Harvest Natural Resources, Inc. has announced 2005 fourth quarter earnings of $10.5 million, or $0.27 per diluted share, compared with $15.3 million, or $0.39 per diluted share, for the same period last year. Net income for 2005 was $50.8 million or $1.32 per diluted share, compared with 2004 net income of $34.4 million, or $0.90 per diluted share.
Operating cash flow (defined as cash flows from operating activities before changes in operating assets and liabilities) was $27.8 million for the 2005 fourth quarter compared with $31.1 million for the 2004 fourth quarter. Operating cash flow was $119.1 million for 2005 compared with $86.3 million for 2004.
Proved reserves as of year-end 2005 were reduced to 36.1 million barrels of oil equivalent due to actions taken by the Venezuelan government during 2005.
Harvest President and Chief Executive Officer, James A. Edmiston, said, "Adjusted for prior asset sales, last year produced the best financials results in the Company's history, yet we faced continuing challenges in the pursuit of our Venezuelan strategy. Net income rose to $50.8 million and operating cash flow increased to $119.1 million, primarily as a result of attractive oil prices. Oil deliveries benefited from the successful drilling program that started during the second half of 2004 increasing production to 29,000 barrels of oil per day (Bopd) by January 2005. However, we were forced to suspend our development program in January 2005 due to actions taken by the Venezuelan government including the refusal of PDVSA and the Ministry of Energy and Petroleum to grant the necessary permits. Without the ability to drill new wells, oil production and deliveries declined throughout 2005 to a year-end level of 22,000 Bopd and our proved reserve estimates were negatively impacted.
2005 Production
Barrels of oil sold (thousand bbls): 8,763
MMCF of gas sold: 25,677
Average price/barrel: $24.02
Average price/mcf: $1.03
Proved Reserves (amounts in thousands)
Total Boe (net of 80 percent minority interest) Proved Reserves beginning of the year: 84,418
Revisions of previous estimates: (37,880)
Production: (10,433)
Proved Reserves end of 2005: 36,105