When"
will Oil Be Found in Israel?
"How to invest in Zion Oil"
"Now is the time to favor Zion"
An angel's view of the Ma'anit-Rehoboth
drill site.

Zion Oil and Gas, Inc.
may be found on the NASDAQ stock exchange
http://www.nasdaq.com/
under the symbols
ZN (these are the shares)
ZNWAZ (these are warrants with an exercise date of December 2012
Also ZNWAL (these are warrants with an exercise date of August 31, 2012)
ZNWAW (these are older warrants, avoid these warrants, nearing expiration
date)
Attention potential
Investors
You may call Zion Oil and Gas at their Dallas office and request an
Investor's package
without cost or obligation.
The package includes a book, DVD, CDs, and written materials.
Zion Oil & Gas, Inc. 6510 Abrams Rd., Suite 300, Dallas, TX 75231
telephone 1-214-221-4610; email:
dallas@zionoil.com
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~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Zion Oil & Gas Newsletter
Tuesday, January 31, 2012
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Dear Shareholder and/or Friend of Zion.

Zion's President and Chief
Operating Officer: Victor G. Carrillo

Zion's Exploration
Department
Left to Right: Victor G. Carrillo, Liat Roter, Dr. Eliezer Kashai, Aaron
Kahn
During the past
month, Zion's President and Chief Operating Officer, Victor G. Carrillo
visited Israel. He held various meetings with our Israel-based exploration
team, discussing our latest geological and geophysical findings and our
future plans. Victor spent time out in the field on our license areas
and also meeting with our Israel-based Board members.

Zion's Petroleum
Exploration License Areas
In our Jordan Valley
License area, the permitting for the 2-D seismic survey (using a
dynamite source) is progressing and we currently expect
that the survey will be performed by the Geophysical Institute of Israel (GII)
in March 2012. Of course these dates are estimates and are subject to
change based on GII's schedule of commitments.
That seismic should help us to further refine our plans to drill in the Jordan Valley License area.
With regard to our planned VSP
(vertical seismic profile) survey in our Asher-Menashe License
area, which will be acquired by a third party
contractor with assistance by GII, we still need to secure appropriate
equipment in line with our planned schedule. I am optimistic that in my next
update to you, I will have some positive news regarding this.
With regard to our
Joseph License area, our scientific work continues. A summary
report (of all work to date) and a quarterly report (for the
quarter ended December 31, 2011) were due to Israel's Petroleum Commissioner
by January 31, 2012. These were submitted in a timely manner
and we look forward to discussing our findings with the Petroleum
Commissioner.

In January 2012, to his great
credit, geologist Aaron Kahn was accepted as a member of the American
Association of Petroleum Geologists
(AAPG). He joins Victor Carrillo, Dr. Eliezer Kashai and Zion Board member
Dr. Yehezkel Druckman, as they are all AAPG members.
Recently, there has been
somewhat of a 'shake-up' in Israel's government departments dealing with
natural resources. In mid-2011, Dr. Gardosh
was appointed Israel's Petroleum Commissioner on an interim basis, but there
is a six-month restriction on any interim appointments. As of
January 1, 2012, Mr. Alexander Varshavsky is the new
(interim) Commissioner of Petroleum Affairs and the Ministry of
Infrastructure
has been renamed the Ministry of Energy and Water Resources.
The map above shows Zion's current petroleum exploration licenses:
Zion's total license area amounts to approximately 218,000 acres.

Zion's Applications for
additional Petroleum Exploration Areas
In 2011, we submitted applications to the Israeli Petroleum Commissioner for three further exploration areas:
If all of our applications are granted, the total petroleum exploration area under Zion's control would be approximately 530,000 acres.
I have recently put in a request
to meet with the new Petroleum Commissioner, in order to wish him every
success and also to request
that our applications be considered, as soon as possible.
Early this month, Zion's Founder
and Chairman, John Brown, was on a trip led by Dr. David Jeremiah (who has
shown much interest in Zion's work)
and this past week, John attended the 26th Annual Pastor's Conference in
Jacksonville, Florida. Many pastors showed great interest in Zion's work
to date as well as our future plans.

John Brown and Richard
Rinberg being interviewed on American Family Radio
at the 2010 NRB Convention
In February 2012, John Brown and
I plan to attend the National Religious Broadcasters Convention in
Nashville, Tennessee.
Last year, the interviews that John and I gave were warmly received and
resulted in much interest in Zion's work.
"In your good pleasure, make Zion
prosper..."
Psalm 51:18
Thank you for your support of Zion
Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
FORWARD LOOKING STATEMENTS: Statements in this communication that are not historical fact, including statements regarding Zion's planned operations, anticipated attributes of geological strata being drilled, the presence or recoverability of hydrocarbons, plans to perform seismic surveys, the timing of these surveys, the impact of these surveys on identifying drilling prospects, the grant of applied-for exploration license and permits, the sufficiency of cash reserves, timing and potential results thereof and plans contingent thereon are forward-looking statements as defined in the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on assumptions that are subject to significant known and unknown risks, uncertainties and other unpredictable factors, many of which are described in Zion's periodic reports filed with the SEC and are beyond Zion's control. These risks could cause Zion's actual performance to differ materially from the results predicted by these forward-looking statements. Zion can give no assurance that the expectations reflected in these statements will prove to be correct and assumes no responsibility to update these statements.
Contact Information:
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
More information about Zion is available at
www.zionoil.com
or by contacting Mike Williams (dallas@zionoil.com)
Zion Oil & Gas, Inc.
6510 Abrams Rd., Suite 300
Dallas, TX 75231
Tel: 1-214-221-4610 or 1-888-891-9466

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Zion Oil & Gas Newsletter
Tuesday,
November 1, 2011
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Dear
Shareholder and/or Friend of Zion...
October has been a very active month at Zion Oil & Gas.
On October 6, 2011, we signed an agreement with the Geophysical Institute of
Israel (GII) for the acquisition of approximately 15 kilometers (9 miles) of
seismic data in our recently acquired Jordan Valley License area. The
seismic survey is scheduled to commence in late 2011 or early in 2012.
On October 11, 2011, we renewed the lease on our office premises in Dallas,
Texas and rented some additional adjacent space in the building. To reduce
costs, we are closing Zion's office in State College, Pennsylvania; we will
now have space in Dallas for both a geology and engineering department.

After a
long period of negotiation with various oil & gas companies, on October 14,
2011, Zion signed a non-binding Memorandum of Understanding (MOU) with a
United States based company affiliated with an oil & gas exploration company
with significant international operations. We plan that they will provide
Zion with an onshore drilling rig with deep drilling capacity and certain
other oilfield services for a minimum of three years and for at least three
new wells that we plan to drill on our license areas. However, we will need
to prepare, negotiate and execute legally binding documentation before we
can begin our formal relationship.

We are excited and encouraged that, on October 17, 2011 (petroleum geologist, geophysicist and, for eight years, statewide-elected commissioner of the Railroad Commission of Texas - the state's chief oil and gas regulatory agency), Victor G. Carrillo, was appointed as Zion's new President and Chief Operating Officer. Victor was appointed following Bill Ottaviani's departure from Zion, by mutual agreement, on October 14, 2011. Victor has been serving as Zion's Executive Vice President since January 2011 and as a director since September 2010. He will continue to serve as a member of Zion's Board of Directors.

Left to Right: Aaron Kahn (Geologist), Liat Roter (Geophysicist)
On October 23, 2011, we were pleased to welcome an additional staff member to our Israel exploration department: Ms. Liat Roter, a geophysicist who has just completed the work for her Masters (M.Sc.) in geosciences at the University of Haifa. We are steadily improving our exploration department, as that is Zion's 'engine for growth' as we pursue our exploration plans.

Left to Right:
Senator Mary Landrieu, Richard Rinberg (Zion's CEO), Ilan Sheena (Zion's
CFO)
Also on October 23, 2011, a US delegation - the Louisiana Oil & Gas Trade Mission, arrived in Israel. The delegation was led by (The Honorable) Mary Landrieu, Senator for the State of Louisiana. Senator Landrieu is on her third visit to Israel and commented: "... we really value our relationship with Israel and want to see it strengthened".
Louisiana
has some of the world's leading companies that deal in developing oil and
gas ventures and the delegation comprised a number of oil & gas service
providers who are eager to help Israel's fledgling oil and gas industry to
grow stronger. On October 24, we attended a seminar on the topic of
'Oil & Gas in Israel'
that was arranged under the auspices of the Southwest Louisiana Economic
Development Alliance and the US Department of Commerce.
We weren't complete strangers to Louisiana as, for a number of years, Zion
Board member (and Petroleum Commissioner for the State of Israel from 1995,
until his retirement in 2004), Dr.Yehezekel (Charlie) Druckman, was
affiliated with the Louisiana State University at Baton Rouge as a Research
Associate in Geology. That evening, US Ambassador, Daniel B. Shapiro, gave a
reception at his home in Herzliya.
It is clear that there is a growing interest in Israel's energy industry.
That can only be good for Zion, as competition by service providers will
inevitably drive down costs for the provision of services.

Finally,
on October 26, 2011, we received from the Petroleum Commissioner of Israel,
as requested, an extension on our Joseph License to October 10, 2012, so we
can continue with our petroleum exploration plans on that license area.
Taken together, the various steps we have made in October 2011 position us
well for the coming months. We are looking forward to drilling our next well
- we plan to start drilling in the first half of 2012 - and are hopeful that
the discovery that has so far eluded us will come in 2012.
In Latin:
"Fortuna erudites favet",
in English:
"Fortune
favors the prepared"
and in the Psalms:
"In your good pleasure, make Zion prosper..."
Psalm 51:18
Thank you for
your support of Zion
Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
www.zionoil.com
FORWARD LOOKING STATEMENTS: Statements in this communication that
are not historical fact, including statements regarding Zion's planned
operations, anticipated attributes of geological strata being drilled, the
presence or recoverability of hydrocarbons, plans to commence a 2D seismic
survey, that seismic acquisition is expected to begin in 2011 or 2012, that
the results will improve the quality of existing data and increase the
chances of success of planned exploratory wells, the sufficiency of cash
reserves, timing and potential results thereof and plans contingent thereon
are forward-looking statements as defined in the "Safe Harbor" provisions of
the Private Securities Litigation Reform Act of 1995. These forward looking
statements are based on assumptions that are subject to significant known
and unknown risks, uncertainties and other unpredictable factors, many of
which are described in Zion's periodic reports filed with the SEC and are
beyond Zion's control. These risks could cause Zion's actual performance to
differ materially from the results predicted by these forward-looking
statements. Zion can give no assurance that the expectations reflected in
these statements will prove to be correct and assumes no responsibility to
update these statements.
Contact
Information:
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
More information about Zion is available at
www.zionoil.com
or by contacting Mike Williams
(dallas@zionoil.com)
Zion Oil & Gas, Inc.
6510 Abrams Rd., Suite 300
Dallas, TX 75231
Tel: 1-214-221-4610 or 1-888-891-9466
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Zion Oil & Gas Newsletter
Friday, October 7, 2011
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Dear Shareholder and/or Friend of Zion...
We are moving forward with our exploration plans.

Recently, we negotiated
a seismic acquisition agreement with the Geophysical Institute of Israel (GII)
to conduct a 2D field seismic survey in our recently acquired Jordan Valley
License area. This past week,
the seismic acquisition agreement was signed.
The field acquisition is scheduled to commence in late 2011 or early in
2012.
On Thursday, October 6, 2011, we issued a
press release
regarding the seismic acquisition agreement. You can review the press
release at the end of this message.
Previously, Zion's field
seismic acquisition programs have involved Vibroseis vehicles to send out
the primary seismic energy source.

Vibroseis trucks in
Israel.
Vibroseis technology
uses vehicle-mounted vibrators (commonly called “vibes”) to transmit seismic
energy into the ground that then allows our geoscientists to “see”
underground structures.
However, this time, in order to bring forward our acquisition date we have
decided to use dynamite.

The collection of seismic data involves sending shock waves
into the ground and measuring how long it takes for the subsurface rocks to
reflect these waves back to the surface.
The shock waves for our seismic acquisition will be generated by exploding
small dynamite charges in buried, shallow holes.
When the shock waves created by the dynamite travel into the earth,
boundaries between the rocks reflect the waves back, and the arrival times
of the waves back at the surface are detected by listening devices called
receiver geophones.
Computers then process the geophone data and convert it into seismic lines
-- two-dimensional displays that resemble subsurface geologic
cross-sections. Data collected in this fashion helps us to create computer
models of the underground geometries of the rocks.

Our
schedules may change, but today, we believe that it is most likely that
Zion’s next well will be drilled in our Jordan Valley License in 2012.
Zion has three petroleum exploration license areas, onshore Israel,
comprising approximately 218,000 acres, and we are actively evaluating our
licenses and planning for our next wells.
We have 100% working interest in our licenses, an experienced and
professional team and unlike many countries and companies...
no outstanding debt.
...................................................

On
Friday evening, October 7, 2011, Yom Kippur (Israel’s 'Day of Atonement')
begins. It is a day of fasting, prayer and introspection where we seek
forgiveness for wrongs that we may have done.
As I commented in my previous update, the road to success comes through hard
work, determination, and personal sacrifice, so, we are redoubling our work
efforts and examining every part of our business to ensure that we allocate
Zion's strategic resources correctly and execute our planned drilling
program with the minimum possible delay.
“In your good pleasure, make Zion prosper…”
Psalm 51:18
Thank you for your support
of Zion and
'Chatimah Tovah'
(A Yom Kippur greeting, meaning, "May
you be sealed in the Book of Life")
Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
www.zionoil.com
FORWARD LOOKING STATEMENTS: Statements in this communication that are not
historical fact, including statements regarding Zion's planned operations,
anticipated attributes of geological strata being drilled, the presence or
recoverability of hydrocarbons, plans to commence a 2D seismic survey, that
seismic acquisition is expected to begin in 2011 or 2012, that the results
will improve the quality of existing data and increase the chances of
success of planned exploratory wells, the sufficiency of cash reserves,
timing and potential results thereof and plans contingent thereon are
forward-looking statements as defined in the "Safe Harbor" provisions of the
Private Securities Litigation Reform Act of 1995. These forward looking
statements are based on assumptions that are subject to significant known
and unknown risks, uncertainties and other unpredictable factors, many of
which are described in Zion's periodic reports filed with the SEC and are
beyond Zion's control. These risks could cause Zion's actual performance to
differ materially from the results predicted by these forward-looking
statements. Zion can give no assurance that the expectations reflected in
these statements will prove to be correct and assumes no responsibility to
update these statements.
Contact Information:
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
More information about Zion is available at
www.zionoil.com
or by contacting Mike Williams
(dallas@zionoil.com)
Zion Oil
& Gas, Inc.
6510 Abrams Rd., Suite 300
Dallas, TX 75231
Tel: 1-214-221-4610 or 1-888-891-9466
Zion Oil & Gas Signs Seismic Survey Contract
Dallas, Texas and Caesarea, Israel – October 6, 2011 – Zion Oil & Gas, Inc.
(NASDAQ GM:
ZN)
announced today that it has signed an agreement with the Geophysical
Institute of Israel relating to the acquisition of approximately 15
kilometers of 2D seismic lines located within Zion’s Jordan Valley License
area. The acquisition is expected to begin in the last quarter of 2011 or
the first quarter of 2012 and the total cost of the program, including
mobilization and demobilization, is projected to be approximately US$
380,000.
Zion’s Chief Executive Officer, Richard Rinberg, said today, “The planned
seismic survey in our Jordan Valley License area is being carried out in
order to add to our existing data and increase the chance of success of
exploratory wells in our petroleum exploration efforts. The proposed seismic
acquisition is intended to help us to evaluate the next steps we need to
take to identify one or more prospects within our Jordan Valley License
area.
I am optimistic about the possibility of recovering hydrocarbons within our
license areas, onshore Israel, especially due to the U.S. Geological Survey
(USGS) report, published in April 2010, containing their assessment that
there may be 1.7 billion barrels of recoverable oil and 122 trillion cubic
feet of recoverable gas in the Levant Basin, as all of Zion’s exploration
rights fall within the area of the Levant Basin.”
Zion’s common stock trades
on the NASDAQ Global Market under the symbol “ZN”
and Zion’s warrants trade under the symbols: “ZNWAW”, "ZNWAZ" and "ZNWAL".
Zion Oil
& Gas, a Delaware corporation, explores for oil and gas in Israel in areas
located onshore between Haifa and Tel Aviv. It currently holds three
petroleum exploration licenses: the Joseph License (on approximately 83,272
acres) and the Asher-Menashe License (on approximately 78,824 acres) between
Netanya, in the south, and Haifa, in the north, and the Jordan Valley
License (on approximately 55,845 acres), just south of the Sea of Galilee.
The total license area amounts to approximately 218,000 acres.
FORWARD LOOKING STATEMENTS: Statements in this communication that are not
historical fact, including statements regarding Zion’s planned operations,
geophysical and geological data and interpretation, anticipated attributes
of geological strata being drilled, drilling efforts and locations, the
presence or recoverability of hydrocarbons, plans to include up to 15 km of
2D seismic, that acquisition is expected to begin in 2011 or 2012, that the
cost will be as projected, that the results will improve the quality of
existing data and increase the chances of success of planned exploratory
wells, timing and potential results thereof and plans contingent thereon are
forward-looking statements as defined in the “Safe Harbor” provisions of the
Private Securities Litigation Reform Act of 1995. These forward looking
statements are based on assumptions that are subject to significant known
and unknown risks, uncertainties and other unpredictable factors, many of
which are described in Zion’s periodic reports filed with the SEC and are
beyond Zion’s control. These risks could cause Zion’s actual performance to
differ materially from the results predicted by these forward-looking
statements. Zion can give no assurance that the expectations reflected in
these statements will prove to be correct and assumes no responsibility to
update these statements.
Zion’s homepage may be found
at:
www.zionoil.com
Contact Information:
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
More information about Zion is available at
www.zionoil.com
or by contacting Mike Williams (dallas@zionoil.com)
Zion Oil & Gas, Inc.
6510 Abrams Rd., Suite 300
Dallas, TX 75231
Tel: 1-214-221-4610 or 1-888-891-9466
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Zion Oil & Gas Newsletter
Friday, July 29, 2011
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
During the past weeks, we have been heartened to receive messages of support and encouragement from stockholders who were participating in our rights offering.
Here is an example of a message sent to Zion's Founder and Chairman, John Brown. (To maintain anonymity, some detail has been removed.):
"Well, I decided to pull the trigger on the full amount allowed for the ZN Rights Offering today. Wrote a note to ZN in Dallas to let them know. Also tried to encourage them a bit in the note. We arrived in Florida and went to our church here. Our Pastor spoke on how to honor God and one point was that to honor Israel is to honor God. Hopefully, that is what we are trying to do with ZN, bring hope and survival resources to a land where these are sorely needed and can help provide security to the Israeli people."
It is very moving and humbling to read such beautiful messages of support.
Just as powerful was the support shown by many stockholders in our rights offering. By the originally scheduled termination date (July 25, 2011), we received subscriptions in excess of US$ 18 million.
In Jewish tradition, letters in the Hebrew alphabet correspond to numbers. (The first two letters of the Hebrew alphabet are 'Aleph' and 'Bet' - hence the English word 'alphabet'). The Hebrew word "CHAI" (meaning "LIFE" in English) corresponds to the number "18". The $18 million brings continued LIFE to our work in Israel.


Yesterday, we received final confirmation so, today, we issued a press release containing details of the final outcome of the rights offering, which were, as follows:
In total, subscriptions for approximately 4.9 million units, for gross proceeds of approximately US$24.5 million, were received (including over-subscriptions). All shareholders that requested over-subscription shares will be awarded their full over-subscription request.
As you can read in the press release, I commented that, "I am very pleased with the final outcome of our stock rights offering. We received subscriptions for almost 80% of the offered rights and now have the financial resources to significantly further our exploration and multi-well drilling program in Israel."
If you wish to review the press release, please click here.
In my news update on July 1, 2011, I noted that, based on the interpretation of the logging data that we obtained, there was little chance that the Ma'anit-Joseph #3 (MJ-3) well contained hydrocarbons in commercial quantities. However, as we recorded significant natural gas shows during drilling, we determined that it was in Zion's best interest to test the well.
This past week, Schlumberger, one of the world's leading oilfield services provider, performed an open-hole drill stem test and the test results confirmed that the MJ-3 well does not contain hydrocarbons in commercial quantities. Our geologists continue to analyze information gained during the 11 months of MJ-3 well operations - one of the deepest onshore wells ever drilled in Israel. They continue to reexamine their understanding of the geology of our license areas and we believe this reexamination should increase the probability of success in drilling future wells. No decision has yet been made with regard to the future utility and possible use of the MJ-3 well.
As I have previously mentioned, we are one of the first companies to have drilled this deep in Israel. We are truly drilling in uncharted territory and while we are assisted by modern geophysical data (seismic, gravity, magnetic) and other non-drilling exploratory options available to us, actual deep drilling is the best way to understand the geology of our license area and the possibilities for hydrocarbon discovery. As noted below, the drilling, logging and testing of the MJ-3 well has definitely furthered our understanding of the areas under exploration.
With regard to our future work, here are some of the areas on which we continue to work:
(i) The Joseph License - (on approximately 83,000 acres)
The drilling, logging and testing of the MJ-3 well gave us much information that is still being reviewed and analyzed. In light of the information gained, our geologists are refining their understanding of the overall geology and stratigraphy of our areas under exploration and of Northern Israel. There is at least one large nearby geologic structure that is being considered for key features that are normally associated with hydrocarbons. If we ultimately determine that we have to drill 'deeper', we want to ensure that the next drilling rig we use has the capacity to reach the deepest possible geologic target, rather than the previous rig that could only drill up to approximately 20,000 feet. This will provide more flexibility in our drilling program. We are also examining the possibility that there are continuous hydrocarbon-bearing strata that extend into our Joseph License from a currently hydrocarbon-producing region to the south of this license. Clearly, we still have much geological and geophysical work to carry out, but our drilling and testing, to date, have furthered our understanding of our petroleum exploration areas.
(ii) The Asher-Menashe License - (on approximately 79,000 acres)
In July, Israel's Petroleum Commissioner granted Zion a one-year extension of this license, in keeping with normal extension procedure. With information gained from drilling our recently finished MJ-3 well, our geologists will continue to examine the geology, stratigraphy, and hydrocarbon potential of this area to help determine our proposed future work schedule on this license area.
(iii) The Jordan Valley License - (on approximately 56,000 acres)
This past week, Zion's Victor Carrillo, Dr. Eliezer Kashai and Aaron Kahn, along with Viking International's seismic data acquisition specialist, Robert Dunn, were in the field, scouting the surface geology and discussing our upcoming proposed seismic acquisition. We plan to design seismic acquisition and processing parameters to enhance the likelihood of obtaining better quality deep seismic data, onshore Israel, to enable us to "see" better into the subsurface and thus minimize future drilling risk. Subsequently, Victor Carrillo and Robert Dunn met with Dr. Uri Frieslander, General Manager of the Geophysical Institute of Israel, to discuss Zion's future seismic acquisition plans. We were awarded the Jordan Valley License in April 2011 and we plan to drill a well within the license area by April 2013, at the latest.

(iv) Zion Drilling
As previously noted, we have been pursuing the idea of establishing Zion Drilling to ensure that Zion has control of a suitable drilling rig with the ability to drill deep onshore wells in Israel. We are looking for our next rig to have the ability to drill to a depth of up to 25,000 feet. We have now received two draft Memorandums of Understanding from interested companies. Whoever we decide to proceed with, we plan to insist that Zion Oil & Gas has majority control of its subsidiary, to be named Zion Drilling.
We plan to implement a multi-well program in Israel and have a number of opportunities that we wish to pursue, at the appropriate time.

(v) Future possibilities
We have three applications for new exploration areas pending before the Israeli Petroleum Commissioner's Office: the Asher-Joseph Permit, the Zebulun Permit and the Dead Sea License.
I remain optimistic about the possibility of recovering hydrocarbons on our license and permit areas, onshore Israel, especially due to the U.S. Geological Survey (USGS) report, published in April 2010, containing their assessment that there may be 1.7 billion barrels of recoverable oil and 122 trillion cubic feet of recoverable gas in the Levant Basin, as all of Zion's exploration rights fall within the area of the Levant Basin.
You can review the USGS Survey report if you click here.
"In your good pleasure, make Zion prosper..."
Psalm 51:18
Thank you for your support of Zion and Shalom from Israel.
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
FORWARD LOOKING
STATEMENTS:
Statements in this communication that are not historical fact, including
statements regarding Zion's planned operations, anticipated attributes of
geological strata being drilled, the presence or recoverability of
hydrocarbons, the sufficiency of cash reserves, the formation of a drilling
subsidiary and the negotiation and execution of agreements related thereto,
the ability to raise additional capital, timing and potential results
thereof and plans contingent thereon are forward-looking statements as
defined in the "Safe Harbor" provisions of the Private Securities Litigation
Reform Act of 1995. These forward looking statements are based on
assumptions that are subject to significant known and unknown risks,
uncertainties and other unpredictable factors, many of which are described
in Zion's periodic reports filed with the SEC and are beyond Zion's control.
These risks could cause Zion's actual performance to differ materially from
the results predicted by these forward-looking statements. Zion can give no
assurance that the expectations reflected in these statements will prove to
be correct and assumes no responsibility to update these statements.
Contact Information:
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
More information about Zion is available at www.zionoil.com
or by contacting Mike Williams (dallas@zionoil.com)at:
Zion Oil & Gas, Inc.
6510 Abrams Rd., Suite 300,
Dallas, TX 75231.
Tel: 1-214-221-4610 or 1-888-891-9466
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Friday, May 27, 2011
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Dear Shareholder and/or Friend of Zion...
Our mission is to explore for oil and gas in Israel and the State of Israel has granted Zion Oil & Gas petroleum exploration licenses that enable us to carry out our work.
Yesterday, Thursday, May 26,
2011, we received the formal documentation relating to our new Jordan
Valley License from Israel's Petroleum Commissioner. The area of this
license is approximately 226 square kilometers (equal to 55,845 acres).
Zion's Joseph License and Asher-Menashe License cover a total of approximately 162,000 acres. So, together with the Jordan Valley License, we now have a total of approximately 218,000 acres of petroleum exploration license area in northern Israel .This past week President Barack Obama called for a Middle East peace agreement based partly on boundaries in place before Israel's territorial gains in the 1967 war (the Six Day War). I know that some of our stockholders will want to know how proposed peace treaties and border changes could impact on Zion Oil & Gas and their investment.
Please note that all of Zion's current exploration areas fall within the pre-1967 borders. So, any proposed border changes as a result of peace treaty negotiations are highly unlikely to affect our licenses or our work.
As you can read below, our drilling operations during the past two weeks at the "Ma'anit-Joseph # 3 site have been proceeding well. We believe that penetrating the Permian geological layer with its potential for reservoirs is now very close within our grasp. We are all energized by the thought that, after years of work, we may soon achieve one of our long sought after goals.
We are careful to report on our operations in a fair and unbiased manner. When there have been problems, we have reported on them. On the other hand, when there is good news, I believe that we should also share that information - but in a way that does not cause unrealistic expectations.
During the last few days, we have been monitoring shows of natural gas coming out of the well. When we drilled the Ma'anit-Rehoboth #2 well, we also saw some indications of natural gas, but not as much as we have seen this past week. At this stage, all we can report is that we have seen evidence of hydrocarbons at the Ma'anit-Joseph #3 well. We cannot say anything about whether the current well will ultimately prove commercial or not. But clearly, this makes us all the more determined to continue to drill deeper into what we perceive to be the Permian targets in this well.
I'll conclude with a quote from Israel's outgoing Petroleum Commissioner, Dr. Ya'akov Mimran, who retires on May 31, 2011. This week, in an interview about Israel's oil & gas industry, published by "Globes" (Israel's business journal), he said:
"I'm very optimistic about both gas and oil discoveries. We're in a good place on the road. I also have faith in onshore wells by companies such as... Zion Oil & Gas Inc. (NASDAQ:ZN), which are targeting deep strata..."
.........................................................
Turning to our upcoming Annual Meeting of Stockholders, as this is so important to our good administration, I want to repeat a very important message for you, if you are a Zion Stockholder.

Zion's 2011 Annual Meeting of Stockholders will be held at:
The Westin Galleria Hotel, Dallas, Texas
on Tuesday, June 21, 2011
starting at: 2:00 p.m.
We have mailed material to you regarding the 2011 Annual Meeting. This will include a voting card so that you can vote your shares. The regulations concerning voting have recently changed, so it is very important that you support Zion by exercising your right to vote.
You can vote by:
(i) the internet (go to www.proxyvote.com)
(ii) telephoning: 1-800-690-6903
(iii) mail (by returning your voting card).
Zion has a great number of individual stockholders (as opposed to a few large institutions holding large blocks of stock), so please watch out for your voting card and take the few minutes to vote. Without your support with voting, we may have difficulty in properly administering Zion Oil & Gas, Inc. We depend on you to support us, so..
Drilling Operations at the Ma'anit-Joseph #3 Wellsite
Since the previous update, we have continued to "drill ahead" towards our bottom-hole target in the Permian geologic layer.
We have been drilling with PDC (Polycrystalline Diamond Compact) bits and generally have had excellent penetration rates and drill bit lives. One of our bits drilled an exceptionally long 1,600 feet (488 meters) before needing to be replaced.
Aside from routine testing of our blow-out prevention equipment, normal drilling operations in the past two weeks were briefly interrupted by a minor fishing operation to recover some PDC bit cutters and repair work to replace a leaking drilling rig swivel.
As of today, Friday May 27, 2011, we have reached a total measured depth of 17,276 feet (5,266 meters) and continue to drill towards our bottom-hole target of 19,360 feet (5,900 meters) in the Permian geologic layer.
Based on current projections and barring any unforeseen complications, we should reach this in mid to late June 2011. At that time we will acquire and assess open hole log data about the Permian formation to determine if we should run casing and perform production testing operations.
"In your good pleasure, make Zion prosper..."
Psalm 51:18
Thank you for your support of Zion and Shalom from Israel.
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
FORWARD LOOKING STATEMENTS: Statements in this communication that are not historical fact, including statements regarding Zion's planned operations, anticipated attributes of geological strata being drilled, the presence or recoverability of hydrocarbons, the sufficiency of cash reserves, ability to raise additional capital, timing and potential results thereof and plans contingent thereon are forward-looking statements as defined in the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on assumptions that are subject to significant known and unknown risks, uncertainties and other unpredictable factors, many of which are described in Zion's periodic reports filed with the SEC and are beyond Zion's control. These risks could cause Zion's actual performance to differ materially from the results predicted by these forward-looking statements. Zion can give no assurance that the expectations reflected in these statements will prove to be correct and assumes no responsibility to update these statements.
Contact Information
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Zion Oil & Gas Newsletter
Wednesday,
May 4, 2011
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Dear Zion Family and Friends,
I wanted to share with you a
recent article written about Zion Oil & Gas, Inc. and ask you all to please
continue to pray for Israel
(Isaiah 41:8-10) and the Ma'anit Joseph #3 well that we are currently
drilling in Israel. (Isaiah 45:3)
Shalom,
John Brown
"Then Israel sang this song: 'Spring up, O Well! All of you sing to it.'"
(Numbers 21:17)
Published on GlobalPost (http://www.globalpost.com)
Israel: The oil of Zion By Kevin Douglas Grant[2]May 3, 2011
Prophecy and science converge in Israel's oil and gas boom.
CAESAREA, Israel - John Brown first came to Israel in 1983 with visions of striking oil. He didn't care that geologists had written off that possibility as absurd.
Already a successful manufacturing executive, Brown was a recently born-again Christian when he boarded a flight for Jerusalem. The words of Christian evangelist Jim Spillman were fresh in his mind:
"The Bible tells us that God has left us petroleum in Israel."
"I read the scriptures and it seemed to be pretty clear to me that there was evidence of hydrocarbons in Israel," said Brown, who is now 71 years old.
Oil industry insiders mocked Brown for years, laughing that he had picked the only country in the Middle East without any oil.
It turned out, of course, that Brown was right all along.
Almost 30 years later, he is the founder of Texas-based, NASDAQ-traded Zion Oil and Gas. The company, founded in 2000, operates exploratory wells in Israel. Its stock price has been boosted by a string of discoveries beginning in 2009 that confirm some of what Brown had been saying from the start.
"Everybody accepts now that there are large deposits of hydrocarbons in and around Israel," said Richard Rinberg, an Orthodox Jew who has served as Zion's CEO since 2005. "And everybody's drawn to the area now - the hot money is coming in. The geology confirms the theology."
The United States Geological Survey announced last year that the Mediterranean waters off Israel's coast contain 1.7 billion barrels of extractable petroleum and 122 trillion cubic feet of natural gas - enough to radically transform Israel's geopolitical fortune this century. The country's longstanding desire for energy independence has only been accelerated by the recent instability in Egypt [3], which supplies 40 percent of Israel's natural gas.</s pan>
Zion Oil's board of directors, which includes a former Chevron executive and the chairman of the Railroad Commission of Texas, has attempted to balance their religious motivations with the exacting standards of business and science.
They all agree that central to their mission is helping Israel become more stable and energy independent.
"We're just a bunch of guys who really love Israel," Brown said.
"As in a great book, you can come at it from any direction you wish," said Rinberg, who moved his family to Israel from England in 1996. "John Brown came from Biblical understanding. To run a corporation in the 21st century, you need to do scientific investigation and use high-tech techniques."
But the company - which has the motto: "A special company ... A special task ... A special country" - is still waiting for its big find. Much larger companies, meanwhile, are enjoying huge success. The Texas-based multinational, Noble Energy, is preparing to extract trillions of cubic feet of natural gas from its recently discovered Tamar and Leviathan fields near Haifa.
Tamar alone is expected to meet Israel's own gas needs for at least three decades, while the much larger Leviathan could make Israel an exporter for the first time in its history as soon as next year. Tax revenues from the gas could amount to $500 million a year.
"Frankly the only thing we're missing is a discovery to announce," Rinberg said, expressing an optimism that's become one of Zion Oil's trademarks.
The state of affairs in Israel has changed drastically since 2003, when Rinberg first got involved in Zion as a venture capitalist.
"I found the idea of oil in Israel compelling on a number of levels, both business and spiritual," Rinberg said. "Before the Tamar discovery in January 2009, when I would tell people what I was doing, it was not uncommon for them to burst out laughing."
These days, several of Zion's competitors are laughing with delight. Just south of where Zion's drilling rights end, Jerusalem-based Givot Olam discovered one of the country's largest onshore oil fields, Meged, in 2004. Producing since last year, Meged contains an estimated 1.5 billion barrels of oil at the "Megged 5" well a few miles east of Tel Aviv.
"For many years we drilled wells without success," said Tuvia Luskin, Givot's founder. "Megged 5 is an event like the giving of the Torah."
If Brown is envious of Luskin's good fortune, he doesn't show it.
"He had the exact same scriptures I had," Brown said. "Now he's produced the oil and I think we're up next."
Zion focuses its operations along a stretch of land between Caesarea and Haifa in northern Israel. Brown selected it after reading the Spillman's 1981 tract, "The Great Treasure Hunt."
It prophesized huge quantities of petroleum under that land based on a passage from Deuteronomy, which reads: "Most blessed of sons be Asher. Let him be favored by his brothers and let him dip his foot in oil at the head of Joseph."
Brown said the scripture has guided him since he first visited Israel in 1983.
"I Iooked at a Biblical map, and it looked like there was an outline of a head," he said. "It was perfectly clear to me that was where the oil was. And that's where we are today."
Many Biblical scholars say the scripture doesn't reference petroleum at all, but rather olive oil, still abundantly produced in the region.
Brown is not very concerned about the distinction, even if Zion's decade-long endeavor has yet to produce any petroleum.
"There's no way I'm wavering," he said. "In evangelical jargon, what I am is a faith guy and I act on it."
Israel's natural resources inspire a religious fervor even among secular adherents, domestically and around the world.
"This is a national treasure," said Alon Ben-Meir, a professor at New York University and The New School, in reference to Israel's natural gas. "It belongs to the people, not to anyone else."
Israel, Lebanon, Palestine, Cyprus and Northern Cyprus can all lay claim to some of the natural gas within their respective maritime borders, which were never clearly defined. Israel is working with Cyprus but is locked in a bitter dispute with Lebanon [4], which is also banking on the newly-discovered gas fields to relieve its energy woes and pad government accounts.
"Lebanon is laying claim only now that great wealth has been discovered," Rinberg said. "Now that we've done the work, they say, 'Oh, you've stolen it from us.'"
In its ongoing quest, Zion Oil has begun operating one of the deepest exploratory wells on Israeli soil.
"People ask about Texas and the Middle East where you have loads of oil near the surface," Rinberg said. "In Israel, we believe the oil is a lot deeper."
Brown said he is enjoying the process of exploration and has no doubt that Zion will eventually meet with success.
"It was God's decision that we come here," Brown said. "If it were just economic, I wouldn't be here, I'd be in Texas where all the oil is. We're here to help Israel."
Contact Information
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Zion Oil & Gas Newsletter
Friday,
April 15, 2011
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Dear Shareholder and/or Friend of Zion...

I am pleased to advise you that the State of Israel has advised us that we will be granted a new license area on land that was previously within our (now expired) Issachar-Zebulun Permit area. The new license is termed by us the Jordan Valley License and we are excited to have received the grant of this new license area, as we believe that it holds great promise for petroleum exploration. You can read the full press release below.
The history of the new license area is, as follows. In August 2009, we were awarded a preliminary exclusive petroleum exploration permit on approximately 165,000 acres onshore Israel. The Issachar-Zebulun Permit allowed us to conduct, on an exclusive basis through February 23, 2011, preliminary investigations to ascertain the prospects for discovering petroleum in the area covered by the permit. Unlike a license area, where test drilling may take place, no test drilling is allowed on a permit area.
On February 17, 2011, prior to the expiration of the Issachar-Zebulun Permit, we submitted an application to the Petroleum Commissioner for an exploration license on approximately 87,000 acres of land - the Jordan Valley License Application. We have now been advised that our application for that exploration license has been granted and we anticipate receiving the formal license grant soon.
In my previous update to you on April 1, 2011, I noted that we were 'directionally' drilling the Ma'anit-Joseph #3 well (meaning that we were drilling at a slight angle to the vertical) and had reached a measured depth of 16,580 feet (5,053 meters). Zion's target depth for this well is approximately 19,360 feet (5,900 meters), so we had completed approximately 85% of the drilling.
I also commented that drilling at such great depths brings with it great technical challenges and that, as I wrote, we were having to work the stuck pipe loose, although we did have full mud circulation and rotary movement on the drilling bit.
Shortly after distributing the update, it appeared that the drilling bit became stuck in a layer of shale and then (as we later found out) that the drill pipe had sheared apart, due to torsion stress. We pulled the vast majority of the pipe out of the hole (as you can see in the photograph below) leaving a 'fish' in the hole of approximately 951 feet (290 meters) in length.
As we were not able torecover the 'fish' in an economical manner, we will start a new (#2) sidetrack wellbore (with adjusted mud weight, to deal with the shale we encountered).
Clearly, drilling at over 16,400 feet (approximately 5 kilometers) deep is not a simple or easy matter and, as drilling proceeds, we have lost a lot of sleep. But, although we may have lost a battle or two, I believe that we will win the war and reach our target of approximately 19,360 feet (5,900 meters).
I agree with the words of Winston Churchill, "Sure I am of this, that you have only to endure to conquer. This is no time for ease and comfort. It is time to dare and endure" and certainly with the words of Proverbs 3:5,6.
As I write, we are making final preparations to drill the new (#2) sidetrack
wellbore. As I noted in my previous update, I do believe that we have a team
with all of the necessary professional skills to meet the challenges of
drilling at such great depth.
In my next update to you, I will give you our new estimated time to reach
our target depth.
Here is this week's operational update:

The Ma'anit-Joseph #3 Wellsite
Drilling Operations at the Ma'anit-Joseph #3 Wellsite
On February 23, 2011, directional drilling operations began on the Ma'anit-Joseph #3 sidetrack well with a kick-off point at approximately 13,220 feet (4,030 meters).
In the previous well progress update, we reported reaching a measured drill depth of 16,580 feet (5,053 meters) and noted that we had drilled deeper (stratigraphically) than the depth achieved in the original vertical hole. This depth was confirmed (by bio-stratigraphic analysis) to contain rock of Lower Triassic age, implying that we could very soon be entering our target formations in Permian age rock.
When drilling through the Lower Triassic depths, we encountered a section of rock formation with a significant tendency to cave in to the wellbore. Possibly, this caving tendency is due to unusually strong sheer forces acting on the formation. The drill string became stuck in this layer of rock and our initial attempt to free the pipe was successful. However, in pulling the drill string out of the hole to inspect its condition, the pipe assembly again became stuck.
Despite several efforts to free the drilling assembly, it remained irretrievably stuck. Ultimately, the drill string parted deep in the hole, allowing us to retrieve all but the lowest portion of the drilling equipment.
Due to the directional geometry of the well and the location of equipment remaining in the hole, retrieving or fishing for this equipment was not economically feasible. So, the decision was made to immediately drill a second sidetrack well.
The second sidetrack well is projected to start at a depth approximately 1,000 feet (304 meters) lower than the first sidetrack well and will take advantage of the well design from the first sidetrack to minimize twists in the shape of the new well path. Also, the mud system will be further modified to address the previously unexpected sheer forces of the rock encountered in the Lower Triassic.
We are also incorporating "lessons learned" from other wells drilled through these rock formations. The nearest well to penetrate the Lower Triassic and older rock types, however, is a distance of approximately 34 miles (55 kilometers) away from the Ma'anit-Joseph #3 well, making geologic and operational correlations between the two wells highly uncertain.
Nevertheless, our target remains the Permian geological layer, at a projected true vertical depth of approximately 19,360 feet (5,900 meters) and we are making progress. Today, we are placing a cement plug in the bottom of the first sidetrack well and will soon "kick-off" (start drilling) the second sidetrack well.
"In your good pleasure, make Zion prosper..."
Psalm 51:18
Thank you for your support of Zion and Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.

FORWARD LOOKING STATEMENTS: Statements in this communication that are not historical fact, including statements regarding Zion's planned operations, anticipated attributes of geological strata being drilled, the presence or recoverability of hydrocarbons, the sufficiency of cash reserves, ability to raise additional capital, timing and potential results thereof and plans contingent thereon are forward-looking statements as defined in the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on assumptions that are subject to significant known and unknown risks, uncertainties and other unpredictable factors, many of which are described in Zion's periodic reports filed with the SEC and are beyond Zion's control. These risks could cause Zion's actual performance to differ materially from the results predicted by these forward-looking statements. Zion can give no assurance that the expectations reflected in these statements will prove to be correct and assumes no responsibility to update these statements.
Contact Information
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
More information about Zion is available at www.zionoil.com or by contacting
Mike Williams at:
Zion Oil & Gas, Inc.
6510 Abrams Rd., Suite 300, Dallas, TX 75231
telephone 1-214-221-4610 or 1-888-891-9466
email: dallas@zionoil.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Zion Oil & Gas to be Awarded
New Petroleum Exploration License Onshore Israel
Dallas, Texas and Caesarea, Israel - April 14, 2011 - Zion Oil & Gas, Inc. (NASDAQ GM: ZN) reported today that the Israeli Petroleum Commissioner's Office, on behalf of the State of Israel, has notified Zion that it will be awarded a new petroleum exploration license on land within Zion's previous (and now expired) Issachar-Zebulun Permit area. The new license has been named by Zion, the "Jordan Valley License". Zion expects to formally receive the license soon.
The Jordan Valley License area is to the east of Zion's Joseph license area and Zion's Asher-Menashe license area and to the south of the Sea of Galilee. It traverses south along the western Jordan River Valley.
Zion's Chief Executive Officer, Richard Rinberg, said today, "We are truly excited and very pleased that the State of Israel will award us our new Jordan Valley License. We continue to implement our exploration and drilling program and build on our progress to date. In 2011, we intend to acquire additional seismic and other geological and geophysical data in our new license area, as we endeavour to refine our potential drilling prospects in this area. Meanwhile the drilling operations at our Ma'anit-Joseph #3 well continue, as we strive for our primary target in deep Permian age rock, expected at a depth of over 19,000 feet (5,790 meters). The Ma'anit-Joseph #3 well is already one of the deepest wells ever drilled onshore Israel."
Zion's common stock trades on the NASDAQ Global Market under the symbol "ZN".
Zion Oil & Gas, a Delaware corporation, explores for oil and gas in Israel in areas located on-shore between Haifa and Tel Aviv. It currently holds two petroleum exploration licenses, the Joseph License and the Asher-Menashe License, between Netanya, in the south, and Haifa, in the north, covering a total of approximately 162,000 acres.
FORWARD LOOKING STATEMENTS: Statements in this press release that are not historical fact, including statements regarding Zion's planned operations, drilling efforts and potential results are forward-looking statements as defined in the "Safe Harbor" provision of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on assumptions that are subject to significant known and unknown risks, uncertainties and other unpredictable factors, many of which are described in Zion's periodic reports filed with the SEC and are beyond Zion's control. These risks could cause Zion's actual performance to differ materially from the results predicted by these forward-looking statements. Zion can give no assurance that the expectations reflected in these statements will prove to be correct and assumes no responsibility to update these statements.
Zion's homepage may be found at: www.zionoil.com
Contact:
Zion Oil &
Gas, Inc.
6510 Abrams Rd., Suite 300
Dallas, TX 75231
Mike Williams:
Telephone: 214-221-4610
Email:
dallas@zionoil.com
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March 18, 2011
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Dear Shareholder and/or Friend of Zion...

Since my previous update to you on March 4, 2011, we have been 'directionally' drilling the Ma'anit-Joseph #3 well (meaning that we are drilling at a slight angle to the vertical) and have now reached a measured depth of 15,030 feet (4,581 meters).
The Ma'anit-Joseph #3 well is already one of the deepest wells ever drilled onshore Israel. Almost certainly, stratigraphically (i.e. with regard to the age of the sedimentary rocks in the rock strata), in Northern Israel, no-one has ever drilled as deep as our current well has already been drilled.
You can read an operational update below. We plan to reach the Ma'anit-Joseph #3 well's target depth, in Permian age rock formations, in late April 2011, assuming no additional technical difficulties occur.
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Our reduced ZNWAW warrant exercise price program, which was in effect since January 3, 2011, expired on March 7, 2011, and the original exercise price of $7 has been reinstituted for all remaining unexercised warrants with the symbol ZNWAW. You can read full details of the outcome of our reduced ZNWAW warrant exercise price program in the press release that we issued on March 11, 2011. If you wish to read the press release, please click here.
Zion has the following securities in issue and trading on the NASDAQ Global Market stock exchange:
(a) common stock trading under the symbol "ZN".
(b) $7 warrants trading under the symbol "ZNWAW". These warrants will continue to be exercisable through January 31, 2012.
(c) $4 warrants trading under the symbol "ZNWAZ". These warrants will continue to be exercisable through December 31, 2012.
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On March 16, 2011, we filed our 2010 financial results with the U.S. Securities and Exchange Commission (the SEC). Zion's financials for the 2010 calendar year contain a tremendous amount of information regarding Zion, so you may wish to review them. If you do, please click here.
Here is this week's operational update:
The Ma'anit-Joseph #3 Wellsite
Drilling Operations at the Ma'anit-Joseph #3 Wellsite
On August 26, 2010, drilling operations began on the Ma'anit-Joseph #3 well, in our Joseph License area, onshore Northern Israel.
Since the previous update, we have been drilling ahead, directionally, and have made steady progress. We have been using a combination of both rotary and slide drilling as we drill through the 'build angle / drop angle' (or 'bend') portion of the well. The bend section of the well positions the drill bit away from the previously drilled vertical hole. Once we complete the bend section of the well, we will continue drilling a generally vertical hole to the target depth.
Slide drilling is when only the bit (not the full length of drill pipe) is rotated, powered by the downhole motor. Slide drilling is slower than traditional rotary drilling (when the full length of drill pipe and bit is rotated) but provides greater control when drilling through the bend section of a directional well.
Aside from testing our blow-out prevention equipment and routine drill bit changes, drilling has continued with minimal interruption since our last update. As of Friday, March 18, 2011, we have directionally drilled to a depth of 15,030 feet (4,581 meters) MD. When drilling a directional well, the reference to "MD" means Measured Depth or the total length of well drilled. This distinguishes from "TVD" which means True Vertical Depth or the equivalent depth of the well if drilled vertically. The current TVD of the well is 15,007 feet (4,574 meters). Our target in the Permian remains at a TVD of approximately 19,360 feet (5,900 meters).
"In your good pleasure, make Zion prosper..."
Psalm 51:18
Thank you for your support of Zion and Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
FORWARD LOOKING STATEMENTS: Statements in this communication that are not historical fact, including statements regarding Zion's planned operations, anticipated attributes of geological strata being drilled, the presence or recoverability of hydrocarbons, the sufficiency of cash reserves, ability to raise additional capital, timing and potential results thereof and plans contingent thereon are forward-looking statements as defined in the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on assumptions that are subject to significant known and unknown risks, uncertainties and other unpredictable factors, many of which are described in Zion's periodic reports filed with the SEC and are beyond Zion's control. These risks could cause Zion's actual performance to differ materially from the results predicted by these forward-looking statements. Zion can give no assurance that the expectations reflected in these statements will prove to be correct and assumes no responsibility to update these statements.
Contact Information
More information about Zion is available at www.zionoil.com
or by contacting Mike Williams at:
Zion Oil & Gas, Inc.
6510 Abrams Rd., Suite 300, Dallas, TX 75231
telephone 1-214-221-4610
email: dallas@zionoil.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
February 4, 2011
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Dear Shareholder and/or Friend of Zion
Since my previous update to you, during the past two weeks, Zion has made further notable progress.
We have now drilled the Ma'anit-Joseph #3 well to approximately 16,430 feet and are continuing to drill deeper, as you can read below. If you place eleven Empire State Buildings on top of each other, you will reach, almost exactly, a height of 16,000 feet.
The Ma'anit-Joseph #3 well is already one of the deepest wells ever drilled onshore Israel. Our Exploration Manager, Stephen Pierce, advises that, almost certainly, stratigraphically (i.e. with regard to the age of the sedimentary rocks in the rock strata), in Northern Israel, no-one has ever drilled as deep as our current well has already been drilled.
We believe that, as early as next week, we
may begin to approach the Permian geological layer; although we currently
project that we won't reach the well's target depth until approximately
mid-March 2011.
I am pleased to report that Victor Carrillo (who
joined Zion's Board of Directors in September 2010)
has recently joined Zion's full time management staff as Executive Vice
President.
To read the full press release, please
click here.
Left to Right: Victor Carrillo and Richard Rinberg (CEO)
Victor is a petroleum geologist and
geophysicist and has over twenty years of experience in the oil and gas
industry.
Until December 2010, he was
Chairman of the Texas Railroad Commission (the agency that oversees the oil
and gas,
pipeline and surface mining
industries in Texas).

Meeting with
Israel's Petroleum Commissioner, in Jerusalem.
Left to
Right: Bill Ottaviani, Victor Carrillo, John Brown and Commissioner Dr.
Ya'acov Mimran
On Wednesday, January 26, 2011, John Brown (Zion's Founder and Chairman of the Board), Richard Rinberg (CEO), Bill Ottaviani (President and COO) and Victor Carrillo (Zion's new Executive Vice President) met with Israel's Oil & Gas Commissioner, Dr. Ya'acov Mimran, and his team, at the Commissioner's office in Jerusalem. We updated the Commissioner on our recent operations and discussed Zion's future plans.
Turning to financial matters, on January 3,
2011, we issued a press release concerning our ZNWAW warrants.
To read the full press release, please
click here.
If you hold ZNWAW warrants, you should carefully review both the press release and my comments below.
Finally, here is this week's operational update:
The Ma'anit-Joseph #3 Wellsite (on January 25, 2011)
Drilling Operations at the Ma'anit-Joseph #3 Wellsite
On August 26, 2010, drilling operations began on the Ma'anit-Joseph #3 well, in our Joseph License area, onshore Northern Israel.
Following full recovery of the logging tool, as noted in our last update, normal well operations resumed. In the past two weeks, the cement bond integrity of the recently installed 7" casing was successfully tested and, as of February 4, drilling of the 6-1/8" hole has reached approximately 5,008 meters (16,430 feet).
Our ultimate target depth is approximately 5,900 meters (19,350 feet).
As we drill deeper, we continue to collect rock samples, circulated to the surface after being cut by the drill bit. These samples are analyzed for biologic markers (e.g. microscopic fossils) that are used to determine the type of geologic formation being drilled.
Our geologists note that at our present drilled depth we appear to be in the lower Triassic formation as expected. Of significance, just below the Triassic lies the Permian formation, which is our primary objective for this well.
Opportunity regarding Zion Warrants with the trading symbol: ZNWAW
In January 2009, Zion completed a follow-on offering and issued approximately 666,000 warrants with a $7.00 exercise price.
In order to be fair to all of Zion's investors, raise significant additional working capital for Zion's exploration and development activity in Israel and simplify our capital structure, we have temporarily reduced the exercise price of the warrants trading under the symbol ZNWAW to $4.00 (from the $7.00 exercise price provided by the original terms of the Warrants).
The reduced exercise price applies to all of Zion's currently outstanding Warrants that trade under the symbol ZNWAW.
The $4.00 exercise price on ZNWAW warrants
will be available until 5:00 p.m. Eastern Time on March 7, 2011,
but please note that after March 7, 2011 and through January 31, 2012, the
scheduled expiration date of the ZNWAW warrants,
the ZNWAW warrants will be exercisable at the original exercise price of
$7.00 per warrant, after which date they will expire with no value.
You can find details regarding the offer on Zion's website. Please click here.
If you hold the ZNWAW warrants, please consider this opportunity.
"In your good pleasure, make Zion
prosper..."
Psalm 51:18
Thank you for your support of Zion and Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
FORWARD LOOKING STATEMENTS: Statements in this communication that are not historical fact, including statements regarding Zion's planned operations, anticipated attributes of geological strata being drilled, the presence or recoverability of hydrocarbons, the sufficiency of cash reserves, ability to raise additional capital, timing and potential results thereof and plans contingent thereon are forward-looking statements as defined in the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on assumptions that are subject to significant known and unknown risks, uncertainties and other unpredictable factors, many of which are described in Zion's periodic reports filed with the SEC and are beyond Zion's control. These risks could cause Zion's actual performance to differ materially from the results predicted by these forward-looking statements. Zion can give no assurance that the expectations reflected in these statements will prove to be correct and assumes no responsibility to update these statements.
NOTICE: Zion Oil & Gas, Inc. has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about Zion Oil & Gas and its offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, Zion Oil & Gas will send you the prospectus if you request it by calling toll free 1-888-TX1-ZION begin_of_the_skype_highlighting 1-888-TX1-ZION end_of_the_skype_highlighting (1-888-891-9466 begin_of_the_skype_highlighting 1-888-891-9466 end_of_the_skype_highlighting).
Contact Information
More information about Zion is available
at
www.zionoil.com
or by contacting Mike Williams at: Zion
Oil & Gas, Inc.
6510 Abrams Rd., Suite 300, Dallas, TX 75231
Telephone
1-214-221-4610
email: dallas@zionoil.com
To: All my fellow Christian Zionists in the Faith of our Father Abraham (Romans 4:11-13)
I am beginning my 30th year of faithfully following God's Vision (Habakkuk 2:2, 3) in what I believe is to find the oil of Israel, thereby fulfilling the prophecies and blessings of both Jacob (Genesis 49:1, 22-26) and Moses (Deuteronomy 33:1, 13-16).
The first one, I believe, is the discovery
of oil in the biblical land of Ephraim by Givot Olam, which was founded by
Tovia Luskin. Tovia told me over 25 years ago in Houston that he founded
Givot Olam based on the same scriptures
that I was given, in Deuteronomy 33: 13-16 and that Rabbi Mendel Schneerson
has blessed him and said that he would someday discover oil in Israel, which
I believe has now happened!!
Also I believe the second one is Noble Energy's recent offshore gas discovery. When I was led to write Zion's Vision in the early 80's, the prayer that I prayed and the scriptures that were given to me can be found in the book that God recently told me to write (Jeremiah 30:2) and if you will look in this book "The Oil of Israel, Prophecy being Fulfilled" on pages 31 - 33. On page 32 it says, "Three...the evidence" and then I quoted Isaiah 60:5, which, I believe, is what Noble Energy has discovered, "Then thou shalt see, and flow together, and thine heart shall fear, and be enlarged; because the abundance of the sea shall be converted unto thee, the forces of the Ġĕn'tīles shall come unto thee". While we still wait "By Faith" (2 Corinthians 5:7) for Deuteronomy 33:13-16 and verse 24 to be fulfilled on the head of Joseph, I take comfort that both Rabbi Yittzhak Swartz on April 3, 2005 blessed Zion and read this scripture in Deuteronomy 33:19 and again on September 26, 2005, Rabbi Eliezer Berland asked me to come to Jerusalem where he also blessed Zion (see pages 11 and 12 in The Oil of Israel, book). He also requested that I visit him again in 2006 in Jerusalem, which I did during the week of January 14th, 2006 and then he blessed Zion again and read this scripture to Richard and myself from Zechariah 4:6 and admonished us to continue "By Faith" to pursue the Vision for the Oil of Israel and in fact said, "that we had to drill deeper on the Joseph License" (Gen. 49:25) (Deut. 33:13)which is exactly what we are trying to do now on the Ma'anit Joseph #3 Well.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Dear Shareholder and/or Friend of Zion
This past week, the CEO of (international financial conglomerate) Citigroup, Vikram Pandit, visited Israel and met with Prime Minister Benjamin Netanyahu.
Pandit commented: "We feel that Israel has huge growth opportunities, and we are here to be a part of this."
He also expressed great enthusiasm for the oil and gas industry in Israel and said:
"The oil and gas wells being drilled in Israel are a great story, because they offer the possibility that Israel will generate exactly the right kind of growth, and enable Israel to be an even bigger exporter."
He said that Citigroup hoped to finance some of the investment in oil and gas and declared:
"We want to be part of the growth in Israel. There's nothing we would like better than to be part of fascinating projects of this kind."
We certainly agree with Mr. Pandit and were happy to see him visit Israel and comment on the oil and gas opportunity here.
With regard to financing the drilling of oil and gas operations, Zion's Rights Offering will, almost certainly, terminate on Wednesday, December 15, 2010, so if you wish to participate in the offering, please do so without delay.
Here is this week's operational update:
Drilling Operations at the Ma'anit-Joseph #3 Wellsite
The drilling rig at dawn at the Ma'anit-Joseph #3 wellsite
During the past several weeks, we have been steadily drilling an 8-1/2" hole. Aside from routine bit changes due to normal wear and testing of the blow out prevention (BOP) equipment, drilling has been proceeding without interruption.
As of Friday, December 10, we have achieved a depth of approximately 3,782 meters (12,408 feet). We will continue to drill an 8-1/2" hole to an approximate depth of 4,380 meters (14,370 feet) at which point we will obtain the next set of open-hole logs and set the next casing string.
Rights Offering
Our
stockholders have already subscribed to purchase approximately 3,400,000
Units of Zion's securities from the approximately 3,800,000 Units available
under the offering. In other words, our stockholders have already subscribed
to purchase approximately 90% of the Units available in the rights offering.
As I noted in our press release of November 19th, in order to be fair to all and allow every qualifying stockholder, whatever the size of their holding, the chance to exercise their rights, we decided to extend the rights offering to 5:00 p.m. Eastern Standard time on December 15, 2010. For many reasons, it is highly unlikely that we will extend beyond December 15th.
You may wish to review the Frequently Asked Questions (FAQs) relating to the rights offering on our website at: www.zionoil.com/investor-center
If you have a query, please call Zion's office (toll free): 1-888-TX1-ZION or 1-888-891-9466
"In your good pleasure, make Zion prosper..."
Psalm 51:18
Thank you for your support of Zion and Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
FORWARD LOOKING STATEMENTS: Statements in this communication that are not historical fact, including statements regarding Zion's planned operations, anticipated attributes of geological strata being drilled, the presence or recoverability of hydrocarbons, the sufficiency of cash reserves, ability to raise additional capital, timing and potential results thereof and plans contingent thereon are forward-looking statements as defined in the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on assumptions that are subject to significant known and unknown risks, uncertainties and other unpredictable factors, many of which are described in Zion's periodic reports filed with the SEC and are beyond Zion's control. These risks could cause Zion's actual performance to differ materially from the results predicted by these forward-looking statements. Zion can give no assurance that the expectations reflected in these statements will prove to be correct and assumes no responsibility to update these statements.
NOTICE:
Zion Oil & Gas, Inc. has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about Zion Oil & Gas and its offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, Zion Oil & Gas will send you the prospectus if you request it by calling toll free 1-888-TX1-ZION or 1-888-891-9466.
Contact InformationMore information about Zion is available at
www.zionoil.com or
Zion Oil & Gas, Inc. 6510 Abrams Rd., Suite 300, Dallas, TX 75231
telephone 1-214-221-4610; email:
dallas@zionoil.com ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
December 3, 2010
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~Dear Shareholder and/or Friend of Zion

Zion's CEO, Richard Rinberg, at the Knesset on Tuesday, November 30, 2010
This past week, representing Zion Oil & Gas, I visited the Knesset to attend a meeting of the Economic Affairs Committee. There was a presentation by Noble Energy regarding their Tamar gas discovery, offshore Israel. There is much discussion in Israel regarding royalties and taxation as applied to the oil and gas industry and, of course, there are opposing sides.
The government would
like a larger share of the economic pie resulting from any oil or gas finds
and those in the
oil and gas industry would prefer the current situation to remain unchanged,
so that multi-year projects
can be planned and properly assessed for economic viability. The current
uncertainty does not help
either side, so we hope that the royalty and taxation issue will be resolved
without too much delay.
Also present at the
Knesset Economic Affairs Committee meeting was an Israeli company drilling
onshore Israel,
but to the south of Zion's exploration areas. Just this week, they issued an
estimate, based on two reports
(by international firms Baker-Hughes and Greensand), of the amount of oil
that they claim to have
discovered onshore Israel. They reported that have had already sold 6,000
barrels of oil, claim proven
reserves of 2.2 million barrels of oil and possible reserves of up to 56
million barrels of oil in their field.
At Zion Oil, with world
class discoveries of gas offshore and now a recent credible discovery of oil
onshore Israel,
we are eager to reach the drilling targets of our current well. As you can
read below, we are drilling at a
depth of 3,482 meters (11,424 feet) and believe that we are now drilling
within our secondary target (the Triassic).
To confirm our belief, we are collecting samples for biostratigraphic
testing. However, our primary target is the
Permian and, at our present rate of drilling, we should reach Permian
lithology (i.e. Permian age rocks) early in 2011.
The Geophysical Institute of Israel team visit the Ma'anit-Joseph #3 well
On Wednesday, December
1, 2010, a team from the Geophysical Institute of Israel (GII)
visited our Ma'anit-Joseph #3 drill site. Having gathered seismic data for
us,
they were interested to learn how our drilling was proceeding and view our
operations.
In order to update you, here is this week's operational update
Drilling Operations at the Ma'anit-Joseph #3 Wellsite
The drilling rig at the Ma'anit-Joseph #3 wellsite on December 1, 2010
On August 26, 2010,
drilling operations began on the Ma'anit-Joseph #3
well, in our Joseph
License area, onshore Northern Israel.
During the past several
weeks, we have been steadily drilling an 8-1/2" hole.
Aside from routine
bit changes due to normal wear and testing of the blow out prevention
(BOP)
equipment, drilling has been proceeding without interruption.
As of Friday December 3,
we have achieved a depth of approximately 3,482 meters (11,424 feet).
We
will continue to drill an 8-1/2" hole to an approximate depth of 4,380
meters (14,370 feet) at
which point we will obtain the next set of open-hole
logs and set the next
Rights Offering
Our stockholders have
already subscribed to purchase approximately 3,370,000 Units of Zion's
securities from the approximately 3,800,000 Units available under the
offering. In other words, our stockholders have already subscribed to
purchase almost 90% of the Units available in the rights offering.
As I noted in our press release of November 19th, in order to be fair to all and allow every qualifying stockholder, whatever the size of their holding, the chance to exercise their rights, we decided to extend the rights offering to 5:00 p.m. Eastern Standard time on December 15, 2010. For many reasons, it is highly unlikely that we will extend beyond December 15th.
If you have a query, please call Zion's office (toll free): 1-888-TX1-ZION or 1-888-891-9466
Chanukah
On Wednesday night,
December 1st, the festival of Chanukah arrived. The festival, also known as
the
Festival of Lights, is an eight-day Jewish holiday commemorating the
rededication of the Second Temple in
Jerusalem, at the time of the Maccabean Revolt of the 2nd century BCE.
Chanukah also commemorates the "miracle of the oil". At the re-dedication following the victory of the Maccabees over the Seleucid Empire, there was only enough consecrated oil to fuel the eternal flame in the Temple for one day. However, miraculously, the oil burned for eight days, which was the length of time it took to press, prepare and consecrate fresh oil.
The festival is observed by the kindling of the lights of a Menorah - one additional light on each night of the holiday.
As you can see from the
photograph at the top of this update (taken at an inner courtyard of the
Knesset)
the Menorah, symbolizing 'light' is an important symbol of Israel.
Of course, at Zion, all of us are
praying for a current day 'miracle of the oil'...
In the spirit of Chanukah, at the request of Zion's Founder and Chairman of the Board, John Brown, Zion's office staff in Dallas will have Rabbi Zakon stopping by to teach about this Jewish holiday. There will be gifts of Menorahs, Candles and Draydels (spinning tops) with chocolate coins inside, for both staff and guests.
"In your good pleasure, make Zion prosper..."
Psalm 51:18
Thank you for your support of Zion and Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
FORWARD LOOKING STATEMENTS:
Statements in this communication that are not historical fact, including statements regarding Zion's planned operations, anticipated attributes of geological strata being drilled, the presence or recoverability of hydrocarbons, the sufficiency of cash reserves, ability to raise additional capital, timing and potential results thereof and plans contingent thereon are forward-looking statements as defined in the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on assumptions that are subject to significant known and unknown risks, uncertainties and other unpredictable factors, many of which are described in Zion's periodic reports filed with the SEC and are beyond Zion's control. These risks could cause Zion's actual performance to differ materially from the results predicted by these forward-looking statements. Zion can give no assurance that the expectations reflected in these statements will prove to be correct and assumes no responsibility to update these statements.
NOTICE:
Zion
Oil & Gas, Inc. has filed a registration statement (including a prospectus)
with the SEC for the offering to which this communication relates. Before
you invest, you should read the prospectus in that registration statement
and other documents the issuer has filed with the SEC for more complete
information about Zion Oil & Gas and its offering. You may get these
documents for free by visiting EDGAR on the SEC website at www.sec.gov.
Alternatively, Zion Oil & Gas will send you the prospectus if you request it
by calling toll free 1-888-TX1-ZION or 1-888-891-9466.
Contact Information
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Dear Shareholder and/or Friend of Zion...
November 26, 2010

Zion Oil & Gas Further Extends Subscription Period
for Rights Offering to December 15,
2010
As you can read in the Press Release (see
below), Zion has further extended the subscription period
for its current rights offering to
December 15, 2010.
The original scheduled expiration date of the rights offering was November 15, 2010. By 5:00 p.m. Eastern Standard time on that date Zion stockholders had subscribed to purchase approximately 3,192,000 Units of Zion's securities of the approximately 3,800,000 Units available under the offering.
However, we were advised that some
qualified holders of Zion's common stock wished to make a further
subscription, so we decided to extend the duration of the offering by three
days to November 18, 2010.
During the three day extension, a number of qualified holders contacted the Company commenting that their brokerage house had either not notified them of the Company's rights offering and/or not forwarded rights offering documentation to them in a timely manner.
In order to be fair and allow all qualified holders, whatever the size of their holding, to exercise their right to subscribe, we decided to further extend the duration of the offering. The rights may now be exercised at any time prior to 5:00 p.m. Eastern Standard time on December 15, 2010, the new scheduled expiration of the offer.
Please note, in the event that the rights
offering becomes oversubscribed,
we would have to scale down the oversubscriptions.
You may also be interested to learn that, the drilling of our current exploration well, the Ma'anit-Joseph # 3 well, has reached a depth of approximately 9,055 feet (2,760 meters) towards the secondary target, Triassic age lithology, expected below approximately 10,827 feet (3,300 meters). We then plan to continue drilling to the primary target, Permian age lithology, down to a planned total depth below approximately 19,357 feet (5,900 meters).
I am deeply appreciative of the support shown by our stockholders and look forward to making 2011 a banner year for Zion as we move forward with our work to find and recover hydrocarbons onshore Israel.
Thank you for your continued support of Zion, and
Richard Rinberg
PRESS RELEASE - November 19, 2010
Zion Oil & Gas Further Extends Subscription Period for Rights Offering
DALLAS and CAESAREA, Israel, Nov. 19, 2010
-- Zion Oil & Gas, Inc. (Nasdaq: ZN)
announced today that it has extended the expiration date for its pending
rights offering to December 15, 2010.
The original scheduled expiration date of
the rights offering was November 15, 2010.
By that date Zion stockholders had subscribed to purchase approximately
3,192,000 Units of Zion's securities
from the approximately 3,800,000 Units available under the offering.
As the rights offering was not fully
subscribed by November 15, 2010, and the Company was advised that
some qualified holders of its common stock wished to make a further
subscription, the Company decided to
extend the duration of the offering by three days to November 18, 2010.
During the three day extension, a number of
qualified holders contacted the Company commenting that
their brokerage house had either not notified them of the Company's rights
offering and/or not forwarded
rights offering documentation to them in a timely manner.
In order to allow all qualified holders to
exercise their right to subscribe, the Company has decided to further
extend the duration of the offering. The rights may now be exercised at any
time prior to 5:00 p.m. Eastern Standard
time on December 15, 2010, the new scheduled expiration of the offer.
Zion's Chief Executive Officer, Richard Rinberg, said today, "In order to be fair to all and allow every qualifying stockholder, whatever the size of their holding, the chance to exercise their rights, we decided to extend the rights offering.
The drilling of our current exploration
well, the Ma'anit-Joseph # 3 well, has reached a depth of approximately
9,022 feet (2,750 meters) towards the secondary target, Triassic age
lithology, expected below approximately
10,827 feet (3,300 meters). We then plan to continue drilling to the primary
target, Permian age lithology, down
to a planned total depth below approximately 19,357 feet (5,900 meters).
We remain excited about the possibility of
recovering hydrocarbons on our license and permit areas, onshore Israel,
especially due to the U.S. Geological Survey report, published in April
2010, containing their assessment that there
may be 1.7 billion barrels of recoverable oil and 122 trillion cubic feet of
recoverable gas in the Levant Basin,
as all of Zion's exploration rights fall within the area of the Levant
Basin."
Under the terms of the rights offering, the
Company distributed at no charge to the holders of its common stock as of
September 28, 2010, non-transferable subscription rights to purchase their
pro rata portion of approximately 3,800,000
Units of Zion's securities. Each Unit consists of one (1) share of Zion's
common stock and one (1) warrant to
purchase an additional share of Zion's common stock at an exercise price of
$4.00.
Under the rights offering, stockholders of
record on the record date have the right to subscribe for eighteen
(18) Units for every one hundred (100) shares of common stock owned on the
record date, equivalent to 0.18
subscription rights for each share of common stock owned on the record date.
Each whole subscription right entitles the
stockholders of record on the record date to subscribe for one Unit at the
per Unit purchase price of $5.00.The warrant will be exercisable for a
two-year period beginning on the closing date
after the rights offering expires.
Other than the extension of the expiration date of the rights offering, the offering terms described in Zion's Prospectus Supplement dated September 29, 2010, remain unchanged and apply during the extended period of the offering. Zion reserves the right to further extend the expiration date, though it has no current intention of doing so.
Zion's common stock trades on the NASDAQ Global Market under the symbol "ZN" and Zion's public warrants trade under the symbol "ZNWAW". The warrants from our current offering will trade under the symbol "ZNWAZ" once issued.
This announcement is neither an offer nor a
solicitation of any offer. The securities are offered by prospectus only,
and only within those States and other jurisdictions in which the securities
may be sold, and this announcement is
neither an offer to sell nor a solicitation of any offer to buy in any state
or jurisdiction in which such offer, solicitation
or sale would be unlawful prior to the registration or qualification under
the securities of any such state or jurisdiction.
Zion Oil & Gas, a Delaware corporation, explores for oil and gas in Israel in areas located on-shore between Haifa and Tel Aviv. It currently holds two petroleum exploration licenses, the Joseph and the Asher-Menashe Licenses, between Netanya, in the south, and Haifa, in the north, covering a total of approximately 162,000 acres and the Issachar-Zebulun Permit Area, adjacent to and to the east of Zion's Asher-Menashe license area, covering approximately 165,000 acres. Zion's total petroleum exploration rights area is approximately 327,000 acres.
FORWARD-LOOKING STATEMENTS: Statements in this press release that are not historical fact, including statements regarding Zion's planned operations, drilling efforts, proceeds of the rights offering, the successful establishment of the drilling subsidiary and the negotiation and execution of definitive agreements with Aladdin Middle East Ltd. (the current owner of the drilling rig) with respect thereto and potential results thereof and plans contingent thereon and the final gross proceeds of the rights offering, are forward-looking statements as defined in the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on assumptions that are subject to significant known and unknown risks, uncertainties and other unpredictable factors, many of which are described in Zion's periodic reports filed with the SEC and are beyond Zion's control. These risks could cause Zion's actual performance to differ materially from the results predicted by these forward-looking statements. Zion can give no assurance that the expectations reflected in these statements will prove to be correct and assumes no responsibility to update these statements.
NOTICE: Zion Oil & Gas, Inc. has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about Zion Oil & Gas and its offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, Zion Oil & Gas will send you the prospectus if you request it by calling toll free 1-888-TX1-ZION (1-888-891-9466).
Zion's homepage may be found at: www.zionoil.com
Contact Information
More information
about Zion is available at
www.zionoil.com or by contacting Mike Williams at Zion Oil & Gas, Inc.
6510 Abrams Rd., Suite 300, Dallas, TX 75231;
telephone 1-214-221-4610; email: dallas@zionoil.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Dear Shareholder and/or Friend of Zion
This past week, John Brown (Zion's Founder and Chairman) and Victor Carrillo (a Zion Board member, who is also Chairman of the Railroad Commission of Texas) flew in from Dallas to visit Israel.
On Monday, November 8, 2010, John Brown, Victor Carrillo, Bill Ottaviani (Zion's President and Chief Operating Officer) and I attended a meeting at Israel's Ministry of National Infrastructures with Israel's Petroleum Commissioner, Dr. Ya'acov Mimran.
We discussed a number of issues relating to Zion's work in Israel, including our current drilling operations and our future plans to apply for a license for the area currently covered by our Issachar-Zebulun permit. A license would allow us to implement test drilling whereas no test drilling is allowed on a permit area.
As you can see in the following photographs, the meeting was held in a warm, friendly, and open atmosphere.

Left to Right: Dr.
Charlie Druckman (Zion Board member and Israel's former Petroleum
Commissioner),
Bill Ottaviani, Victor Carrillo, Dr. Ya'acov Mimran, John Brown, Dr. Victor
Bariudin
(Senior Coordinator Oil & Gas Production at Ministry of National
Infrastructures)

Left to Right: Victor Carrillo shows Dr. Ya'acov Mimran a map detailing
the gas pipeline infrastructure in Texas.
(The total pipeline miles in Texas is ~ 282,000 miles. By contrast, Israel
is
approximately 290 miles in length and 85 miles in width at its widest
point.)

Left to Right:
Richard Rinberg (Zion's CEO), Victor Carrillo, John Brown,
Dr. Ya'acov Mimran and Bill Ottaviani

Left to Right: Ali
Isinak (Drilling Engineer), John Brown, Victor Carrillo,
Rasim Yoruk (Well Manager), Danny Weisman (Foreman) at the Ma'anit-Joseph #3
wellsite.
Drilling Operations at the Ma'anit-Joseph #3 Wellsite

The drilling rig at the Ma'anit-Joseph #3 wellsite
On August 26, 2010, drilling operations began on the Ma'anit-Joseph #3 well, in our Joseph License area, onshore Northern Israel.
During the past week, we tested the integrity and quality of the cementing operation performed on the most recent string of casing (9-5/8" diameter) run in the hole.
All of our testing indicated that we had a proper cement bond and were 'good to go' with continuous drilling of our next hole interval.
Having a proper cement bond between the casing and rock wall of the hole is a critical requirement from both a safety and environmental protection standpoint.
Following the successful testing of our recent cementing operation, we began continuous drilling of the next hole section.
As of Thursday November 11, we are drilling an 8-1/2" hole to the depth of approximately 2,500 meters (8,200 feet).
This next section will be drilled to approximately 4,380 meters (14,370 feet) and will take us into rock of Middle Triassic age. While our ultimate target is the deeper rock layers of Permian age, it is possible that we may begin to see evidence of hydrocarbons (oil or gas) as we drill this next section of the hole through the Triassic.
Rights Offering
As I mentioned last week:
(i) Zion's rights offering is scheduled to expire next week, on Monday, November 15, 2010.
(ii) Even when opportunity knocks... a person still has to get up and open the door
If you were
a stockholder on the record date of September 28, 2010,
it is still not too late for you to exercise your rights in Zion's Rights
Offering, but it soon will be.
We have mailed to all eligible stockholders a copy of the prospectus supplement which was filed with the SEC on September 29, 2010, subscription materials and other items necessary for exercising the rights. Shareholders who hold their shares in a bank or broker name should have received the rights offering material from their bank or broker.
Under the rights offering, Zion has distributed (at no cost to stockholders) non-transferable subscription rights to holders of Zion's common stock on the close of business on the record date of September 28, 2010, to purchase their pro rata portion of approximately 3.8 million Units of Zion's securities Unit at a purchase price of $5.00 per Unit.
ONE UNIT = ONE SHARE (of Zion's common stock) + ONE WARRANT
The Warrant will allow the purchase of an additional share of Zion's common stock at an exercise price of $4.00 and will be exercisable for a two year period beginning after the offering expires.
You may wish to review the Frequently Asked Questions (FAQs) relating to the rights offering on our website at: www.zionoil.com/investor-center
If you wish to participate in Zion's Rights Offering, please do so without delay.
If you have a query, please call Zion's office (toll free): 1-888-TX1-ZION = 1-888-891-9466
"In your good pleasure, make Zion prosper..."
Psalm 51:18
Thank you for your support of Zion and Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
www.zionoil.com
FORWARD LOOKING STATEMENTS: Statements in this communication that are not historical fact, including statements regarding Zion's planned operations, anticipated attributes of geological strata being drilled, the presence or recoverability of hydrocarbons, the sufficiency of cash reserves, ability to raise additional capital, the successful establishment of the drilling subsidiary and the negotiation and execution of definitive agreements with the current owner of the drilling rig with respect thereto, timing and potential results thereof and plans contingent thereon are forward-looking statements as defined in the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on assumptions that are subject to significant known and unknown risks, uncertainties and other unpredictable factors, many of which are described in Zion's periodic reports filed with the SEC and are beyond Zion's control. These risks could cause Zion's actual performance to differ materially from the results predicted by these forward-looking statements. Zion can give no assurance that the expectations reflected in these statements will prove to be correct and assumes no responsibility to update these statements
.
NOTICE:
Zion Oil & Gas, Inc. has
filed a registration statement (including a prospectus) with the SEC for the
offering to which this communication relates. Before you invest, you should
read the prospectus in that registration statement and other documents the
issuer has filed with the SEC for more complete information about Zion Oil &
Gas and its offering.
You may get these documents for free by visiting EDGAR on the SEC website at
www.sec.gov.
Alternatively, Zion Oil & Gas will send you the prospectus if you request it
by calling
toll free 1-888-TX1-ZION (1-888-891-9466)
More
information about Zion is available at www.zionoil.com or by contacting
Mike Williams at Zion Oil & Gas, Inc.
6510 Abrams Rd., Suite 300, Dallas, TX 75231; telephone 1-214-221-4610;
email: dallas@zionoil.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
October 29, 2010
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~Dear Shareholder and/or Friend of Zion
Since my last update to you at on October 15th, we have been in continuous drilling operations at our Ma'anit-Joseph #3 wellsite and have made good progress. As you can read below, we are currently at a depth of 2,210 meters (7,251 feet) and preparing to run open hole logs and the next casing string in the hole.
Visit by the Ministry of National Infrastructures to Zion's Ma'anit-Joseph #3 wellsite
Dr.
Victor Bariudin (Senior Coordinator Oil & Gas Production at Ministry of
National Infrastructures) v
isits the Ma'anit-Joseph #3 wellsite on October 25, 2010.
Dr. Victor Bariudin is shown center of the photo and Richard Rinberg (Zion Oil's CEO) is on the right.
Dr. Bariudin was
very interested in 'safety matters' and especially the Blow Out Preventer
(BOP) system.
Our Wellsite Manager, Rasim Yoruk, gave a full report and explanation
regarding our safety procedures
and Dr. Bariudin commented that our systems looked "very good, indeed".
Zion's "Issachar-Zebulun Permit" - The Preliminary Results of the recent Seismic Acquisition
In August 2009, Zion was awarded an exclusive petroleum exploration permit (named by us, the "Issachar-Zebulun Permit") on approximately 165,000 acres onshore Israel.
The Permit area is adjacent to and to the east of our Asher-Menashe License and is in the area that was formerly within Issachar's and Zebulun's ancient biblical tribal areas.
A permit allows us to conduct, on an exclusive basis, preliminary investigations to ascertain the prospects for discovering petroleum in the area covered by the permit. Unlike a license area, where test drilling may take place, no test drilling is allowed on a permit area.
After some initial investigations by our geologists, in May 2010, we contracted with the Geophysical Institute of Israel (GII) to acquire approximately 29 kilometers of field seismic on our Issachar-Zebulun Permit. Please refer to our press release of May 25th and previous updates to you for the details.
In June 2010, field acquisition of the seismic was successfully completed and since then, we have been processing and interpreting the collected data for use in our proprietary geologic model of the area.
Although the processing and interpretation is ongoing, we do have some very early results and conclusions, as follows:
(i) We have identified some 'interesting' geologic structures and consequently do have new geologic "leads".
(ii) In order to validate the "leads" and, hopefully, upgrade them to drilling "prospects", we will need to investigate the five criteria of a petroleum system: Source, Reservoir, Seal, Migration and Trap.
(iii) This validation process of the newly discovered geologic leads
may require the acquisition
of additional seismic and other geologic data.
So, at this early stage, we are progressing well with our work on
this permit area and look forward to further work,
so that, hopefully, we can define one or more drilling prospects on
this area and apply for a license for the area currently covered by
the permit. You may be interested to know that the Hebrew name "Issachar"
almost certainly derives from the two Hebrew words: "Yesh Sachar",
which in English means: "There is a reward"...
Or if you prefer, as it says in Deuteronomy 33:19:
"They will summon peoples to the mountain and there offer sacrifices of righteousness;
they will feast on the abundance of the seas, on the treasures hidden in the sand."
On August 26, 2010, drilling operations began on the Ma'anit-Joseph
#3 well, in our
Joseph License area, onshore Northern Israel.
We are now preparing to run our next set of open hole correlation
logs, set and cement 9-5/8" casing,
and then begin drilling our longest section of the hole which will
be drilled with an 8-1/2" bit.
This next section of the well will be drilled to approximately 4,380
meters (14,370 feet)
which we anticipate should put us into rock layers of the Middle
Triassic age.
The final drilling leg will then be a 6-1/8" hole that is planned to
take us into the Permian zone,
which is our ultimate target for this well.
As we continue drilling operations in the upper section of the hole, we are already making preparations for production testing our target Permian zone in the first quarter of 2011. To this end, we are working with several companies in preparing test procedures and identifying needed equipment & services for this work.
We are currently behind our original drilling schedule, due
primarily to the fishing incident described in the last report.
We continue to look for opportunities to make up the lost time, but
not at the expense of well quality and
always keeping "safety" as a top priority.
Rights Offering
As you may know, Zion is holding a Rights Offering for every stockholder who held Zion stock on September 28, 2010.
We have mailed to all eligible stockholders a copy of the prospectus
supplement which was filed with the SEC on September 29, 2010,
subscription materials and other items necessary for exercising the
rights. Shareholders who
hold their shares in a bank or broker name should have received the
rights offering material from their bank or broker.
Under the rights offering, Zion has distributed (at no cost to stockholders) non-transferable subscription rights to holders of Zion's common stock on the close of business on the record date of September 28, 2010, to purchase their pro rata portion of approximately 3.8 million Units of Zion's securities Unit at a purchase price of $5.00 per Unit.
ONE UNIT = ONE SHARE (of Zion's common stock) + ONE WARRANT
The Warrant will allow the purchase of an additional share of Zion's
common stock at an exercise price of $4.00
and will be exercisable for a two year period beginning after the
offering expires.
You may wish to review the Frequently Asked Questions (FAQs) on our website at:
www.zionoil.com/investor-center
The Rights Offering is scheduled to expire on
November 15, 2010
so if you do wish to participate, please do so without delay.
"In your good pleasure, make Zion prosper..."
Psalm 51:18
Thank you for your support of Zion and Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
FORWARD LOOKING STATEMENTS:Statements in this communication that are not historical fact, including statements regarding Zion's planned operations, anticipated attributes of geological strata being drilled, the presence or recoverability of hydrocarbons, the sufficiency of cash reserves, ability to raise additional capital, the successful establishment of the drilling subsidiary and the negotiation and execution of definitive agreements with the current owner of the drilling rig with respect thereto, timing and potential results thereof and plans contingent thereon are forward-looking statements as defined in the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on assumptions that are subject to significant known and unknown risks, uncertainties and other unpredictable factors, many of which are described in Zion's periodic reports filed with the SEC and are beyond Zion's control. These risks could cause Zion's actual performance to differ materially from the results predicted by these forward-looking statements. Zion can give no assurance that the expectations reflected in these statements will prove to be correct and assumes no responsibility to update these statements.
NOTICE:
Zion Oil & Gas, Inc. has filed a
registration statement (including a prospectus) with the SEC for the
offering to which this communication relates. Before you invest, you
should read the prospectus in that registration statement and other
documents the issuer has filed with the SEC for more complete
information about Zion Oil & Gas and its offering. You may get these
documents for free by visiting EDGAR on the SEC website at
www.sec.gov.
Alternatively,
Zion Oil & Gas will send you the prospectus if you request it by
calling toll
free 1-888-TX1-ZION (1-888-891-9466).
Contact Information
FORWARD-LOOKING STATEMENTS: Statements in this press release that are not
historical fact, including statements regarding Zion's planned operations,
drilling efforts, proceeds of the rights offering, the successful
establishment of the drilling subsidiary and the negotiation and execution
of definitive agreements with Aladdin Middle East Ltd. (the current owner of
the drilling rig) with respect thereto and potential results thereof and
plans contingent thereon and the gross proceeds of the rights offering, are
forward-looking statements as defined in the "Safe Harbor" provisions of the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements are based on assumptions that are subject to significant known
and unknown risks, uncertainties and other unpredictable factors, many of
which are described in Zion's periodic reports filed with the SEC and are
beyond Zion's control. These risks could cause Zion's actual performance to
differ materially from the results predicted by these forward-looking
statements. Zion can give no assurance that the expectations reflected in
these statements will prove to be correct and assumes no responsibility to
update these statements.
For more information regarding the rights offering or to request copies of
the prospectus supplement relating to the rights offering when it becomes
available, you may contact us by calling toll free
1-888-TX1-ZION (1-888-891-9466) or
by contacting the Dallas Office at Zion Oil & Gas, Inc.,
6510 Abrams Rd., Suite 300, Dallas, TX 75231;
telephone 1-214-221-4610;
Email:
dallas@zionoil.com.
Copies of the prospectus
supplement, when available, will be available for viewing on the
website of the U.S. Securities and
Exchange Commission located at
www.sec.gov.
Zion's homepage may be found at:
www.zionoil.com
Contact:
Zion Oil & Gas, Inc.
Mike Williams, 214-221-4610
dallas@zionoil.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Dear
Shareholder and/or Friend of Zion
"In
your good pleasure, make Zion prosper..."
Psalm
51:18
Thank you for your support of Zion and, for our US stockholders and friends,
I wish you a very happy Labor Day weekend.
In addition, if you are observing Rosh Hashana (the Jewish New Year) next
week,
I wish you a 'Shana Tova' (Happy New Year).
Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
www.zionoil.com
FORWARD LOOKING
STATEMENTS: Statements in this communication that are not historical fact, including
statements regarding Zion's planned operations, anticipated attributes of
geological strata being drilled, the presence or recoverability of
hydrocarbons, the sufficiency of cash reserves, ability to raise additional
capital, timing and potential results thereof and plans contingent thereon
are forward-looking statements as defined in the "Safe Harbor" provisions of
the Private Securities Litigation Reform Act of 1995. These forward looking
statements are based on assumptions that are subject to significant known
and unknown risks, uncertainties and other unpredictable factors, many of
which are described in Zion's periodic reports filed with the SEC and are
beyond Zion's control. These risks could cause Zion's actual performance to
differ materially from the results predicted by these forward-looking
statements. Zion can give no assurance that the expectations reflected in
these statements will prove to be correct and assumes no responsibility to
update these statements.
Contact Information
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
More information about Zion is available at
www.zionoil.com
or by
contacting Mike Williams at Zion Oil & Gas, Inc.,
6510 Abrams Rd., Suite 300, Dallas, TX 75231;
telephone 1-214-221-4610; email: dallas@zionoil.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Zion Oil & Gas Newsletter
Dear Shareholder and/or Friend of Zion
Drilling operations on Ma'anit-Joseph #3 have begun!
As you can read in yesterday's press release
(click here) drilling operations on our
Ma'anit-Joseph #3 well
have begun. As I write (Friday morning, in Israel),
the drill bit has reached a depth of approximately 115 feet (35 meters).

Zion's President and Chief Operating Officer, Bill Ottaviani,
addressing the rig crews

Zion's Exploration Manager,
Stephen Pierce,
addressing the rig crews
"In
your good pleasure, make Zion prosper..."
Psalm
51:18
"In
your good pleasure, make Zion prosper..."
Psalm
51:18
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Zion Oil & Gas Newsletter
Dear
Shareholder and/or Friend of Zion
I'll start with most welcome news -
the rig mobilization
(from the Ma'anit-Rehoboth #2 wellsite to the
Ma'anit-Joseph #3 wellsite)
has begun, as you can
see in the pictures below.
Our current schedule indicates an
August 17 - 19, 2010 spud
date window for the new well and
the latest news regarding rig mobilization sustains that date.
Since my last update to you (on July 23, 2010) we have almost completed the
site construction for the
Ma'anit-Joseph #3 well.
In the past week, I visited the new wellsite, so here are some photographs
(from August 3rd, 4th and 5th)
showing that the site has been almost fully prepared. As I walked around the
site, I saw that everything was
very much in good order. Due to all the prior planning, our staff and
contractors are now implementing their
site construction work in a very calm and professional manner.
The Ma'anit-Joseph #3 wellsite (Aug 3, 2010)
A close-up of the Conductor Pipe (Aug 3, 2010)
The 'Mud Pit' being lined (Aug 4, 2010)
Digging a channel for the service pipes (Aug 4, 2010)
The 'Mud Pit' and the full wellsite (Aug 4, 2010)
The first containers arrive at the wellsite (Aug 5, 2010)
The conductor pipe and base of the rig (Aug 5, 2010)
The mud log unit on site (Aug 5, 2010)
So, our operations department is moving into high gear, as we all
"In your good pleasure, make Zion prosper..."
Psalm 51:18
Thank you for your support of Zion, and
Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
www.zionoil.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Zion Oil & Gas Newsletter
Dear Shareholder and/or Friend of Zion
Since my last update to you (on June 24, 2010) we have made much progress on
the drilling front. In addition,
today, we have made an announcement about management restructuring and an
addition to Zion's Board.
As you can read
here,
we announced that Kent S. Siegel, a member of Zion's Board of directors
since November 2003,
has been appointed as Chief Financial Officer and Senior Vice President. Mr.
Siegel replaces Sandra Green, who has resigned from the Company by mutual
and amicable agreement. I thanked Sandy for her many years of dedicated
work
and wished her well for the future.
In addition, Patti Beals has been appointed Chief Accounting Officer and
Ilan Sheena has been
appointed Vice President and Managing Director of Zion's offices in
Caesarea, Israel. Also, we are
welcoming to the Zion Board, Marc Singer who brings a wealth of business
experience to Zion.




As you can
read below, we have successfully concluded the acquisition of field seismic
in both our
Asher-Menashe License area and our Issachar-Zebulun Permit area. The raw
data that has been collected
is now being processed for interpretation, both here in Israel and in
Houston, Texas.
I am pleased to report that the data acquired does seem to be of good
quality. This was not easy to achieve,
as in the Asher-Menashe license area, there are some major roads. One night,
we arranged for the police to
stop the flow of traffic, so that the traffic 'noise' would not affect the
seismic acquisition.
Even with the latest computer technology, the data processing will take a
number of weeks to produce results
and then the resulting information will need to be carefully built into our
geologic computer model by Zion's geologists.
(As a Zion director commented:"If it was easy, then anyone could do
it...").
As a result, we should be able to have a much better picture of any geologic
structures under our
exploration areas and therefore make better decisions regarding our future
exploration plans.
RIGHTS OFFERING
The current rights offering was originally scheduled to terminate on June
30, 2010. However, as preliminary results indicated that the offering had
not been fully subscribed, we decided to extend the offering by
approximately two weeks, in order to allow more time for subscriptions to be
submitted. The new scheduled termination date for the rights offering is
Thursday, July 15, 2010.
Although, to date, we have raised significant amounts from the rights
offering, we believe that the
uncertain market conditions in the past weeks may have impacted negatively
on our rights offering.
We want to move forward with further work without delay, so we would like to
secure the maximum funds possible.
Almost certainly there will not be a further extension. After the
termination date of Thursday, July 15, 2010,
we plan to close the offering and issue the shares as soon as practicable,
most likely within two weeks following the close.
If you want to read the press release regarding the extension of the
termination date of Zion's rights offering, please click
here.
Christians United for Israel
As previously noted, Zion Oil & Gas will be sponsoring the "Night to Honor
Israel" banquet at the
Fifth Annual Washington-Israel Summit of Christians United for Israel (CUFI).
However, this year,
Zion will also be sponsoring CUFI's Ambassadors' Reception.
The Summit will take place in Washington, D.C. during July 20th to 22nd and
the banquet will take
place on Wednesday evening, July 21, 2010. Pastor John Hagee and Israel's
Ambassador to the U.S.,
Michael Oren, are scheduled to speak at the banquet.
It is expected that John Brown, Zion's Founder and Chairman, will be
interviewed by Pastor John Hagee
during the Summit and that the interview will be broadcast on the Daystar
Television Network during the "Night to Honor Israel". In addition, CUFI
will broadcast a video about Zion at the banquet's pre-event, and the
banquet's proceedings
will be telecast by live-feed over the Daystar Television network. If you
want to read the press release, please click
here.
In addition to beginning our well site construction, we have almost finalized the selection of vendors who will provide
"In
your good pleasure, make Zion prosper..."
Psalm 51:18
Thank you for your support of Zion, and
Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
www.zionoil.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Zion Oil & Gas Newsletter
Dear Shareholder and/or Friend of Zion
As Zion's annual meeting is scheduled to take place on Monday, June 14,
2010, in Israel, we are distributing this email one day earlier than normal.
This will give those who are not attending the meeting and have not yet
voted, a chance to vote. You can vote either by returning your prepaid
voting card, by telephone or by way of the Internet
For
everyone with an interest in Israel and its energy resources, we are living
through momentous times!
Recently, 'Oil & Gas in Israel' has been featured in Israel's business news
as almost a daily headline event. For example:
On June 2, 2010, Israel's business press reported that the estimated natural
gas reserves in the Tamar offshore license have been increased... again.
They have nearly doubled since the first estimates were published in
2009 and represent approximately 35 years of Israel's natural gas needs at
projected 2012 demand rates.
On June 3, 2010, Israel's business press reported that initial seismic
analysis indicated that the Leviathan prospect, offshore Israel, is
estimated at double the size of the Tamar discovery.
Clearly the prediction of the United States Geological Survey's report in
April 2010 that estimated the undiscovered oil and gas resources of the
Levant Basin at a mean of 1.7 Billion barrels of recoverable oil and 122
Trillion cubic feet of recoverable gas in the Levant Basin is beginning to
unfold before our very eyes.
As all of Zion's exploration areas fall within the Levant Basin... we are
very optimistic regarding our petroleum exploration areas, onshore
Israel.
(You can read the USGS Report if you
click here.)
Zion Oil & Gas, Inc. was established 10 years ago, at a time when the idea
of 'Oil in Israel' was seen as 'very unlikely' (to say the least),
as the last major discovery in Israel was the Heletz field (onshore southern
Israel) in 1955. Subsequently, Heletz produced more than 17 million barrels
of oil.
Now, we have seen a massive gas discovery offshore and even, in December
2009, an announcement of an onshore gas discovery, in another company's
license area, just to the south of Zion's license area.
The year 1955 was also the one in which Frank Sinatra first sang, "Love &
Marriage go together like a Horse & Carriage". From our perspective, where
there is 'Gas', there is likely to be 'Oil'. We all know the term 'Oil &
Gas'...
When Zion's Founder and Chairman of the Board, John Brown, heard the recent
news regarding the offshore gas deposits, he pointed to Isaiah 60:5:
"Then you will see this and
rejoice, and your heart will be thrilled with joy, because the riches of the
sea
will be brought to you. The wealth
of the nations will come to you."
As I write, over 1,650 people have viewed our latest
film, in which Bill Ottaviani (Zion's President and Chief Operating Officer)
and I discuss our goal to establish Zion Drilling, Inc. and purchase Aladdin
Middle East Ltd's 2,000 horsepower drilling rig, as soon as practicable.
The film gives you a chance to learn the strategic thinking behind some of
our business decisions. If you haven't yet watched the film, please take a
few minutes to do so and please share the link to the film with your
friends.
RIGHTS OFFERING
Under the rights offering
(see
www.zionoil.com/investor-center)
Zion stockholders, at the close of business
on May 6, 2010, were issued, at no charge, the following
ONE subscription right for every TWO shares of stock owned (as of the close
of business on May 6, 2010).
Each subscription right entitles the holder to purchase one share of Zion
stock at a price of $5.00,
irrespective of the market price at the time of purchase.
The subscription rights may be exercised at any time prior to the end of
June 2010.
However, after 5:00 pm EDT on June 30, 2010, unexercised subscriptions
rights will expire with no residual value.
Please note that if you want to exercise your rights and you hold your stock
in a brokerage account, then you will
need to contact your broker to determine when and how you can exercise your
rights, as each individual
brokerage firm has their own timeline and procedures for processing
subscriptions.
As detailed in the press release, we plan to use the proceeds from the
rights offering: (a) to purchase
a 51% interest in a new yet to be established company (Zion Drilling, Inc.
that will own a 2,000 horsepower drilling rig),
(b) to drill further 'deep' exploration wells on Zion's licenses in Israel
(in continuation of Zion's oil and gas exploration efforts) and (c) for
general corporate purposes.
This opportunity is only available
until June 30, 2010, in less than 20 days.
With regard to 'Operations', we are now preparing for the next well, as you can read.
Our geologists will then interpret this imagery as a basis for determining
if all the
necessary geological elements are in place for creating a drilling
prospect.
Ma'anit-Joseph #3 Well (M-J #3)
As previously noted, we have implemented a bidding process for key equipment
and services needed for the M-J #3 well and that early indications of
response from our selected vendors have been very favorable. The bidding
process is now closed and we are extremely pleased with the results.
To cite a few metrics regarding the process, we created (8) equipment and
service categories targeting (39) companies - both local and international.
These categories included casing, casing hardware, wellheads, drill bits,
cementing service, mud and drilling fluids service, wireline and logging
service, and equipment rentals. A total of (47) bid packages were issued
and (38) offers received...a very respectable 81% positive response rate.
We are now working through each category of bids, focusing first on those
that are most time-sensitive so that we have the equipment or service we
need, on location, when the well is spud. Several purchase orders for this
critical equipment have already been placed.
We continue to be encouraged by the pace in which "permitting" for the new
well is occurring. As noted last time, permitting a well in Israel is a
lengthy and time consuming process. Yet, we feel that we are 'on track' in
working with the various regulatory agencies to ensure that we are fully
compliant with the law and that we properly address the legitimate issues of
other concerned stakeholders in the project.
With vendor selection and well permitting moving along according to plan, we
now turn our attention to construction of the well site itself. To this
end, we are using the same philosophy we did in our bidding process for well
equipment and services. That is, we will seek out the best contractors that
are capable of doing the job to our specifications and who offer the best
overall value to Zion.
Ultimately, we want to position ourselves to begin well site construction
immediately after the final permit is 'in hand' that allows construction
activity to begin. Our expectation is that this timing will occur sometime
in July. Site construction can last about one month.
Overall,
work continues at a steady and productive pace in getting ready for a summer
2010 spud date of the Ma'anit-Joseph #3 well.
Elijah #3 Well
As previously noted, the Elijah #3 well was drilled to a depth of
approximately 10,938 feet (3,334 meters) when the drill string became stuck
within the Asher Volcanics section of the hole. After recovering a
significant portion of the stuck drill pipe, progress in recovering the
remainder of the pipe slowed and the decision was made to temporarily
suspend drilling operations pending further analysis of the situation.
We have decided to acquire approximately 32 kilometers of additional field
seismic data (in Zion's Asher-Menashe License area) that will help us to
resolve certain questions regarding the geology of the area surrounding the
Elijah #3 well. GII will perform this seismic acquisition work following the
work being done for us in the Issachar-Zebulun permit area.
Ma'anit-Rehoboth #2 Well (M-R #2)
This well is currently temporarily suspended for possible future use as an
offset well to the Ma'anit-Joseph #3 (M-J #3) well (see above) which is to
be drilled a short distance away.
It
is important to note that while the M-J #3 well is just a short distance
from the M-R #2 well, the geologic target for the M-J #3 well is completely
different than the zones tested in M-R #2. We are drilling to the deep
"Permian" structure in M-J #3; whereas the various intervals tested in M-R
#2 were shallower and comprised of younger, Triassic, age rocks. As such,
the results of testing the M-R #2 well are not correlative to what we expect
should we reach and test the Permian in the M-J #3 well.
|
PLEASE VOTE YOUR ZION STOCK TODAY |
"In your good pleasure, make Zion prosper..."
Psalm 51:18
Thank you for your support of Zion, and
Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
www.zionoil.com
Contact Information
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Zion Oil & Gas Newsletter
Dear Shareholder and/or Friend of
Zion...
The past two weeks have seen various Zion Oil & Gas matters move forward
significantly, as we:
(i) reported that the Israeli
Petroleum Commissioner awarded Zion Oil & Gas a one-year extension on each
of its petroleum exploration licenses, the Joseph License and the Asher-Menashe
License. (After the initial grant, it is 'normal
procedure' in Israel for license extensions to be granted only in
'one-year' extensions, for a total of four one year extensions.)
(ii) signed an agreement with Aladdin Middle East Ltd extending the drilling
contract to our planned next well, the Ma'anit-Joseph #3,
(iii) signed an agreement with Kibbutz Ma'anit granting us access to Kibbutz
land and permission to drill the Ma'anit-Joseph #3 well, and
(iv) signed an Agreement with the Geophysical Institute of Israel (GII) to
acquire a total of approximately 64 kilometers of two-dimensional seismic
lines located within our Issachar-Zebulun Permit area and our Asher-Menashe
License area.
On a national level, according to the latest rankings of the (politically
independent) Swiss Institute for Management Development (IMD), Israel's
economy is No. 1 in the world for resilience to
economic cycles.
This is a direct result of the actions taken by Israel's Finance Ministry
and the Bank of Israel, as they both acted very prudently in the recent
world economic crises.
Israel was also ranked No. 1 for its expenditure
in research and development as a percentage of gross domestic product and in
the innovative capacity of firms to generate new products, processes and
services.
In the business-efficiency category, Israel scored very highly in
availability of skilled labor, finance skills, entrepreneurship of managers
and venture capital.
All we need now is... to recover oil & gas onshore Israel...
So, here is a report of Zion's work during the past two weeks:
Rights Offering
Under the rights offering (see
www.zionoil.com/investor-center)
Zion stockholders, at the close of business on May 6, 2010, were
issued, at no charge, the following
ONE subscription right
for every
TWO shares of stock owned (as of the close of business
on May 6, 2010).
Each subscription right entitles the holder to purchase one share of
Zion stock at a price of $5.00, irrespective of the market price at the
time of purchase.
The subscription rights may be exercised at any time prior to the end of
June 2010. However, after 5:00 pm EDT on June 30, 2010,
unexercised subscriptions rights just expire with no residual value.
Please note that if you want to exercise your rights and you
hold your stock in a brokerage account, then you will need to contact
your broker to determine when and how you can exercise your rights, as
each individual brokerage firm has their own timeline and procedures for
processing subscriptions.
As detailed in the press release, we plan to use the proceeds from the
rights offering: (a) to purchase a 51% interest in a new company (Zion
Drilling, Inc. that will own a 2,000 horsepower drilling rig), (b) to
drill further 'deep' exploration wells on Zion's licenses in Israel (in
continuation of Zion's oil and gas exploration efforts) and (c) for
general corporate purposes.
As stock prices have been so volatile recently, perhaps I should mention
that subscribing in the rights offering directly helps Zion with its
work in Israel. Whereas, purchasing Zion stock by way of the stock
exchange (e.g. NASDAQ) means that the money goes to the seller and so
does not directly help Zion with its work.
The United States
Geological Survey (USGS Survey)
As previously reported, the USGS report (issued April 8, 2010)
"Assessment of Undiscovered Oil and Gas Resources of the Levant Basin
Province, Eastern Mediterranean" has attracted much media attention in
Israel. (You can review the USGS Survey by clicking
here.)
You may be interested to know that the term "Levant" first appeared in
English some 500 years ago and originally meant "Mediterranean lands to
the East" as in the French "soleil levant" (i.e. rising Sun). It
referred to the Eastern direction of the rising Sun from the perspective
of those who first used it.
The USGS Survey estimates a mean of 1.7 BILLION barrels of recoverable
oil and 122 TRILLION cubic feet of recoverable gas in the Levant
Basin... and that has caught everyone's eye, as the value of the
undiscovered oil and gas assessed in the USGS Survey amounts to
approximately US$ 650 Billion...
and of course all of Zion's exploration areas fall within the Levant
Basin...
With regard to 'Operations', we are now preparing for the next well, as
you can read.
Ma'anit-Joseph #3 Well (M-J #3)
Further to our ongoing exploration work on the Ma'anit geological
structure, we are moving forward with the required permitting and
planning for the M-J #3 well (targeted for the 'deep' Permian geologic
structure). (Deut. 33:13-16)
We are well underway in the process of assembling the various product
and service suppliers needed to drill this new well. As reported last
time, we instituted a bidding and selection process designed to ensure
that we use the best available resources, offering Zion the most
favorable overall value. Based on early vendor indications, we
anticipate a strong response to our RFQs (Request For Quotes)
and have already begun receiving price quotes. All price quotes are
expected by month-end and the final vendor selection will follow shortly
thereafter.
Permitting for the new well continues to proceed favorably with the
recent achievement of a very significant milestone: agreement with
Kibbutz Ma'anit granting us access to Kibbutz land where we desire to
drill the MJ-3 well.
In Israel, 'permitting a well' is a very lengthy and
complicated process, as permits are required from various authorities,
including the: Water, Fire, Health, Military, District Planning
Commission, Environmental Protection, Israel Land, National
Infrastructure, Civil Aviation and National Transport Authorities... and
of course, the owner of the land.
With the Kibbutz agreement now secured, we are fine-tuning the well site
layout and beginning preliminary plans for construction of the site.
The layout and construction of the well site is a project in of itself,
as it involves the careful placement of storage containers, offices and
living quarters, equipment and liquid storage facilities, power units,
and piping all efficiently arranged around the drilling rig and large
liquid containment ("mud") pits while allowing adequate space for the
safe movement of personnel and heavy equipment.
As the M-J #3 well site is near residential and commercial areas, we are
working diligently with local and governmental groups, to ensure the
site will meet (or in some cases exceed) all applicable environmental
and safety requirements.
Actual well site construction can begin once we have received all
necessary permits. Depending on weather and equipment availability, we
anticipate site construction to be completed within one month after
being started. Given the progress we are making in both planning and
permitting for the M-J #3 well, we remain optimistic that drilling will
begin this summer.
Elijah #3 Well
The Elijah #3 well was drilled to a depth of approximately 10,938 feet
(3,334 meters) when the drill string became stuck within the Asher
Volcanics section of the hole. After recovering a significant portion of
the stuck drill pipe, progress in recovering the remainder of the pipe
slowed and the decision was made to temporarily suspend drilling
operations pending further analysis of the situation.
We have decided to acquire approximately 32 kilometers of additional
field seismic data (in Zion's Asher-Menashe License area) that will help
us to resolve certain questions regarding the geology of the area
surrounding the Elijah #3 well. In order to perform this seismic
acquisition work, we recently signed an agreement with the Geophysical
Institute of Israel (GII). The seismic acquisition is scheduled to take
place in summer 2010.
Ma'anit-Rehoboth #2 Well (M-R #2)
This well is currently temporarily suspended for possible future use as
an offset well to the Ma'anit-Joseph #3 (M-J #3) well (see above) which
is to be drilled a short distance away.
The Issachar-Zebulun Permit Area
Zion and GII have signed an agreement for GII to acquire approximately
32 kilometers of seismic data in Zion's Issachar-Zebulun Permit area.
Zion will use this seismic data in search of geologic prospects that we
hope can be matured into new well candidates.
Permitting for seismic acquisition is well underway with field work now
scheduled to begin in June.
2010 Annual Meeting of Stockholders - in just
two weeks time...
The annual meeting is scheduled to take place at the Dan Caesarea Hotel
in Caesarea, Israel at 2:00 p.m. (local time) on Monday, June 14, 2010.
If you are planning to attend the meeting in person and would like to
reserve a room at the Dan Caesarea Hotel, please contact Ora Weisman in
our Israel office at
ora@zionoil.com
to take advantage of a special room rate offered only to Zion
shareholders.
IMPORTANT NOTE: In prior years, the SEC allowed brokers to vote the
shares of stockholders who held shares at the broker but did not express
an opinion regarding how they wished to vote their shares. The new
rules do not allow your shares to be voted on certain items without you
personally voting your shares, so please vote your shares.
You can vote either by returning your prepaid voting card, by telephone
or by way of the Internet.
Your vote really does count, so please take a very few
minutes in order to exercise your right as a Zion Oil & Gas
stockholder.
"In
your good pleasure, make Zion prosper..."
Psalm 51:18
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Zion Oil & Gas Newsletter
Dear
Shareholder and/or Friend of Zion...
This past week, Israel has been in the news (again) as the 31 members of the
group of rich nations, the OECD (Organisation for Economic Cooperation and
Development) unanimously voted to invite Israel to join.
OECD's mission is to enhance cooperation among members while meeting high
international economic standards; membership will surely boost Israel's
economic standing and help attract investment to Israel.
The Israeli Finance Minister called the move "historic".
We believe that the day will arrive when Zion Oil's work will also be deemed
"historic" and are steadily working towards that day.
Here is a report of Zion's work during the past two weeks:
ONE subscription right for every TWO shares of stock owned.
Each subscription right entitles the holder to purchase one share of Zion stock at a price of $5.00,The USGS report
(issued April 8, 2010)"Assessment of Undiscovered Oil and Gas
Resources of the Levant Basin Province, Eastern Mediterranean"
has attracted much media attention in Israel.
(You can review the USGS Survey by clicking
With regard to 'Operations', we are now preparing for the next well, as you
can read.
Ma'anit-Rehoboth #2 Well (M-R #2)
This well
is currently temporarily suspended for possible future use as an offset well
to the Ma'anit-Joseph #3 (M-J #3) well (see below) which is to be drilled a
short distance away.
Ma'anit-Joseph
#3 Well (M-J #3)
Further to our ongoing exploration work on the Ma'anit geological structure,
we are quickly moving forward with permitting and planning for the M-J #3
well (targeted for the 'deep' Permian geologic structure). (Deut. 33:13-16)
Our new well design is now
finalized and we have begun the process of assembling the various product
and service suppliers needed to drill this new well. To date we have issued
(9) Requests for Quotations ("RFQs") to dozens of vendors addressing all the
major components needed to drill and test a well: tubulars, mud system,
wireline services, well testing, cementing, etc. The early indication is
that most vendors will participate in our RFQ process and seem quite eager
to do business with us in Israel. We have 'cast a wide net' in soliciting
price quotes and will carefully analyze the results, when received, to
ensure that we use the best available resources offering Zion the most
favorable overall value.
Permitting for the new well continues to move at a very good pace with
progress being made on all fronts. We continue to move forward with both
local and governmental groups in assessing needs and working towards
mutually agreeable outcomes.
Barring any unforeseen delays or complications, we remain on track to "spud"
(i.e. begin drilling) the well
in the summer of 2010.
Elijah #3 Well
The Elijah #3 well was drilled to a depth of approximately 10,938 feet
(3,334 meters) when the drill string became stuck within the Asher Volcanics
section of the hole. After recovering a significant portion of the stuck
drill pipe, progress in recovering the remainder of the pipe slowed and the
decision was made to temporarily suspend drilling operations pending further
analysis of the situation.
We have decided to acquire additional field seismic data that will help us
to resolve certain questions regarding the geology of the area surrounding
the Elijah #3 well. The timing for this work is scheduled to take place in
mid-summer 2010.
The Issachar-Zebulun Permit Area
Zion and the Geophysical Institute of Israel (GII) have signed an agreement
for GII, on behalf of Zion, to acquire approximately 30 kilometers of
seismic data in Zion's Issachar-Zebulun Permit area. Permitting for seismic
acquisition is already underway and the timing for the field work is
scheduled to coincide with the seismic field work for the Elijah #3 project
area.
2010 Annual Meeting of Stockholders -
in just one month...
The annual meeting is scheduled to take place at the Dan Caesarea Hotel in
Caesarea, Israel at 2:00 p.m. (local time) on Monday, June 14,
2010. If you are planning to attend the meeting in person and would like to
reserve a room at the Dan Caesarea Hotel, please contact Ora Weisman in our
Israel office at
ora@zionoil.com
to take advantage of a special room rate offered only to
Zion shareholders.
IMPORTANT NOTE: In prior years, the SEC allowed brokers to vote the
shares of stockholders who held shares at the broker but did not express
an opinion regarding how they wished to vote their shares. The new
rules do not allow your shares to be voted on certain items without you
personally voting your shares, so please vote your shares.
You can vote either by returning your prepaid voting card, by telephone
or by way of the Internet.
Your vote really does
count, so please take a very few minutes in order to exercise your right
as a Zion Oil & Gas stockholder.
"In your good pleasure, make Zion prosper..."
Psalm 51:18
Thank you
for your support of Zion, and
Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
www.zionoil.com
|
FORWARD LOOKING
STATEMENTS: Statements in this communication that are not
historical fact, including statements regarding Zion's planned
operations, geophysical and geological data and interpretation,
anticipated attributes of geological strata being drilled,
drilling efforts and locations, the presence or recoverability
of hydrocarbons, the sufficiency of cash reserves, ability to
raise additional capital, the successful establishment of the
drilling subsidiary and the negotiation and execution of
definitive agreements with AME (the current owner of the
drilling rig) with respect thereto, timing and potential results
thereof and plans contingent thereon are forward-looking
statements as defined in the "Safe Harbor" provisions of the
Private Securities Litigation Reform Act of 1995. These forward
looking statements are based on assumptions that are subject to
significant known and unknown risks, uncertainties and other
unpredictable factors, many of which are described in Zion's
periodic reports filed with the SEC and are beyond Zion's
control. These risks could cause Zion's actual performance to
differ materially from the results predicted by these
forward-looking statements. Zion can give no assurance that the
expectations reflected in these statements will prove to be
correct and assumes no responsibility to update these
statements. NOTICE Zion Oil & Gas, Inc. has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about Zion Oil & Gas and its offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, Zion Oil & Gas will send you the prospectus if you request it by calling toll free 1-888-TX1-ZION (1-888-891-9466).
|
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Zion Oil & Gas Newsletter
Dear Shareholder and/or Friend of Zion...
During the past two weeks, Israel celebrated its 62nd birthday and, almost
to the day, Zion Oil & Gas
celebrated its 10th birthday.
According to Harvard University Professor of Economic History, David Landes,
"In the last 50 years, only one country in the world has moved from being
a third world economy to a first world economy...and that is Israel!"
At Zion Oil, we believe that we may be able to help Israel's economy (soon,
we hope) by discovering significant quantities of oil and gas onshore in
Israel.
We are not completely alone in our belief that there are significant
quantities of oil and gas waiting to be discovered. You can read below the
latest estimates of the United States Department of the Interior (Geological
Survey Department) and also the thoughts of Hal Lindsey in his recent weekly
report.
In any event, our daily efforts continue steadily and with determined focus.
So, here is the report of Zion's work during the past two weeks:

Thank you for your support of Zion, and
Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
www.zionoil.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Zion Oil & Gas Newsletter
Dear Shareholder and/or Friend of Zion...
I am happy to announce some excellent news. This past week, Zion Oil & Gas
and Aladdin Middle East Ltd (AME)
signed a Memorandum of Understanding
(MoU) that I
believe will not only be good for both
Zion Oil and AME, but also for the State of Israel.
The MoU outlines our plan to establish a subsidiary, tentatively named
"Zion Drilling, Inc.", for the purpose of purchasing and
operating AME's 2,000 horsepower drilling rig (currently located at Zion's
Ma'anit-Rehoboth #2 wellsite, in Israel).
Zion Drilling, Inc. will purchase AME's drilling rig for an initial payment
of US$ 7 million and a series of US$ 1 million additional payments that are
anticipated to coincide with our drilling seven additional wells in Israel
over the next few years. As the funds for the purchase of the rig are to be
provided by Zion Oil & Gas, our plans are subject to a number of events,
including due diligence, the raising of additional capital and the
establishment of Zion Drilling.
Towards that, I am pleased to tell you that, today, our US$ 50 million Shelf
Offering S-3 Registration Statement
was declared effective by the Securities and Exchange Commission. So,
through the S-3,
we now have the possibility of raising the additional funds required to
implement our plans.
The MoU provides that Zion Drilling, Inc. will be 51% owned by Zion Oil &
Gas and 49% owned by AME.
However, AME will be responsible for the daily operation of the rig.
Our goal in establishing Zion Drilling, Inc. is to continue to drill wells
in Israel without dependence on any outside third party. By implementing
this plan, we will secure control of a drilling rig for our planned future
operations and, as a consequence, raise our exploration business to a
completely new level.
With regard to the Ma'anit-Rehoboth #2 well, you can read below the results
of the completion work. We plan to temporarily suspend work on this well
although we may return to the well at some later stage. Although the results
of the completion work are not what we had hoped for, as we are not able to
announce a commercial discovery, we believe that we have laid an excellent
foundation for our next well, (named by us) the Ma'anit-Joseph #3 well.
We are currently in the process of obtaining the required permits for the
Ma'anit-Joseph #3 well, targeted to reach the Permian geological formation,
lying deep beneath the surface. (Deut. 33:13-16)
To date, we have not managed to reach the Permian geological layer, even
though it has been one of our main goals from the earliest days of the
project. But we are as determined as ever to reach that goal, hopefully, in
our next well. (Jer. 29:11)
To quote Chuck Davidson, CEO of Noble Energy, the Texas Company that found
the Tamar discovery (currently valued at > US$ 15 Billion) offshore Israel:
'There is no such thing as a sure thing in the energy exploration
business'.
Although this was the case during the Ma'anit-Rehoboth #2 well completion,
we are firmly resolved to use all the information and experience that
we gained and drill again into the Ma'anit structure. (Psalm 135:6)
There are a number of reasons why we are so very optimistic regarding the
possibility of finding oil & gas onshore in Israel:
(i) During operations, we recovered some crude oil from the Ma'anit-Rehoboth
#2 well and we also noted
(much more than expected amounts of) natural gas during the drilling phase.
(ii) Last week, the US Geological Survey (USGS) issued a report estimating
that there are 1.7 Billion barrels of recoverable oil and
122 trillion cubic feet of natural gas in the Levant Basin
Province. The USGS defines the Levant Basin Province as an 83,000
square kilometer area of the Eastern Mediterranean... a large proportion of
which is in Israel's economic zone (both offshore and onshore Israel). You
can review the map and read the full report
here.
(iii) This week, representatives of Russian energy giant
GAZPROM
met with Dr. Mimran, Israel's National Infrastructure Ministry's
petroleum commissioner, to discuss the possible involvement of Gazprom with
Israel's offshore natural gas fields. The press also reported that: 'a
number of other Russian energy giants are showing interest in the Israeli
energy and infrastructure sector.'
(iv) Within the past two weeks,
'Globes'(one of Israel's leading
business publications) published an interview with Fred Zeidman, who has
been Chairman of the Board or a director of various Texas based oil & gas
drilling / exploration / refining companies. In 2002, President Bush
appointed him 'Chairman of the US Holocaust Memorial Council'.
Fred Zeidman made a number of comments regarding the (very bright) future
for oil exploration in Israel, including:
1. The prospects in Israel are
'brilliant'.
2. The (Tamar etc.) offshore findings were amazing and
it is hard to
believe that there are no hydrocarbons onshore.
3. It could be that the onshore deposits will be found 'much deeper'. (This
comment was no surprise to us, of course.)
4. Royalties in Israel of 12.5% are reasonable.
His advice to investors is that
investment in oil and gas can be
wonderful, but you need 'patience'.
However,
the reward, once successful, is enormous.
We are certainly unhappy that we were not able to declare a commercial
discovery as a result of the recent completion operations. But our team
remain convinced that our license areas and our permit area will ultimately
deliver to us their deeply hidden treasure... in G-d's good time.
We have both the patience and the firm resolve... and now, we expect to soon
have the right tool to finish the job -
a 2,000 Horsepower drilling rig in Israel on a permanent basis.
"In your
good pleasure, make Zion prosper..."
Psalm 51:18
Thank you for your support of Zion, and
Shalom from Israel
Richard Rinberg
CEO of Zion Oil & Gas, Inc.
www.zionoil.com
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