Zion Oil & Gas Inc (ZNOG)

[JRyan]

Ok great day today for a few reasons. First we were green. I pulled up a level 2 and was watching and saw the 200 shares sell to drop the price. I waited and watched as the market was closing. So I said the heck with it, put in a buy for 1000 shares at 0.25. Immediately executed as expected but I got them for 0.244. Immediately afterwards, large amounts sold to bring the price up. I do not have the powder to cause a change but what I saw did happen. I actually took the share price down!

Since I am limited I will cut and paste some thoughts from today's discussions..

Hence I support Zion building the field out and keeping control; not selling 50% to a partner like Chevron.

I 100% agree with this, at least for now. If the big boys come in, then they should have to pay, and pay dearly. The whale(s) should have a say in this.

Of note, Russia holds the record with their Kola Superdeep Borehole SG-3 deep well (trying to prove out the Abiotic Oil Theory imo). In terms of depth below the surface, the Kola Superdeep Borehole SG-3 retains the world record at 12,262 meters (40,230 ft) reached in 1989 and is still the deepest artificial point on Earth. (they didn't find anything of real value and temps became too hot to continue)

The famous hole into Hell! Voices and screams etc. It was bogus but it was and is one deep hole. I bet you those guys have great packers! Talking about drilling with spaghetti noodles!

They said the dinosaur theory is accepted by the masses but serious petroleum people know and will admit privately that there seems to be much more to the story. They said they believed oil is continuously generated deep in the earth by unknown processes. When they said this I felt as if they were letting me in on a big secret. It made an impression on me.

I as well, my dad knew and told me then, the world will not run out of oil. He was in the industry. I promised him I would not work in it and have kept my word.

Just like we are discussing the other successful wells in the middle east. How much fun would that be to go back and forth discussing how successful Zion's wells are and where all the oil is coming from smile

Let's hope, it could be just as well we are sitting at 0.03 and wondering what happened. I doubt it but it is a possibility.

Without the water drive that Aramco is now using in Ghawar, the original recoverable oil was probably 15% of the OOIP (using primary recovery). The recoverable oil is now expected to be 50% of OOIP (using secondary recovery). So, the "reservoir" of interest (recoverable oil) could have increased by 3x simply with the use of a "secondary recovery" method, i.e. water drive.

This is interesting and makes sense with them trying to go public, the gravy train is ending and soon. It would apply to any company's original estimates

The production rates at Ghawar are declining, which is evidence against abiotic recharging of the reservoir. With abiotic, the oil in place will be replenished and the production rate should be steady, or in the best case actually rise with time

I might not agree with this. I will try and find the information on abiotic oil from Pennsylvania. I think it is about the rate of replenishment, whatever the source is.

In the article they mention encountering a 350 meter deep formation (10x the reservoir depth found in Saudi Arabia). How would this discovery not be financially viable for them to re-visit now given current prices? I'm curious if their lease has expired. Anyhow, ZNOG's MJ1&2 well isn't that far away (20 miles or less) and their lease runs NW even closer to the Southern Golan Ness region should their science lead them in that direction to drill in the future...

When I did my research on this, it was implying that it would have to be fracked. The thick layers were not conventional. This was the time that Givot was having troubles I think.

ZN may have already encountered a similar formation at similar depth if geology is mostly the same. JB mentioned the Genie discovery in a 2016 ZN press release but I'm still not sure if anyone at ZN confirmed in a podcast or pr if they found similar formations in their well bores at the 5-7k ft depth? (Genie had a smaller rig and I think they stopped drilling at 7-8k meters down)

Yes to different critters. If you looked at the board of Genie it was a conglomerate of large political players. The US recognized the Israeli rights to the Golan during this time as well. This is important.

Afek Oil and Gas, In November 2017, the company announced that it suspended its exploratory drilling program as the well's target zone does not contain commercially producible quantities of oil or natural gas.

I call BS on this one. This was all about politics. Crude was $57 at this time. See below.

Human rights groups have said the drilling violates international law as Golan Heights is an occupied territory.

There you have it among other reasons. One thing to keep in mind, Fracking was having a rough time in the US from the environmental folks. I do not think it is in the cards as Israel is worried about the technology. When it is perfected, then the ballgame changes. Ratbike taught me a lot about that stuff then. It would not have been economical at $100.

NBL may not of had a choice either. Once the discovery is announced, in order to take full advantage of the field in a "timely" matter, Zion may have to be able to prove their ability to take advantage of the field in a "timely" matter or sell all or part of their license. They may be told to partner with other bigger names. One thing about the large gas discoveries, I do not believe that a single exploration company was in full ownership and control of their discovery. When you do some research, you find that there are three or four companies involved in the commercial realization of the discovery. I do believe that Gazprom (a Russian company) has also been engaged.

This does worry me a little. If Zion hits and hits big, they would not be able to handle it. However, the Israeli government would step in at that point and take control of it. Zion is the sole license holder, so it would be very expensive to 'buy' in. If not a huge find then Zion oil and its drilling should be able to handle it. They would of course rent the other rigs in the area. Afek still has theirs in country I think.

Israel's Energy Ministry may bring pressure to bear on the company. One thing is certain (and may explain why Zion has requested a new 3 year leased on their current lease), the leases surround the Megiddo Jezreel license will be hot areas of interest.

Yes this makes sense in a lot of ways and the timing of such a request. That is pure conjecture but circumstantial evidence is still pertinent these days to some extent.
Anyhow, off to look into the abiotic stuff here in the US on land. This could be tough to find and I did not save it on my website.



Edit:

In the meantime, if we do have to form a strategic partnership with one of the big boys (i.e. Chevron), we would do so primarily because of their deep pockets.

That strategic partnership may end up being with a company like Gazprom in an attempt to appease Russian interest in Israel and may be why they have been allowed to participate in the world class gas discoveries off the coast.

I agree with this a lot.