Post by Ethan / JRyan on Mar 28, 2023 10:30:11 GMT -5
March 27 10-k Filing - LINK
The Whale(s) Update: No Update for 1Q 2023. Yet we have a funding drive so that makes things even more vague.
There had better be some news or to the Pinksheets we go in July 2023.
Just a note about the SEC investigation, it is still ongoing but the lawsuits were dropped long ago. I refer to this as the Pandaization of Zion Oil. Targeted but that is my opinion.
Questions
Is the ban on insider sales of stock still in place? They can purchase shares and executives are granted shares but they have not to the best of my knowledge been able to sell them. I need to confirm this is still in place. It makes a HUGE difference in perceptions.
Warrants - Lots of information about them, but not in my interest at this time as I own none. However that and stock options are a big portion of the incentive to employees and directors.
No real news just waiting on the license. That being said, Israel has very large issues right now with the potential Judicial changes. I am not getting into politics but I can see both sides to this coin and have no opinion.
Syria is heating up, the US and Iran are now engaging each other in limited ways. This could go hot at any moment.
Lots of things at play, Zion Oil and its vision could be seen by some to be a part of this. I do not think so. I think Zion Oil is on its last legs and that whether they find anything is up to the man upstairs.
While the MJ #1 well was not commercially viable, Zion learned a great deal from the drilling and testing of this well. We believed that the drilling and testing of this well carried out the testing objectives which would support further evaluation and potential further exploration efforts within our License area. Zion believed it was prudent and consistent with good industry practice to examine further these questions with a focused 3-D seismic imaging shoot of approximately 72 square kilometers surrounding the MJ#1 well. Zion completed all of the acquisition, processing and interpretation of the 3-D data and incorporated its expanded knowledge base into the drilling of our Megiddo Jezreel #2 (“MJ-02”, “MJ-2” or “MJ #2”) exploratory well.
On March 12, 2020, Zion entered into a Purchase and Sale Agreement with Central European Drilling kft, a Hungarian corporation, to purchase an onshore oil and gas drilling rig, drilling pipe, related equipment and spare parts for a purchase price of $5.6 million in cash, subject to acceptance testing and potential downward adjustment. We remitted to the Seller $250,000 on February 6, 2020 as earnest money towards the Purchase Price. The Closing anticipated by the Agreement took place on March 12, 2020 by the Seller’s execution and delivery of a Bill of Sale to us. On March 13, 2020, the Seller retained the earnest money deposit, and the Company remitted $4,350,000 to the seller towards the purchase price, and $1,000,000 (the “Holdback Amount”) was deposited in escrow with American Stock Transfer and Trust Company LLC. On January 6, 2021, Zion completed its acceptance testing of the I-35 drilling rig and the Holdback Amount was remitted to Central European Drilling.
The New Megiddo License 428 (“NML 428”) was awarded on December 3, 2020 for a six-month term with the possibility of an additional six-month extension. On April 29, 2021, Zion submitted a request to the Ministry of Energy for a six-month extension to December 2, 2021. On May 30, 2021, the Ministry of Energy approved our request for extension to December 2, 2021. On November 29, 2021, the Ministry of Energy approved our request for extension to August 1, 2022. On July 25, 2022, Zion submitted a request to the Ministry of Energy for a six-month extension to February 1, 2023. On July 31, 2022, the Ministry of Energy approved our request for extension to February 1, 2023. The NML 428 expired on February 1, 2023, but the Company applied for a replacement license prior to such expiration. At the time of the filing of this Annual Report, this replacement license is pending.
During the third quarter of 2022, Zion perforated and stimulated two deep zones.
On October 3, 2022, Zion sent a database email update to its supporters announcing the following: (1) We were encouraged by the results of our recent testing operations, especially the lower zone (approximately 20 meters in thickness), which was our primary zone of interest, (2) we were facing a downhole obstacle in the form of heavy water influx from the upper zone inhibiting the potential flow of hydrocarbons from the lower zone and (3) after consultation with outside experts, we planned to isolate and neutralize the heavy water influx by procuring a 4.5” packer and installing it below the heavy water zone and above our primary zone.
Zion suspended its operations at the MJ-02 pad site during October 2022 due to several Jewish holidays during the month. Beginning in early November 2022, Zion resumed its testing operations after procuring the necessary equipment and personnel.
On December 9, 2022, Zion sent a database email update to its supporters announcing the following: (1) after a thorough analysis of the results by Zion and third party experts, Zion determined that the well will not currently produce hydrocarbons in commercial quantities, (2) although logs strongly indicate the presence of hydrocarbons, we have determined the zone does not have sufficient permeability to be productive, (3) we will set a temporary plug in the wellbore to preserve its integrity and the opportunity to make future use of it, should circumstances and technological innovations warrant that, (4) based on what we learned about the characteristics of this deep Mohilla zone in the MJ-2 well, we are aggressively re-analyzing our logs and other data from the MJ-1 well, which was drilled on the same pad site. Knowing this zone is structurally higher than the equivalent zone in MJ-2, we are diligently evaluating whether this zone was adequately tested in the MJ-1 well, (5) once we have completed that analysis, we may re-enter the MJ-1 wellbore, which is cased to the bottom, and attempt a re-completion in the Mohilla zones, and (6) we will continue to explore the Megiddo-Jezreel license area as we are confident that we are in an active petroleum system.
As a result, in the year ended December 31, 2022, the Company recorded a non-cash impairment charge to its unproved oil and gas properties of $45,615,000. During the year ended December 31, 2021, the Company did not record any non-cash impairment charge.
Zion Oil & Gas, Inc. filed an amended application with the Israel Ministry of Energy for a new exploratory license on January 24, 2023 covering the same area as its License No. 428, which expired on February 1, 2023. However, its original application to replace License No. 428 was filed on May 11, 2022, and a revised application was filed on August 29, 2022.
With a third parliamentary election in Israel since March 2, 2020, on November 1, 2022, review of Zion’s new license application was delayed. After the election, an ongoing transition period has taken place. A new Minister of Energy took office on January 1, 2023 and appointed a new Director General of the Ministry.
As previously reported, Zion has re-examined the logs and other data from its MJ-01 well in preparation for a planned re-entry. Zion’s license application was therefore amended to address the planned re-entry, requiring a change in the workplan portion of the application, and then re-submitted on January 24, 2023.
Since May of 2022, Zion has worked closely with all the necessary Ministry officials to address questions and resolve any issues raised by its application. Zion therefore believes it has met all of the preliminary license requirements. Although no assurances can be made, Zion anticipates its license application will be favorably considered by the Ministry and other necessary regulatory agencies.
In the interim, Zion plans to leave its I-35 drilling rig and all related components on its current pad site and perform necessary rig maintenance, engineering and design for the planned re-entry.
On March 12, 2020, Zion entered into a Purchase and Sale Agreement with Central European Drilling kft, a Hungarian corporation, to purchase an onshore oil and gas drilling rig, drilling pipe, related equipment and spare parts for a purchase price of $5.6 million in cash, subject to acceptance testing and potential downward adjustment. We remitted to the Seller $250,000 on February 6, 2020 as earnest money towards the Purchase Price. The Closing anticipated by the Agreement took place on March 12, 2020 by the Seller’s execution and delivery of a Bill of Sale to us. On March 13, 2020, the Seller retained the earnest money deposit, and the Company remitted $4,350,000 to the seller towards the purchase price, and $1,000,000 (the “Holdback Amount”) was deposited in escrow with American Stock Transfer and Trust Company LLC. On January 6, 2021, Zion completed its acceptance testing of the I-35 drilling rig and the Holdback Amount was remitted to Central European Drilling.
The New Megiddo License 428 (“NML 428”) was awarded on December 3, 2020 for a six-month term with the possibility of an additional six-month extension. On April 29, 2021, Zion submitted a request to the Ministry of Energy for a six-month extension to December 2, 2021. On May 30, 2021, the Ministry of Energy approved our request for extension to December 2, 2021. On November 29, 2021, the Ministry of Energy approved our request for extension to August 1, 2022. On July 25, 2022, Zion submitted a request to the Ministry of Energy for a six-month extension to February 1, 2023. On July 31, 2022, the Ministry of Energy approved our request for extension to February 1, 2023. The NML 428 expired on February 1, 2023, but the Company applied for a replacement license prior to such expiration. At the time of the filing of this Annual Report, this replacement license is pending.
During the third quarter of 2022, Zion perforated and stimulated two deep zones.
On October 3, 2022, Zion sent a database email update to its supporters announcing the following: (1) We were encouraged by the results of our recent testing operations, especially the lower zone (approximately 20 meters in thickness), which was our primary zone of interest, (2) we were facing a downhole obstacle in the form of heavy water influx from the upper zone inhibiting the potential flow of hydrocarbons from the lower zone and (3) after consultation with outside experts, we planned to isolate and neutralize the heavy water influx by procuring a 4.5” packer and installing it below the heavy water zone and above our primary zone.
Zion suspended its operations at the MJ-02 pad site during October 2022 due to several Jewish holidays during the month. Beginning in early November 2022, Zion resumed its testing operations after procuring the necessary equipment and personnel.
On December 9, 2022, Zion sent a database email update to its supporters announcing the following: (1) after a thorough analysis of the results by Zion and third party experts, Zion determined that the well will not currently produce hydrocarbons in commercial quantities, (2) although logs strongly indicate the presence of hydrocarbons, we have determined the zone does not have sufficient permeability to be productive, (3) we will set a temporary plug in the wellbore to preserve its integrity and the opportunity to make future use of it, should circumstances and technological innovations warrant that, (4) based on what we learned about the characteristics of this deep Mohilla zone in the MJ-2 well, we are aggressively re-analyzing our logs and other data from the MJ-1 well, which was drilled on the same pad site. Knowing this zone is structurally higher than the equivalent zone in MJ-2, we are diligently evaluating whether this zone was adequately tested in the MJ-1 well, (5) once we have completed that analysis, we may re-enter the MJ-1 wellbore, which is cased to the bottom, and attempt a re-completion in the Mohilla zones, and (6) we will continue to explore the Megiddo-Jezreel license area as we are confident that we are in an active petroleum system.
As a result, in the year ended December 31, 2022, the Company recorded a non-cash impairment charge to its unproved oil and gas properties of $45,615,000. During the year ended December 31, 2021, the Company did not record any non-cash impairment charge.
Zion Oil & Gas, Inc. filed an amended application with the Israel Ministry of Energy for a new exploratory license on January 24, 2023 covering the same area as its License No. 428, which expired on February 1, 2023. However, its original application to replace License No. 428 was filed on May 11, 2022, and a revised application was filed on August 29, 2022.
With a third parliamentary election in Israel since March 2, 2020, on November 1, 2022, review of Zion’s new license application was delayed. After the election, an ongoing transition period has taken place. A new Minister of Energy took office on January 1, 2023 and appointed a new Director General of the Ministry.
As previously reported, Zion has re-examined the logs and other data from its MJ-01 well in preparation for a planned re-entry. Zion’s license application was therefore amended to address the planned re-entry, requiring a change in the workplan portion of the application, and then re-submitted on January 24, 2023.
Since May of 2022, Zion has worked closely with all the necessary Ministry officials to address questions and resolve any issues raised by its application. Zion therefore believes it has met all of the preliminary license requirements. Although no assurances can be made, Zion anticipates its license application will be favorably considered by the Ministry and other necessary regulatory agencies.
In the interim, Zion plans to leave its I-35 drilling rig and all related components on its current pad site and perform necessary rig maintenance, engineering and design for the planned re-entry.
Zion Oil & Gas, Inc. filed an amended application with the Israel Ministry of Energy for a new exploratory license on January 24, 2023 covering the same area as its License No. 428, which expired on February 1, 2023. However, its original application to replace License No. 428 was filed on May 11, 2022, and a revised application was filed on August 29, 2022.
The NML 428 lies onshore, south and west of the Sea of Galilee, and we continue our exploration focus here based on our studies as it appears to possess the key geologic ingredients of an active petroleum system with significant exploration potential.
With a third parliamentary election in Israel since March 2, 2020, on November 1, 2022, review of Zion’s new license application was delayed. After the election, an ongoing transition period has taken place. A new Minister of Energy took office on January 1, 2023 and appointed a new Director General of the Ministry.
As previously reported, Zion has re-examined the logs and other data from its MJ-01 well in preparation for a planned re-entry. Zion’s license application was therefore amended to address the planned re-entry, requiring a change in the workplan portion of the application, and then re-submitted on January 24, 2023.
Since May of 2022, Zion has worked closely with all the necessary Ministry officials to address questions and resolve any issues raised by its application. Zion therefore believes it has met all of the preliminary license requirements. Although no assurances can be made, Zion anticipates its license application will be favorably considered by the Ministry and other necessary regulatory agencies.
In the interim, Zion plans to leave its I-35 drilling rig and all related components on its current pad site and perform necessary rig maintenance, engineering and design for the planned re-entry.
Zion’s Former Joseph License
Zion has plugged all of its exploratory wells on its former Joseph License area, and the reserve pits have been evacuated, but acknowledges its obligation to complete the abandonment of these well sites in accordance with guidance from the Energy Ministry, Environmental Ministry and local officials.
The NML 428 lies onshore, south and west of the Sea of Galilee, and we continue our exploration focus here based on our studies as it appears to possess the key geologic ingredients of an active petroleum system with significant exploration potential.
With a third parliamentary election in Israel since March 2, 2020, on November 1, 2022, review of Zion’s new license application was delayed. After the election, an ongoing transition period has taken place. A new Minister of Energy took office on January 1, 2023 and appointed a new Director General of the Ministry.
As previously reported, Zion has re-examined the logs and other data from its MJ-01 well in preparation for a planned re-entry. Zion’s license application was therefore amended to address the planned re-entry, requiring a change in the workplan portion of the application, and then re-submitted on January 24, 2023.
Since May of 2022, Zion has worked closely with all the necessary Ministry officials to address questions and resolve any issues raised by its application. Zion therefore believes it has met all of the preliminary license requirements. Although no assurances can be made, Zion anticipates its license application will be favorably considered by the Ministry and other necessary regulatory agencies.
In the interim, Zion plans to leave its I-35 drilling rig and all related components on its current pad site and perform necessary rig maintenance, engineering and design for the planned re-entry.
Zion’s Former Joseph License
Zion has plugged all of its exploratory wells on its former Joseph License area, and the reserve pits have been evacuated, but acknowledges its obligation to complete the abandonment of these well sites in accordance with guidance from the Energy Ministry, Environmental Ministry and local officials.
The Whale(s) Update: No Update for 1Q 2023. Yet we have a funding drive so that makes things even more vague.
Currently, we are substantially reliant on the proceeds of sales of our common stock under the Dividend Reinvestment and Stock Purchase Plan. During the past two completed fiscal years, we have financed our operations primarily from the proceeds of sales of our stock under the Dividend Reinvestment and Stock Purchase Plan. For the years ended December 31, 2022 and 2021, we raised approximately $19,129,000 and $26,219,000, respectively, under the Plan. Of the amounts raised, approximately 77% of the amounts raised in 2022 were attributable to two participants and 67% of the amounts raised in 2021 were attributable to two participants. The cessation of funding from these participants may result in adverse consequences to our business, such as a delay in our testing efforts, until we locate alternate sources for this funding.
There had better be some news or to the Pinksheets we go in July 2023.
On January 11, 2023, OTC Markets emailed a letter to Zion advising that its bid price has closed below $.10 for more than 30 consecutive calendar days and no longer meets the Standards for Continued Qualification for the OTCQX U.S. tier per the OTC Rules for U.S. Companies. In the event that the Company’s bid price, the Market Capitalization, or the number of Market Makers fall below the minimum criteria established in Section 3.2(b), a cure period of 180 calendar days to regain compliance shall begin, during which the applicable criteria must be met for ten consecutive trading days.
The 180-calendar day cure period expires July 10, 2023. If at that time the Company’s bid price has not stayed at or above the $.10 minimum for ten consecutive trading days, then the security will be moved from OTCQX to the OTC Pink market unless Zion requests that it be moved to the OTCQB market.
No assurance can be provided that we will be able to maintain continued listing on OTCQX. Moving from the OTCQX Market may have an adverse effect on our ability to raise the capital needed to continue our oil and gas exploration efforts and maintain operations
The 180-calendar day cure period expires July 10, 2023. If at that time the Company’s bid price has not stayed at or above the $.10 minimum for ten consecutive trading days, then the security will be moved from OTCQX to the OTC Pink market unless Zion requests that it be moved to the OTCQB market.
No assurance can be provided that we will be able to maintain continued listing on OTCQX. Moving from the OTCQX Market may have an adverse effect on our ability to raise the capital needed to continue our oil and gas exploration efforts and maintain operations
Just a note about the SEC investigation, it is still ongoing but the lawsuits were dropped long ago. I refer to this as the Pandaization of Zion Oil. Targeted but that is my opinion.
We are involved in an ongoing government investigation by the United States Securities and Exchange Commission, the results of which may have a material adverse effect on our consolidated financial condition and business.
On June 21, 2018, the Fort Worth Regional Office of the SEC informed Zion that it was conducting a formal, non-public investigation and asked that we provide certain information and documents in connection with its investigation. Since that date, we have fully cooperated with the SEC on an on-going basis in connection with its investigation. Investigations of this nature are inherently uncertain and their results cannot be predicted with certainty. Regardless of the outcome, an SEC investigation could have an adverse impact on us because of legal costs, diversion of management resources, and other factors. The investigation could also result in reputational harm to Zion and may have a material adverse effect on Zion’s current and future business and exploratory activities and its ability to raise capital to continue our oil and gas exploratory activities.
On June 21, 2018, the Fort Worth Regional Office of the SEC informed Zion that it was conducting a formal, non-public investigation and asked that we provide certain information and documents in connection with its investigation. Since that date, we have fully cooperated with the SEC on an on-going basis in connection with its investigation. Investigations of this nature are inherently uncertain and their results cannot be predicted with certainty. Regardless of the outcome, an SEC investigation could have an adverse impact on us because of legal costs, diversion of management resources, and other factors. The investigation could also result in reputational harm to Zion and may have a material adverse effect on Zion’s current and future business and exploratory activities and its ability to raise capital to continue our oil and gas exploratory activities.
Questions
Is the ban on insider sales of stock still in place? They can purchase shares and executives are granted shares but they have not to the best of my knowledge been able to sell them. I need to confirm this is still in place. It makes a HUGE difference in perceptions.
Warrants - Lots of information about them, but not in my interest at this time as I own none. However that and stock options are a big portion of the incentive to employees and directors.
No real news just waiting on the license. That being said, Israel has very large issues right now with the potential Judicial changes. I am not getting into politics but I can see both sides to this coin and have no opinion.
Syria is heating up, the US and Iran are now engaging each other in limited ways. This could go hot at any moment.
Lots of things at play, Zion Oil and its vision could be seen by some to be a part of this. I do not think so. I think Zion Oil is on its last legs and that whether they find anything is up to the man upstairs.