Harvest Natural Resources Sued Over South China Sea Zone

Harvest Natural Resources Inc. was sued by dozens of Taiwan residents seeking to stop the company from developing plans to search for petroleum and natural gas in an area of the South China Sea.

The company found more than 500 million barrels of oil and 7.5 trillion cubic feet of natural gas in an area of the sea that is partially located in the economic zone of the Sinnan Islands, “whose natural and economic resources belong to the people of Taiwan,” according to the complaint filed yesterday in U.S. District Court in Houston.

Harvest in December 1996 acquired Crestone Energy Corp., which had a petroleum contract with China’s state-owned China National Offshore Oil Corp. that permits it to explore in an area of the South China Sea known as WAB-21, according to the suit. The residents are seeking $2.9 million in damages.

“Plaintiffs allege that defendant will continue its exploration in the WAB-21 area in the South China Sea pursuant to the contract and at some point in time extract the oil and natural gas reserves it found, thereby depriving plaintiffs of the natural resources owned by plaintiffs,” according to the complaint.

The company, based in Houston, “has no legal right to trespass on plaintiffs’ property” despite its contract with China National Offshore Oil, which also “has no ownership right” over the property, the residents said in the suit. China National Offshore Oil wasn’t named as a defendant in the complaint.

A telephone message left for Stephen C. Haynes, chief financial officer of Harvest Natural Resources, seeking comment on the suit wasn’t immediately returned.

The case is Sone v. Harvest Natural Resources Inc., 4:13-cv-02161, U.S. District Court, Southern District of Texas (Houston.)

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