“Special Report – Zion Oil”
August 16, 2011 by sspillman · 17 Comments
(Zion CEO Richard Rinberg (c), VP Victor Carrillo (l), and President Bill Ottavianni (r))
What’s in Store for Zion Oil & Gas?
I get e-mails and comments to this website (a lot of e-mails and comments) with questions about the future of Zion Oil & Gas. The emails and comments traffic goes way up whenever there’s a big rise or a big dip in Zion’s daily stock price. When the stock goes up Zion fans are dancing in the streets; when it goes down there’s sackcloth and ashes. The questions that come to me invariably take the form of, “What has Zion done to make their stock go up?” or “What have they done to make their stock go down?”
The answer? From my perspective, a definite long term perspective, nothing unusual. Zion operates day to day, week to week, month to month, and now year to year, in a pretty methodical manner. Plan, test, explore, review, repeat. I’ll admit, it’s not a very exciting methodology, but I’d rather have a dull methodology with exciting (long term) results than exciting methodology with no results (there’s been too much of that from other ‘explorers’ already).
So why does Zion’s stock go up and down? I’m no stock whiz, but from what I’ve seen at least some of it has to do with what’s happening outside of Zion. Earlier this year Zion’s share price spiked from under $4.50 to nearly $6.00 in a few days. The reason? Zion Oil & Gas attended the National Religious Broadcasters Convention in Nashville where religious (and secular) press took advantage of the situation, asked for interviews with Zion Founder John Brown and CEO Richard Rinberg and reported Zion’s story. The stock went up – there wasn’t a change in the company’s exploration strategy or operations, John and Richard just shared Zion’s story.
A few months ago Zion’s stock took off again (from about $4.75 to nearly $7.00). Why? Part of the reason may have been that Zion announced it had reached target depth on their Ma’anit-Joseph #3 well. Another part may have been that the Dow Industrial Averages jumped at the same time … most stocks were going up, Zion’s did too.
Just lately, Zion’s stock has taken a nosedive. Why? Part of the reason may be that testing showed Zion’s Ma’anit-Joseph #3 to be ‘non-commercial’. Another part of the reason may be that Stock markets (in the US and abroad) took an historic nosedive in the last few weeks. Noble Energy has discovered the largest gas find in Mediterranean history and their stock dove 20% when the markets went into free fall.
What’s the moral to my story?
I’m not a stock analyst and don’t want to be. To me it’s just gambling; trying to predict tomorrow with averages, spreadsheets and theories … or rumors. Events are going to happen outside and inside a company that’ll probably make it’s stock go up and down. If you’re a day-trader (someone who buys and sells daily, gambling on tomorrow’s stock report) I guess daily ‘events’ float your boat.
But (I don’t believe) a company like Zion Oil & Gas is for day traders. It’s for those of us in it for the long run. The only two ‘events’ worth paying attention to would be a commercial discovery or Zion closing up shop. They haven’t made a commercial discovery (yet) and they have no intention of closing up shop. So until either of those two events transpire I’ll look for long term strategy to achieve long term results. Is the company doing what it set out to do?
Zion Oil & Gas was founded to discover oil and gas in Israel. They’re doing just that. They’ve drilled four wells to date, none commercial, but they’ve learned from each well. Zion’s Chief Geologist Stephen Pierce says that, on average, only one in nine exploration wells produces oil or gas in commercial quantities. A few years ago, because they knew they had to go deep, Zion flew to Turkey and secured a drilling rig twice the size of anything available in Israel. That rig just finished the deepest well ever drilled in Northern Israel. This week Zion geologists will participate in advanced mapping methods training host by one of the world’s best (if not the best) seismic software companies. Zion’s geology and exploration teams work every day to cut down those one-in-nine odds.
Zion started out with a 28,800-acre license. Today they have 218,000 acres of exploration territory and have applied for another 312,000 acres. 530,000 acres of exploration territory would make Zion the largest, by far, onshore exploration company in Israel.
In the last few years Zion has continued to successfully raise capital in spite of the worst economic/investment environment this country has experienced in decades. Today, they’ve got $29,260,00 in the bank.
When Zion started, discovering oil and gas in Israel was a myth; today it’s a fact, backed up by the world’s biggest gas find in more than a decade, a USGS study stating (conservatively) that there are significant oil and gas reserves in Israel, and recent news that Israel contains the world’s second largest deposits of oil shale.
Bottom line:
I’ll look at Zion’s stock price after they’ve discovered oil. Until then, I’ll look at Zion for how well they’re accomplishing their mission. More importantly, I’ll look to the One who gave Zion the mission. Israel has already discovered more natural gas than they will ever use. I believe oil is right behind it – G-d has already promised it.
Israel ‘deploys drones’ over offshore gas fields
August 15, 2011 by admin · Leave a Comment
The "Heron" drone is pictured at the Palmahim Airbase in central Israel (AFP/File, Menahem Kahana)
JERUSALEM — Israel has deployed drones to keep watch on gas fields off its northern coast, fearing attack by the Hezbollah militia from neighbouring Lebanon, the Jerusalem Post daily reported on Tuesday.
The fields lie in a part of the Mediterranean that is claimed by Israel for gas exploration and production, but Lebanon says the fields lie within its territorial waters.
“The decision to deploy drones was made in order to maintain a 24-hour presence over the site,” the paper said, adding that the air force was equipped with the locally made Heron drone, which has special electro-optics designed for maritime work.
The Israeli military would not confirm or deny the Post report to AFP.
The paper said that the air force started aerial surveillance after a warning last month from Hezbollah, which in 2006 fought a deadly war with the Jewish state in which it used anti-ship missiles.
“The Israeli enemy cannot drill a single metre in these waters to search for gas and oil if the zone is disputed… No company can carry out prospecting work in waters whose sovereignty is contested,” the Shiite group said.
The Hezbollah threat came after Israel’s cabinet approved a map of the country’s proposed maritime borders with Lebanon and submitted it to the United Nations, which has been asked to mediate in the dispute.
The map conflicts with one submitted by Lebanon to the UN last year, which gives Israel less territory.
The two countries are technically at war and will not negotiate face to face.
The disputed zone consists of about 854 square kilometres (330 square miles).
The two biggest known offshore fields, Tamar and Leviathan, lie respectively about 80 kilometres (50 miles) and 130 kilometres (81 miles) off Israel’s northern city of Haifa.
Tamar is believed to hold at least 8.4 trillion cubic feet of gas (238 billion cubic metres), while Leviathan is believed to have reserves of 16 trillion cubic feet (450 billion cubic metres).
In June an Israeli company announced the discovery of two new natural gas fields, Sarah and Mira, around 70 kilometres (45 miles) off the city of Hadera further south.
Jacob’s Blessing Video
Steven Spillman speaking at the 2010 Louisiana Bible Prophecy Conference. “Jacob’s Blessing: The Treasures of the Deep”. The Bible prophecies a last days oil discovery in Israel.
Barclays bullish on Leviathan partner Ratio
August 2, 2011 by admin · Leave a Comment
Israel's Offshore Gas Fields
Ratio is the investment bank’s stock pick in the energy sector.
2 August 11 12:15, Hillel Koren
Leviathan partner Ratio Oil Exploration (1992) LP (TASE:RATI.L) is Barclays Capital’s top pick in Israel’s energy sector. The bank reiterates it “Overweight” recommendation but lowered its target price from NIS 0.74 to NIS 0.71, still a 69% upside on today’s opening price of NIS 0.41.After a four-day road show with Ratio CEO Yigal Landau and Geologist Josh Steinberg, Barclays analyst David Kaplan says that the company compares favorably with its European peers. “Even in our worst-case scenario where we drop the oil targets from our valuation entirely we still see 13% upside from the current share price,” he says. Under the most optimistic scenario, which include the oil prospects and the LNG facility, Barclay’s valuation is NIS 2.27 per share – 441% above the current share price
Kaplan says that Israel current offshore discoveries at Mari-B, Tamar, and Leviathan, are only the first in the Levant basin. While it is clear that there will be disappointing drills, he believes that current best estimate of 25 trillion cubic feet of natural gas “is still the tip of the iceberg,” citing a 2010 US Geological Survey report, which estimates 122 trillion cubic feet of gas and 1.6 billion barrels of oil in the Levant basin.
Kaplan says that Ratio, with $100 million in cash and no debt, is properly capitalized for its 2011-12 capital expenditure plan, which includes bringing in a marine operator for its Gal license (south of Leviathan), and the upcoming Leviathan 3 exploratory well and the resumption of the Leviathan 1 well to oil targets in deeper strata.
Ratio owns 100% of Gal, and 15% of Leviathan; Delek Group Ltd. (TASE:DLEKG) and Noble Energy Inc. (NYSE: NBL) own the rest.
Israeli oil find changes stakes across Mideast
August 2, 2011 by admin · 5 Comments
While Israel is the model for liberty and democracy in the Mideast, it has no known oil reserves to speak of, making it an oddity in the world’s most oil-rich region. Many of its neighbors, on the other hand, abound in their vast oil wealth, which for decades they’ve used to prop up tyrannies and fuel hatred and terror.
Yet in one fell swoop, a recent geological find could change all this, positioning Israel as an exemplar of how political freedom can combine with the economic freedom oil provides.
Exploration in the Shfela basin, an area just southwest of Jerusalem, has uncovered oil shale deposits that are believed by some leading experts to hold the equivalent of at least 240 billion barrels of oil. In comparison, Saudi Arabia, the world’s largest oil producer, has reserves containing 250 billion barrels. While production would be at least a decade away, the potential effects of this development cannot be underestimated.
It would at last free the world from the clutches of OPEC, the cartel comprised mostly of assorted Arab tyrannies, theocracies and totalitarian states that currently controls global oil prices. Since the 1970s, OPEC has used its power to blackmail the West into acceding to policies that undermine its own vital interests on many fronts and, with at least partial success, isolate Israel. OPEC members have also used billions of petrodollar profits to plant the seeds of an intolerant and supremacist Islamic ideology in mosques, schools and other institutions in the U.S. and elsewhere. These, in turn, have sprouted such poisonous fruit as the Taliban, Muslim Brotherhood and numerous other extremist Jihadist movements that threaten American interests and lives.
A large supply of Israeli oil outside of OPEC’s control would disrupt the cartel, reduce oil prices and OPEC’s profits, and consequently offer a powerful stimulus for the U.S. and global economy. It would simultaneously deprive Iran of the oil revenue they’ve used to support terrorist groups such as Hezbollah and Hamas, suppress democratic movements at home and elsewhere, kill American troops in Iraq and Afghanistan, and develop their underground nuclear weapons program that threatens the entire free world.
The immense profit from oil sales would allow Israel to dramatically boost its already-prodigious scientific capabilities, which was integral in developing the modern computer chip, the Internet, telecommunications technology, drip irrigation and many other boons to humanity. The technology created by Israel for its oil retrieval will allow other nations with shale reserves to gain their own energy independence. Oil profits will generate extra funding for Israel’s cutting-edge defensive weapons industry, which recently developed the world’s first working anti-missile shield, a product that will likely benefit the entire civilized world.
Finally, this development demonstrates yet again that it is in America’s vital interest to ensure that Israel, the region’s only democracy, remains safe, secure, and strong – both militarily and economically – in a region of instability and enormous threats. For as technology entrepreneur George Gilder recently wrote in the Wall Street Journal, “We need Israel as much as it needs us.”
