Zion Oil & Gas Operational Update – July 17, 2020

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Dear Zion Oil & Gas Supporters and Shareholders,

 

We wanted to give you an update on several matters here at Zion as we move forward to get our rig into Israel and the challenges we seek to overcome with God’s help.

First, we have released a podcast with the president of Agile Seismic, Goran Stankovic, where we discuss several aspects of our 3-D seismic acquisition, processing, and interpretation. If you haven’t listened to it, we encourage you to listen by clicking here.

Second, we continue to be encouraged by our supporters. As an example, we received an offer for additional computer servers for the processing of the seismic as needed in the future – without charge! We are looking into this opportunity to see if it will provide a material benefit to us at this point, given the amount of data already processed and how we might wish to reprocess in the future for specific needs.

Third, we are facing several hurdles in Israel, primarily due to ongoing COVID-19 restrictions:

  • We are having difficulty establishing timelines for getting equipment into the country due to the fluidity of Israel’s border closures since March 15th. Currently, foreign workers are not allowed into the country, and Israel’s Ministry of the Interior and Ministry of Health continually monitoring and modifying restrictions, particularly with respect to the issuance of visas. Having an experienced crew is critical because there are no onshore drilling crews available in Israel capable of operating the type of rig Zion has purchased.

  • All drilling crew personnel require Israeli quarantine plans along with onsite health safety plans prepared.

  • We are now able to move the rig out of Romania (150+ truckloads to the port of Constanta on the Black Sea). Upon the arrival of the rig at the Israeli port, the costs will be much higher without a knowledgeable and experienced crew in Israel to receive the rig. It is only a 5-7 day sail from Romania to Israel with advanced customs paperwork completed. The costs to store the rig at an Israeli port would be approximately $4,500 per day compared to $3,500 per month at a secure facility in Romania.

  • We are thankful that our rig mats shipped from Houston, TX, are now in Israel and currently at the port in Haifa. They will soon be transported to our storage facility avoiding any port fees.

  • We have had productive meetings with additional service providers, such as those providing well logging equipment.
     
  • You may learn more on the latest with COVID-19 in Israel online here, here, and here.

In summary, we are ready to go on the European front but are waiting now on the Israeli front. These hurdles highlight the fact that the pandemic has virtually halted global commerce, but we are preparing every detail so we can move through any openings that occur, as soon as they occur.

We are thankful for so many small favors where we see God moving, but we ask that you pray that God will reduce the impact of the pandemic in Israel for their sake and so that we may move forward with our exploration plans.

We appreciate your support and know that God’s timing is not our timing (Psalm 37:7).

Sincerely,

Rob Dunn
CEO & COO
Zion Oil & Gas

FORWARD-FORWARD-LOOKING STATEMENTS: Statements in this communication that are not historical fact, including statements regarding Zion’s planned operations, anticipated attributes of geological strata that may be drilled or tested in the future, Zion’s ability to successfully raise the funds needed to undertake these exploration efforts; Zion’s ability to continue as a going concern; Zion’s ability to comply with the continued listing requirements of the Nasdaq Capital Market; Zion’s ability to import into Israel or otherwise obtain the necessary 3-D imaging and related equipment and appropriate staff at commercially reasonable rates, Zion’s success in obtaining the necessary licenses and permits needed to undertake the seismic shoot, the timing of the 3-D seismic survey and the interpretation of the results, operational risks in ongoing exploration efforts, Zion’s ability to raise the capital needed to complete the 3D survey and the interpretation of the results thereof, 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.