Harvest updates Indonesian operation

The following is an excerpt taken from Houston-based firm Harvest Natural Resources, Inc?s quarterly report, released on Wednesday. (ed)

Budong-Budong PSC - onshore West Sulawesi (Harvest 64.4%)
The Lariang-1 (LG-1) well spud on January 6, 2011, and was the first of two planned exploration wells located in the Budong-Budong Block, onshore West Sulawesi. The well was drilled to a depth of 5,311 feet and encountered multiple oil and gas shows within the secondary Miocene objective. Wireline logs and samples of reservoir fluids confirmed the presence of hydrocarbons, trap and seal thus greatly de-risking the exploration potential of the license. The high formation pressures and control difficulties required the use of more casing strings at shallower depths than were originally planned. At a depth of 5,300 feet, losses of heavy drilling mud into the formation were encountered which, when coupled with the very high formation pressures, led to the decision to discontinue operations and plug and abandon the well for safety reasons on April 8, 2011. The primary Eocene targets had not yet been reached, as the well was planned for a total measured depth of approximately 7,200 feet.

The KD-1 well spud on June 20, 2011 and is the second of two planned exploration wells located in the Budong-Budong Block, onshore West Sulawesi. The KD-1 well will be drilled to test a thrusted surface anticline with stacked Miocene and Eocene targets to a planned total measured depth of approximately 10,800 feet.

After setting 13 3/8" casing at 3,227 feet on July 21, 2011, the rig substructure and derrick were temporarily moved to remediate settling on the drilling pad. Drilling is expected to recommence on August 11, 2011.

Harvest owns a 64.4 percent non-operated working interest in the Budong-Budong Block PSC. (end of excerpt)