statement as Appendix D. This information is excerpted from our Quarterly Report on Form 10-Q for the quarter ended March 31, 2016.

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The following unaudited consolidated financial statements of Harvest Holding and its subsidiaries are attached to this proxy statement as Appendix E.

The following audited financial statements of Petrodelta for the years ended December 31, 2014, 2013 and 2012 are attached to this proxy statement as Appendix F. This information is excerpted from the Amendment No. 2 on Form 10-K/A, filed with the SEC on June 26, 2015, to our Annual Report on Form 10-K for the year ended December 31, 2014.

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Selected Consolidated Financial Data

Harvest 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, 2015.

Selected quarterly financial data for each of the quarters in each of the years ended December 31, 2015 and 2014 appears in the financial information included in Appendix C attached to this proxy statement.

Pro Forma Selected Consolidated Financial Data

The following tables set forth our selected pro forma equivalent per share data for the three months ended March 31, 2016 and the years ended December 31, 2015 and 2014 and our selected pro forma balance sheet data as of March 31, 2016. Pro forma balance sheet data was derived from, and presented in conformity with, the unaudited pro forma consolidated balance sheet as of March 31, 2016.

The data in the tables is unaudited. The pro forma information is presented for illustrative purposes only and is not necessarily indicative of future operating results or the financial position of Harvest. This data should be

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read in conjunction with Harvest’s historical consolidated financial statements and related notes contained within this proxy statement.

Harvest’s pro forma book value per share was calculated by dividing total pro forma stockholders’ equity by pro forma total common shares outstanding as of March 31, 2016. Pro forma total common shares outstanding as of March 31, 2016 includes two adjustments from the total common shares outstanding reported in Harvest’s historical consolidated balance sheet as of March 31, 2016. The first is an additional 1.6 million shares due to the accelerated vesting of certain restricted stock units to be settled in shares and the second is a reduction of 8.7 million shares due to the surrender of shares owned by CT Energy. Both of these adjustments assume the transaction with CT Energy occurred on March 31, 2016.

Unaudited Pro Forma Consolidated Financial Statements of Harvest Natural Resources, Inc.

Introduction

On June 29, 2016, Harvest and its wholly owned subsidiary, HNR Energia entered into the Share Purchase Agreement with CT Energy to sell all of Harvest’s interest in Venezuela. Under the terms of the Share Purchase Agreement, CT Energy will acquire 51.0% of the outstanding shares of Harvest Holding. In exchange, CT Energy will pay Harvest $80.0 million at closing of the Transaction and an additional $12.0 million upon the maturity of a six-month 11.0% note payable by CT Energy. Principal of $30.0 million on Harvest’s 15.0% senior secured note due 2020 will be cancelled at closing. All remaining outstanding debt and accrued interest due to CT Energy in excess of the $30.0 million cancelled at closing will be paid by Harvest by means of a dollar-for-dollar reduction of the $80.0 million cash portion of the purchase price. In addition, the 8.67 million shares of Harvest common stock, $0.01 par value per share, held by CT Energy will be surrendered at closing, and CT Energy’s warrant to purchase 34.07 million shares of Harvest common stock will be cancelled at closing.

After giving effect to the transaction, Harvest would cease to have a presence in Venezuela, and the existing relationship between Harvest and CT Energy, which currently owns 16.8% of Harvest’s outstanding shares of common stock, would terminate. In addition, at the closing, the two CT Energy non-independent directors

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appointed in connection with CT Energy’s initial investment in Harvest would resign from the Board. Going forward, Harvest’s primary assets would be its oil and gas interests in Gabon and cash.

Harvest’s Board unanimously approved the Share Purchase Agreement. Closing of the transaction is subject to approval by stockholders representing a majority of outstanding shares of Harvest common stock, a majority of outstanding shares held by stockholders not affiliated with CT Energy, and the Government of the Bolivarian Republic of Venezuela.

The following unaudited pro forma consolidated balance sheet as of March 31, 2016 and the consolidated statements of operations for the three months ended March 31, 2016 and the years ended December 31, 2015 and 2014 have been derived from our historical financial statements. The pro forma adjustments have been prepared as if the transaction had taken place on March 31, 2016, in the case of the pro forma consolidated balance sheet and on January 1, 2015, in the case of the pro forma consolidated statements of operations for the three months ended March 31, 2016 and for the year ended December 31, 2015. The pro forma consolidated statement of operations for the year ended December 31, 2014 reflects the elimination of the operations of Harvest Holding from continuing operations as those amounts will be reflected as discontinued operations upon closing of the transaction.

The unaudited pro forma consolidated balance sheet as of March 31, 2016, also reflects the related pro forma tax impact of the sale. As discussed further in the notes to the pro forma financial information, Harvest is expected to realize a gain for United States (“U.S.”) income tax purposes upon closing of the sale although not all of that gain may be currently recognized due to exceptions under U.S. tax rules. As a result of the sale and as reflected in the pro forma consolidated balance sheet, we expect that the most likely tax impact for financial reporting purposes will be the recording of an U.S. deferred tax liability on the gain on sale realized for income tax purposes but currently deferred from U.S. taxation.

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. Prior to 2013, no U.S. taxes had been recorded on the unremitted earnings of our non-U.S. subsidiaries as it was our practice and intention to reinvest the earnings of those non-U.S. subsidiaries into our foreign operations.

During the fourth quarter of 2013 and in subsequent periods, management evaluated numerous factors related to the timing and amounts of possible future distributions of foreign earnings to the parent company, with consideration of the sale of non-U.S. assets including the sale of the then-29.0% equity interest in Harvest Holding. Because management was pursuing various alternatives with respect to Harvest’s future operations and disposition of any sale proceeds, a determination was made that it was appropriate to record a deferred tax liability associated with the unremitted earnings of our foreign subsidiaries. However, due primarily to impairments of Harvest’s investment in our Venezuelan cost investment, Petrodelta, during the years ended December 31, 2015 and 2014, the deferred tax liability associated with the unremitted foreign earnings was reduced to zero as of December 31, 2015.

Management also assessed the available positive and negative evidence related to its U.S. net operating losses, alternative minimum tax credit carryforwards, and other U.S. deferred tax assets to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. After reviewing the terms of the sale of Harvest Holding and the possible future operations of Harvest, management has determined that we may not have sufficient taxable income in the U.S. from the sale of Harvest Holding nor from ongoing operations in the years following the closing of the sale to use the deferred tax assets. The unaudited pro forma consolidated statements of operations for the periods presented therefore reflect the continued imposition of a valuation allowance on the U.S. tax attributes.

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For pro forma purposes, funds received from debt, warrant and equity issuances with CT Energia would no longer have been required as proceeds from the sale of the 51.0% equity interest in Harvest Holding on January 1, 2015 and would have been adequate to fund operations and capital requirements during the pro forma periods from January 1, 2015 through March 31, 2016. Therefore in these unaudited pro forma consolidated financial statements, we have reflected pro forma adjustments related to the impact of the sale of the equity interest in Harvest Holding on the debt and equity instruments that were outstanding during the periods January 1, 2015 through March 31, 2016 presented in the unaudited pro forma consolidated financial statements. The pro forma consolidated statement of operations for the year ended December 31, 2014 reflects the elimination of the operations of Harvest Holding from continuing operations as those amounts will be reflected as discontinued operations upon closing of the transaction.

The preparation of the unaudited pro forma consolidated financial information is based on financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The pro forma adjustments reflected in the accompanying unaudited pro forma consolidated financial information reflect estimates and assumptions that our management believes to be directly attributable to the transaction and factually supportable. Actual results may differ from those estimates.

The unaudited pro forma consolidated financial information is provided for illustrative purposes only and does not purport to represent what the actual results of operations would have been had the transaction occurred on the respective dates assumed, nor is it necessarily indicative of our future operating results. The unaudited pro forma consolidated financial information and the accompanying unaudited notes should be read in conjunction with our consolidated financial statements and related notes and Harvest Holding’s unaudited consolidated financial statements and related notes thereto included elsewhere in this proxy statement.

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Harvest Natural Resources, Inc.

Unaudited Pro Forma Consolidated Balance Sheet

As of March 31, 2016

(in thousands)