Zion Oil & Gas Inc (ZNOG)

[tisdal]

WebSlinger, here's the link.

Press Release: Zion Oil & Gas Confirms Active Petroleum System in Megiddo-Jezreel #1 Well In Israel

Did We Find Oil?

We encountered oil at a depth of between 16,415 ft and 16,500 ft during drilling operations, when we circulated bottoms up. The oil was separated and tested internally and externally through our mudlogging company’s chromatograph, indicating “Light Oil” based on the chemical composition of the analyzed stream.

Third party petrophysical analysis of our open hole logs continues to suggest that oil is located in this zone as well as other zones of interest.

While testing the zone between 16,415 ft and 16,500 ft, we perforated the casing and performed a small acid stimulation job. Upon circulation of the acid out of the wellbore, minor amounts of oil were observed while taking small samples of the fluid being circulated out of the wellbore.

Following the circulation of the fluid after the stimulation job, we ran back in the hole and began to swab the well to attempt to see if the well would flow. As of the writing of this update, when swabbing, the data confirms the well artificially flows at a rate of approximately 90-110 barrels of fluid per day in the zone between 16,415 and 16,500 ft. We are still swabbing completion fluid as of this writing and the results of the well are inconclusive at this point as to whether the well will establish natural flow and what the volumetric contribution of oil and water will be.

We remain hopeful but do not yet know if there is producible oil in commercial quantities within our deep primary zones, and there are still many questions yet to be answered.

However, we can say with reasonable confidence that the formation is tight with low permeability and has few natural fractures.

This is not uncommon, and often times requires advanced stimulation techniques to help determine the well’s commercial potential.