Haha AWESOME!

If they are fracking that would be very good if the existing formation is tight with no natural fractures and porosity is sub par. We’re only speculating thus far though. I’ll send you a pic if you can post it Tim.

Carrot top? Lol

???? ????

Thank you tisdal. Blessings for all your labors.

In full agreement there. Full agreement.

Well done and great questions. Excellent questions actually. I’m afraid many won’t be answered. I do hope they are forthright and give ample time for the Q@A session.

Lol!


Porkie,

Serious question. Were you formally very bullish before MJ01, during MJ01, or just after it was deemed a plug and abandonment? Serious question, seriously.

Gotcha. Thnx KyOil. I was staring at another document the other day as a pdf file whihc you probably have seen before. The new website has a nice update (not so great for me who only uses an Iphone).

We would love to know too. The license/lease page at the Ministry’s website hasn’t been updated since 9/2021. Maybe they only update it once a year?

It is, albeit a strange dichotomy. On one hand it does reduce price discovery but on the other we would definitely not have an MJ02. If I had the choice I would have to say MJ02 was/is more important.

“Quotes”

“I could ask how's that Active Petroleum System working out for you, but instead, let me just ask, how profitable was the MJ#1s hydrocarbon shows?”

This is working out fine for me. An active petroleum system contains all the ingredients for hydrocarbon production. They found it based on MJ01 and it’s absolutely appropriate to drill another well based on the data to find the source of the trap and reservoir rocks.

“No amount of pumping is going to put one ounce of oil at the MJ#2 wellhead. If it's not there, it's not there. And as they said in their March 31st quarterly/annual report, "Currently, the Company has no economically recoverable reserves and no amortization base.". So, it's not there. A least, as of last month (April), it wasn't there.”

Please refrain from making insults and false claims. Industry practice deems a continuous phase show of hydrocarbons as the only reason to complete a well. MJ02 is completed. That speaks enough to what they found. They are not legally bound to say they have a commercial reservoir when they haven’t received confirmation as of yet from Israeli Authorities. That would be against the Petroleum Law of 1952 and Guidelines for Approval of a Commercial Discovery making is in turn, illegal.

“Are they lying? And if they lied, don't you think those who sold based on their end of March 31, 2022 statement, will sue?”

It’s a OTC company with Forward Looking Statements. It’s best to read those. No, I also don’t think sellers will sue based on selling off the 10K. Maybe they will try? The derivative lawsuit was a failure and I expect one based on speculative selling to suffer the same fate. I don’t think management is lying as that would be illegal, right? We addressed the EROI in the above paragraph.

“A great story has been woven together here, but the story is just that, a story. The annual meeting will come and go, no gas, no oil, but the spin, yup, the spin. I look forward to the spin you guys will surely give them.”

All stocks are “stories”. Some play out better than others. Speculatory statements like above of no gas, no oil, and spin are just that: bearish speculation. All the data and research thus far is very bullish to me. Still, we have to wait and see what the answers are to the questions that remain.

We need to hear more of this someday jarhead167. Thanks for joining the forums to give your take.

So there is some other info in the regs concerning getting a lease in the license area at expiration and the license being preferrable to the existing petroleum rights? At this stage the license is expiring at the point of term fulfillment. You’re probably right that a working relationship with critical path does last longer.

Wrt Zion losing the license once a lease is applied for.

“GRANT OF LEASE 26 (Amendment 1965)

ARTICLE FOUR: LEASES
Subject to the provisions of this Law, a lease confers upon the lessee the exclusive right to explore for and produce petroleum in the area of the lease so long as the lease is in force.
A licencee, who has made a discovery in the licenced area and has during the period of the licence made an application therefor in accordance with this Law and the regulations, is entitled, subject to the conditions of the licence and of section 27, to be granted by the Commissioner a lease in respect of any area chosen by him within the licenced area. The lease shall be subject to the conditions stipulated in the licence and upon the grant thereof the licence shall expire and the State shall be regarded as the lessee of the remainder of the area.
(a) The State may, on such conditions as it may think fit, transfer to another person lease rights vested in it under section 26.


15A (a)
Where the company referred to in section 80A has carried out preliminary investigations on any land in respect of which no priority right or petroleum right exists, with a view to ascertaining the prospects for discovering petroleum thereon, and after publication of the results of the investigations more than one licence is sought in respect of that land, the Minister may, after consultation with the Authority, notify in Reshumot that that land will be available for competitive bidding, and so long as the notice is in force no priority right or petroleum right shall be granted in respect of that land save by competitive bidding.

(d) There shall be no obligation to accept the highest or any bid.”

So if Zion applies for a lease but not the new license they could be saddled with competitive bidding. Can you imagine if they confirmed a discovery how many suitors would desire that license area?

Nice post. Great minds think alike as I posted the same idea at 2:30 pm today on ST about a bidding war. Glad we are all on the same page.

Great research Moses. Thanks for digging into this matter.

Price action of literally thousands of stocks that explore for resources have gone from $’s to pennies. Many have disappeared entirely. That being said, the price action of ZNOG while having a hardcore drop since around ‘08 doesn’t really matter with what has been unveiled regarding the process of the Megiddo-Jezreel license. We are at a crossroads of sorts where this stock trading at pennies could explode to x’s with results to be revealed very soon. Loads of data has been given here and elsewhere that should give the bearish viewpoint some reconsideration.

Thanks for the analysis JRyan.

Any speculation as to why?

Key point from study:

“If a hydrocarbon show can be identified as continuous phase oil or gas, the second step is to assess whether the observed hydrocarbons can be produced to the borehole at economic rates and quantities. Well bores are evaluated as to economic producibility by logs, formation tests, cores, and sample examination. If a show is interpreted to be economically productive, casing is run and a completion is attempted.”

PR 5/11/2022

“Zion’s MJ-02 well has been completed through casing, liner, and cementing.”

Press Release from Zion Oil&Gas 3/11/2022 on newswire and company website.

Zion Oil & Gas, a public company, traded on OTCQX Best Market, explores for oil and gas onshore in Israel on their 99,000-acre Megiddo exploration license area.

“The Lord Himself goes before you and will be with you; He will never leave you nor forsake you. Do not be afraid; do not be discouraged.”
Deuteronomy 31:8
“Sing to the Lord, for He has done glorious things; let this be known to all the world. Shout aloud and sing for joy, people of Zion, for great is the Holy One of Israel among you.”
Isaiah 12:5-6

Tisdal, you missed my post 48666 and 48667 ;)

Production is a “lease”.

Exploration is a “license”.

As we also discussed and in KyOil’s post below in the last week it was clearly stated that the production “lease” if granted causes the Petroleum right holder to lose their license automatically as it converts. This is why ZNOG is simultaneously applying for a “new” Megiddo license so that they will have secured a production lease (if MJ02 is commercial) and also preserve the 99k acre Megiddo-Jezreel area as a new “4**” license with which to perform more exploration with more wells.

We’ve discussed this already.

That time stamp is concerning “if” a commercial discovery is made. It’s a hypothetical. “If” it was found after the June ASM and before trouble with the drill bits then definitely by December a lease would have been automatic with the proper application.

Also if you notice concerning a lease he said, “There is a 30, a 50, a 3…” 50:10

They just announced a 3 year term approval for #428 pretty much proving that they made a discovery that needs that extra time to “define a petroleum field”. This is taken directly from the regs. Is it commercial? We don’t know yet.

Do you mean MJ02? You said MJ01….

Okay, I’ll ask about hydrocarbon shows and you can ask about the bi-weekly updates. Deal?

Right on tisdal. That is a most excellent question.

I mean this was just in anticipation of expiring warrants as they’ve done multiple times. I don’t think they are finished with the DST and interpretation just yet. Imho.

I would more than love to get an operational update before the ASM. A PR with commercial oil would be even more stellar. Based on the timelines of testing I think we are very close but being mid May we still a bit away from anything concrete.

I mean, it’s only an 8K for warrant extensions. Very mundane.

It won’t harm any fossil fuel companies because for the foreseeable future beyond maybe my lifetime the amount of hydrocarbon production and sales will have to skyrocket to realize any kind of renewable energy push. Even the Ministry can’t hide from that fact and publicly they’ve stated this numerous times.

Such an intriguing outcome to arrive soon!

Could it be that the nitrogen flush in Q4 was to clean the bore for a recheck of formation pressure recovery and to confirm mud weights were correct in not putting undue pressure on the formation?

It’s an eye opening journal study with evidence from BP Shell.

It’s still not clear to me whether oil or gas but I lean towards oil. If they are seeing this filament as sourced from a downdip reservoir they could variably have touched an economic reserve of oil and gas. How good would that be? I can tell this has piqued your interest.

"Study hard and all things can be accomplished. Give up, and you will amount to nothing." - Yamaoka Tesshu

As KyOil will tell you oil patch speak is like a mystery wrapped in an enigma.

After studying hydrocarbon shows I found the only type of show that necessitates a well completion and production testing is a type 1 continuous phase show which is a “filament” of oil or gas extending from a hydrocarbon reservoir. The idea is that during mud logging and wireline logs Zion observed a continuous showing and based on that data the contractors said to “complete” the well with a liner system. There are 3 other types of hydrocarbon shows that do not require nor do they even encourage completion of a well. Hence, MJ01 was not completed with production testing.

Also, the idea that the shows are a “fart” in the hole or a kerogen deposit are absolutely false.

“Hydrocarbons occur in the subsurface in four modes: (1) continuous phase oil or gas, (2) isolated droplets of oil or gas, (3) dissolved hydrocarbons, and (4) associated with kerogenous rocks. All of these modes of occurrence can result in what is described as a subsurface hydrocarbon "show." Each show type has markedly different implications to exploration and must be differentiated as the first step in show interpretation. Only continuous phase occurrences of oil and gas indicate that a trapped and potentially producible accumulation of hydrocarbons has been discovered. Free oil or gas recovery from the formation or subsurface hydrocarbon saturations of greater than 55% indicates a continuous phase occurrence.”
For your reading pleasure and entrance down this rabbit hole:

https://www.searchanddiscovery.com/documents/97017/article.htm

They could very well have missed the economic reservoir on MJ01. With the fault lines being a prominent structure in the valley a stratigraphic trap is likely and if so they may have tapped into a “transition zone” of oil and water. While going deeper they found almost 100% high and low chloride brine. Very common with this type of trap. Above the water zone is the pay zone but maybe dipping further east. The acid stimulation was “small” on MJ01 so I don’t think they were able to tap into the economical zone. Cutting the fault with the wellbore can prove this and indeed they did say many questions posed in the 11/18 PR were answered by the 3D. All the core and rock samples, wireline, etc.

Now, being that they have such a massive data set in totality there is a very very high probability they are right on target and even though the formation rocks provided little natural fractures and low porosity at 16k feet on MJ01 we don’t know yet whether they found the Senonian aged rocks in MJ02. Any acidification done now will be substantially based on all data and I’d be remiss if they weren’t going WOT on this well to ensure the best chances of EROI.

On MJ01 they had a “little oil”. On MJ02 they found “encouraging hydrocarbon shows” of a Type 1 Continuous flow imho. If we had more information we could outline more details but alas, we can only speculate with what little clues we’ve gleaned.

Suffice it to say, every little nugget of truth from hydrocarbons shows to completion liners and license extensions based on Reg.18(b)(2) tells me they have a discovery most definitely.

From PR:

“The new exploration license filing will further the current and future work plans in Israel. Simultaneously with the new exploration license filing, Zion has submitted a petition seeking administrative approval of a term of three-years for the #428 exploration license under Israel’s petroleum law.”

From Pet. Law referenced above:

“Where the licencee has made a discovery in the licenced area, the
Commissioner shall extend the term of the licence for such time as will give the licencee a sufficient period, not exceeding two years, within which to define the petroleum field.”

Good stuff Alan.

I really appreciate hard work like this.

Sorry the date estimates are backwards on this post. Switch ‘em for each paragraph.

High possibility. Asking for the full 3 year term for #428 proves they are sure they made a discovery and they have until 2023 to define the petroleum field. (Reg.18(b)(2))

Based on the guidelines they have alot of work to do to submit the data required for the commercial discovery to be approved. If they are sure they had very good natural flow at the mud logging stage they could make an application without the necessary data from the guidelines and submit what data they got from that early testing stage and wait for the back and forth from Yossi to finally announce the commercial discovery. This could take a few more months.

If they need to finish the DST with perforation and enhancement then they would gather the data required of the guidelines for a petroleum discovery and submit the major 4 items. When submitted they would wait no more than 60 days to confirm a commercial discovery if it truly is based on data. This could happen at any time if they submitted an application back in Q4 2021-Q1 2022.

Correct, unless Zion chooses to keep it so under reg 22,22,37, and 50 of the Petroleum Law regulations.

Surprisingly there was, as amended in 1965, a certain State owned and Development Ministry owned “Petroleum Basic Research Company” under reg 80 that also kept that information under secrecy. To wit, that is still in the law and who this entity is now, none know.

Lol


Thanks for the breakdown brother. I appreciate it.

Let’s continue to consider our next best usage of our time after we make bank.