HARVEST NATURAL RESOURCES Stock Option Agreement

Exhibit 10.2

HARVEST NATURAL RESOURCES

Stock Option Agreement

          Agreement (this “Agreement”) made at Houston, Texas, USA, as of May 7, 2007, by and between HARVEST NATURAL RESOURCES, INC. (the “Company”) and Keith L. Head (the “Optionee”).

     1.  Definitions:

	(a)		“BOARD” OR “BOARD OF DIRECTORS” shall mean the Board of Directors of the Company.
	(b)		“CODE” shall mean the Internal Revenue Code of 1986, as amended from time to time.
	(c)		“COMMITTEE” shall mean the Human Resources Committee of the Board of Directors, or, if there is no Human Resources Committee, the committee designated by the non-employee members of the Board of Directors to administer the Company’s long-term incentive plans.
	(d)		“FAIR MARKET VALUE” of Stock shall mean the average of the highest price and the lowest price at which Stock shall have been sold on the applicable date as reported by the New York Stock Exchange Composite Transactions. In the event that the applicable date is a date on which there were no such sales of Stock, the Fair Market Value of Stock on such date shall be the mean of the average of the highest price and the lowest price at which Stock shall have been sold on the last trading day preceding such date.
	(e)		“STOCK” shall mean the common stock of the Company.
	(f)		“SUBSIDIARY” shall mean any corporation or similar legal entity (other than the Company) in which the Company or a Subsidiary of the Company owns fifty percent (50%) or more of the total combined voting power of all classes of stock, or such lesser amount of ownership determined by the Committee.
	(g)		“TOTAL DISABILITY” and “TOTALLY DISABLED” shall normally have such meaning as that defined under the Company’s group insurance plan covering total disability and determinations of Total Disability normally shall be made by the insurance company providing such coverage on the date on which the Employee, whether or not eligible for benefits under such insurance plan, becomes Totally Disabled. In the absence of such insurance plan or in the event the individual is a Director or Consultant, the Committee shall make such determination.

     It is hereby agreed as follows:

2.

Grant of Option; Consideration . The Company hereby grants to the Optionee on May 7, 2007, a nonqualified stock option to purchase up to 50,000 shares of the Company’s Common Stock, par value $0.01 per share (the “Shares”), at an exercise price of $10.065 per share (the “Option”). The Option granted hereunder is not intended to constitute an incentive stock option within the meaning of Section 422 of the Code. The terms of the Option are subject to adjustment in certain circumstances, as provided in this Agreement.

The Optionee shall be required to pay no consideration for the grant of the Option, except for his agreement to serve as an employee of the Company or any Subsidiary and other agreements set forth herein.

	3.		Vesting . Subject to all of the terms and conditions of this Agreement, including acceleration of vesting in the event of a Change of Control or Total Disability, the Optionee may purchase up to 16,667 Shares upon exercise of this Option on or after May 6, 2008, an additional 16,667 Shares upon exercise of this Option on or after May 6, 2009, and the remaining 16,666 Shares upon exercise of this Option on or after May 6, 2010.
	4.		Term and Termination of Service . This Option, to the extent it has not been previously exercised, shall expire at 5:00 p.m. (Central Time) on May 6, 2014 or, if earlier, at 5:00 p.m. (Central Time):

	(i)		on the date 3 months after the Optionee ceases to be an employee of the Company or any Subsidiary for any reason other than a Change of Control, Total Disability or death;
	(ii)		on the date 12 months after the Optionee ceases to be an employee of the Company or any Subsidiary by reason of Total Disability;
	(iii)		on the date 12 months after the date of the Optionee’s death while in the employ of the Company or a Subsidiary or within 3 months after the termination of such employment; or
	(iv)		on the date 12 months after the Optionee’s termination of employment or service if such employment or service is terminated within 730 days after the effective date of a Change of Control.

Except in the case of a termination subject to (ii) above, the Option shall be exercisable after the date of such termination of Optionee’s service or employment only to the extent the Option was exercisable at the date of such termination. In the case of termination subject to (ii) above, any Options that are not exercisable shall become exercisable effective as of Optionee’s termination date.

Notwithstanding anything to the contrary in the Agreement, if and for so long as Optionee is subject to an Employment Agreement with the Company, then the terms of the Employment Agreement will govern the early expiration of the Option including,

without limitation, vesting and expiration dates. In the event of any conflict between the Employment Agreement and this Agreement, the terms of the Employment Agreement shall govern.

	5.		Option Exercise . The Option may be exercised in whole or in part (to the extent then exercisable) by contacting the Company’s designated agent for processing Option exercises. An Option exercise must be accompanied by payment in full of the exercise price (i) in cash, (ii) through the withholding of shares of Stock (which would otherwise be delivered to the Optionee) with an aggregate Fair Market Value on the exercise date equal to the aggregate exercise price of the Option, (iii) a combination of a cash payment and such surrender of shares, (iv) by means of a broker-assisted cashless exercise to the extent then permitted under rules and regulations adopted by the Committee, or (v) in such other manner as may then be permitted under rules and regulations adopted by the Committee. As soon as practicable after the valid exercise of the Option, the Company shall deliver to the Optionee one or more stock certificates representing the Shares so purchased, with any requisite legend affixed.
	6.		Non-Transferability . No right or interest of the Optionee in the Option shall be pledged, encumbered, or hypothecated to or in favor of any third party or shall be subject to any lien, obligation, or liability of the Optionee to any third party. The Option shall not be transferable to any third party by the Optionee otherwise than (i) by will or the laws of descent and distribution, (ii) pursuant to a qualified domestic relations order as defined under the Code or Title I of the Employee Retirement Income Security Act of 1974 to an immediate family member, or (iii) to the extent authorized by the Committee, to an immediate family member of the Optionee who acquires the options from the Optionee through a gift.
	7.		Compliance with Laws and Regulations . The obligation of the Company to deliver Shares upon the exercise of this Option is conditioned upon compliance by the Optionee and by the Company with all applicable laws and regulations, including regulations of federal and state agencies. If requested by the Company, the Option