Thought I do agree that I am a little surprised by the selling into the strength and the relatively low volume, I am reminded of what it took to get here.
As stated in a previous post, IMHO, if you were to ask Zion Management, they would tell you that it is a miracle that they were able to get to the point where they actually began to drill. Israel made them jump through numerous hoops, including a very deep and specific geological scientific study of where they planned to drill, and then they were required to submit it to an independent third party to review and verify their findings. All this had to happen in order to get permission to drill.
When they did begin to drill, they clearly stated that they did not have the funds to drill to the proposed depth, but were moving on faith that God would provide. The DSPP did that. Zion has made it clear that they have been abundantly blessed with financial support. Again, IMHO, if you were to ask Zion Management, this would be miracle two.
With all this said, all risk that can be removed has been removed. Now it's all on the Geological Scientific data and most of all ... There is oil or there isn't. It all comes down to this last point.
The strong short position is clearly thinking that they will not find oil where they are drilling. The strong long position clearly thinks there is oil where they are drilling.
This is all that is left now. Is there oil or not? All other questions, and concerns have been addressed.
I will say that when Victor Carillo states how very happy they are with the results of the drilling so far, there is the assumption that he is also referring to the constant review of the mud and rock that is expelled during the drilling process. As with all drilling operations, they are constantly reviewing what comes up from the deep to see if there are any signs of hydro carbons.
This is an ongoing process at any drill site:
Rock and fluid properties will determine how much oil and natural gas can be recovered from a reservoir. After an exploratory well has been drilled, it is evaluated to determine if there is enough oil and natural gas in the reservoir to make it economically feasible to initiate recovery operations.
Drill Cuttings and Core Samples - As the drilling mud is brought to the surface, it is run through a sieve to removed the drill cuttings (pulverized rock) before the mud is recycled down into the well. Small pieces of rock are selected for microscopic analysis to determine the type of rock being drilled, how porous it is, and whether oil is present. The drilling mud also is analyzed with sensors to see if trace amounts of oil or natural gas are present — an indication of a possible accumulation at depth. In the past, rock cuttings were the principal source of well information.
Well Logging - A special bit can be used to cut a cylindrical piece of rock that can be brought to the surface for analysis. The core is sent to a laboratory where the exact porosity and permeability can be determined. This gives a good indication of how well oil or natural gas would flow through the rock. Fluid samples can be taken and analyzed to determine the amount and type of hydrocarbon present in the rock.
With this in mind, they must have some idea (25%) of what they are drilling towards with respect to the success of the well.
AI
