1.5 Billion Barrel Oil Discovery in Israel?

News reports out Israel of a 1.5 billion barrel oil discovery lit up websites and news postings yesterday. Israeli oil exploration company Givot Olam announced to the Tel Aviv Stock Exchange (TASE) on Tuesday that, “Production test drilling at Givot Olam’s Meged 5 site near Rosh Ha’ayin indicated it holds 1.525 billion barrels’ worth of oil.” And boy did it start a stir!

Givot Olam stock shot up 69% at one point, before finally settling out at a 19.7% gain … meanwhile trading was suspended and the Israel Securities Authority demanded clarifications of the report from Givot Olam – who didn’t have anything to add.  They said a full report would be available in September.

According to Israeli newspaper Haaretz, “This is not the first time Givot has issued partial and less than definitive information.” If you visit the Givot Olam website (http://www.givot.co.il/english/index.php) today you’ll read about the 2 billion barrels they “discovered” (but never produced) in 2004.  The truth behind this week’s “discovery” is that their tests don’t show how much oil they can produce or how much the discovery may be worth financially. What they do know is that even if there is 1.5 billion barrels down there, only a small percentage of it is recoverable; estimates range from 10% to 25%.

Givot Olam has been pumping oil mixed with gas and water from the Meged 5 test well for about a week and a half, averaging about 380 barrels per day. Israel consumes 235,000 barrels of oil per day. At the rate the Meged 5 is pumping now the well would supply less than two tenths of one percent of Israel’s daily consumption. If just 10% of Givot Olam’s “discovery” was recoverable (150 million barrels), the Meged 5 would have to maintain its current pace for over a thousand years to harvest the field. Israel burns through 150 million barrels in less than two years.

Haaretz reports: A geophysicist in the field, however, called the most recent announcement “speculative” and said the 1.525 billion figure appeared “exaggerated.”

“The bottom line is that I want to see the well’s capacity of barrels per day over time,” he said. “How much the drilling site can produce – that’s what will answer questions regarding its economic viability. Regarding the reserves, I don’t think they can be assessed at the moment. It’s a very rough estimate and everything gets into the range of probabilities.”

That’s what the geophysicists in Israel (the guys who know) are saying. It’s the same thing they told me after Givot Olam announced its 2 billion barrel “discovery” in 2004.

Bottom Line: Givot Olam’s announcement of a 1.5 billion barrel discovery is highly speculative and most likely exaggerated. A “discovery” doesn’t mean how many barrels a company can actually commercially produce (2004′s 2 billion barrel “discovery” commercially produced exactly zilch). We’ll need to wait until Givot Olam submits their definitive report in September and watch production on the Meged 5. Yesterday’s announcement created a lot of hoopla, but nobody, including Givot Olam, knows the substantive reality of the “discovery” at this point.

But that didn’t stop some Israeli news agencies and  Christian websites (Joel Rosenberg’s included) from running the headline “1.5 BILLION BARRELS OF OIL DISCOVERED IN ISRAEL” with few, if any, facts to back up the headline.

So why am I raining on everyone’s parade? Here’s why: the truth. There’s nobody that believes Israel will discover oil in a big way more than I do (except maybe John Brown of Zion Oil and Tovia Luskin of Givot Olam). And I believe the Bible (Torah) points to that discovery (so do John Brown and Tovia Luskin). But sensational headlines taken from unsubstantiated announcements don’t forward the search. When sensational headlines (like the 2 billion barrel “discovery” in 2004) don’ t pass the test of reality, they only disappoint the folks who believed them in the first place and hurt the credibility of those who ran the headline. That  said, here are the facts:

• The Bible (Torah) states that Jacob (Israel) would “suck honey out of the rock, and oil out of the flinty rock.” (Deut 32:13) Of Joseph (Ephraim and Manasseh) it states: “Blessed of the LORD be his land, for the precious things of heaven, for the dew, and for the deep that coucheth beneath, And for the precious fruits brought forth by the sun, and for the precious things put forth by the moon, And for the chief things of the ancient mountains, and for the precious things of the lasting hills, And for the precious things of the earth and fulness thereof …. (Deut. 33:13-16).  That Zebulun and Issachar “shall suck of the abundance of the seas, and of treasures hid in the sand.” (Deut 33:19) And that Asher would “dip his foot in oil.” (Duet 33:24)
• Tovia Luskin and John Brown founded their oil exploration companies based on their belief that scripture points to a major oil discovery in Israel.
• Zion Oil & Gas and Givot Olam have proven that oil exists deep below the territories the Bible (Torah) said it would be found.   Givot Olam has pumped more than 3,000 barrels of it in the last week and a half.
• Serious geological studies by the Geophysical Institute in Israel and the US Geological Survey have backed up Luskin’s and Brown’s belief by stating that they estimate a mean of 1.7 billion barrels of oil and 122 trillion cubic feet of natural gas are recoverable in the Levant Basin, which includes onshore and offshore Israel.
• Enough natural gas to supply all of Israel’s needs into the foreseeable future has already been discovered off the coast of Northern Israel.

The facts are enough. Israel has discovered huge quantities of natural gas, they’ve discovered oil right where the Bible said it would be, and I believe Israel is on the cusp of discovering major quantities of producible oil, both onshore and offshore – enough to supply them into the foreseeable future.  It’s happening now, but it hasn’t happened yet. The prophecy of Israel’s oil, I believe, is being fulfilled before our eyes, but it hasn’t been fulfilled yet. Misleading headlines aside, Givot Olam’s discovery is a part of that fulfillment. I’ll report the facts to you as we see them unfold. In the meantime here’s a more balanced article on the subject from the Israeli newspaper Haaretz: http://www.haaretz.com/print-edition/business/givot-olam-meged-has-1-5b-barrels-of-oil-1.308683

Steve Spillman

Israel’s Biblical Oil Explorers

THE SEARCH FOR OIL IN THE LAND OF ISRAEL

A BIBLICAL TREASURE HUNT

By Philip Mandelker

APPENDIX

SCRIPTURALLY INSPIRED / INFLUENCED PETROLEUM

EXPLORATION IN ISRAEL

_______________________

1.         Company: Asher Oil Company

Founder: Wesley Hancock. California based. A family company was active in oil and gas exploration in the United States.

Scriptural Basis: Blessing of Asher in Deuteronomy and story of Elijah’s sacrifice in I Kings.

Period of Activity: Early-middle 1960s.

Area of Activity: North-east flank of Mt. Carmel overlooking the plain of the Kishon Stream.

Primary Activity: Drilling of two wells:

(i) Asher #1: 1963 – drilled to 2,391 meters (7,845 ft) to a target in the Middle Jurassic. Results: Dry.

(ii) Asher #2: 1965 – drilled to 1,314 meters (4,311 ft) to a target in the Middle Jurassic. Results: Dry

Related Non-Scripturally Inspired Drilling:

In 1975, Sonol, a major Israeli gasoline marketing company reentered the Asher #2 well and deepened it to 2,596 meters (8,517 ft) to a target in the Early Jurassic. In 1980, OEL, an Israeli-government exploration company drilled the Asher #3 near the first two Asher wells to 574 meters (1,883 ft) to a Cretaceous target. Both these wells were dry.

2.         Company: Energy Exploration Inc.

Founder: Andy Sorelle. Texas based petroleum engineer and wildcatter.

Scriptural Basis: Blessing of Asher in Deuteronomy

Period of Activity: First half of 1980s.

Area of Activity: Coastal plain between Mt. Carmel and the Mediterranean Sea, specifically in the area of the town of Atlit.

Primary Activity: Drilling of one well in two stages:

(i) Atlit #1: 1981 – drilled to 5,273 meters (17,301 ft) to a target in the Early Jurassic. Results: Dry

(ii) Atlit #1 Deep: 1982-1983 – deepened the Atlit #1 to 6,531 meters (21,428 ft) to target in Late Triassic. Results: asphalt and then light oil shows in cuttings before well was lost for technical reasons.

3.         Company: Moriah Exploration

Founder: Gilman Hill. Colorado based geoscientist active in oil and gas exploration and developer of exploration technology.

Scriptural Basis: Story of Elijah’s sacrifice in I Kings and the Blessing of Asher in Deuteronomy.

Period of Activity: Early and mid-1980s.

Area of Activity: Mt. Carmel near the traditional site of the Elijah sacrifice.

Primary Activity: Drilling of two wells in 1980 and 1986:

(i) Elijah #1: 1980 – drilled to 2,682 meters (8,800 ft) to a target in the Middle Jurassic. Results: Dry.

(ii) Elijah #2: 1986 – drilled to 651 meters (2,136 ft) to a target in the Cenomanian. Results: Dry.

4.         Company: Ness Energy

Founder: Harold “Hayseed” Stephens. A Texas oil and gas explorationist and operator.

Scriptural Basis: Genesis stories of Sodom and Gomorrah and a long series of scriptural references in various books of the Old Testament.

Period of Activity: 1980s and late 1990s-2001.

Area of Activity: Area surrounding the southwest quadrant of the Dead Sea and adjacent areas.

Primary Activity: Participation in drilling of one well in 1985; acquisition of certain exploration licenses in the late 1990s. The well, the Har Sedom #1 was targeted to be drilled to about 3,500 meters about 11,500 ft), but was lost for technical reasons at 1,818 meters (5,965 ft) in the Pliocene. The exploration licenses were lost following the failure of Ness to meet its obligations under the licenses to commence the drilling of wells on the license areas.

Related Non-Scripturally Inspired Drilling Activity

The Har Sedom #1 project and well were developed and operated by an Israeli commercial oil exploration company, Seismica. Ness Energy held a minority working interest (about 15%) in the well.

5.         Company: Hoshana Oil Company

Founder: Bernard Coffindaffer. West Virginia based evangelical minister and missionary.

Scriptural Basis: Blessings of Asher, Zebulon and Issachar in Deuteronomy

Period of Activity: Early 1990s

Area of Activity: Southern flank of Mt. Carmel and the Valley of Jezreel just east of the South-eastern flank of Mt. Carmel.

Primary Activity: Acquisition of an exploration license and reprocessing and analysis of seismic data. License lapsed with no progress made towards drilling of well.

6.         Company: Camberly Exploration

Founder: Lyle Harron. Canadian oil and gas explorationist.

Scriptural Basis: Blessings of Asher in Deuteronomy

Period of Activity: Early-middle 1990s.

Area of Activity: Coastal plain between Mt. Carmel and the Mediterranean Sea.

Primary Activity: Drilling of one well:

(i) Atlit #2: 1996 – drilled to 1,633 meters (5,388 ft) to a target in the Early Cretaceous. Results: Dry.

7.         Company: Givot Olam Oil Exploration

Founder: Tovia Luskin. Russian born and educated geophysicist, active in oil and gas exploration in Canada and Australia, before moving to Israel.

Scriptural Basis: The Blessings of Joseph in Genesis and Deuteronomy

Period of Activity: 1990s to date

Area of Activity: Eastern portion of Sharon Plain between Netanya and Modiin

Primary Activity: Drilling of three wells commencing in 1994:

(i) Meged #2: 1994 – drilled to 5,200 meters (17,061 ft) to a target in the Triassic. Results: 40⁰ API Silurian aged oil recovered from the Middle Triassic.

(ii) Meged #3: 2000 – drilled to 4,742 meters (15,683 ft) to a target in the Triassic. Results: Oil and gas shows in the Middle Triassic, but reservoir of very poor quality (very low porosity and permeability.)

(iii) Meged #4: 2002/3 – drilled to 4,919 meters (16,139 ft) to a target in the Triassic. Results: 360 API Silurian aged oil recovered from the Middle Triassic. Attempts in 2005 to drill a horizontal bore-hole in the well in an attempt to recover the oil which is located in tight reservoir rock failed apparently for technical reasons, with the well abandoned following loss of equipment in the horizontal bore.

Plans underway to drill another Meged well and attempt to develop the Meged field discovery, which was recognized by the Israel Petroleum Commissioner in 2004.

8.         Company: Zion Oil & Gas, Inc.

Founder: John Brown. Michigan and Texas based businessman with roots in the machine-tool industry and active in building contracting sectors.

Scriptural Basis: The Blessings of Joseph in Genesis and Deuteronomy.

Period of Activity: 1990s to date.

Area of Activity: Manasseh hills and Sharon plain from the southern flanks of Mt. Carmel to Netanya.

Primary Activity: Drilling of a well in 2005:

(i) Ma’anit #1: (Re-entry) 2005 – deepening of previously abandoned Ma’anit #1 from 2,335 meters (7,661 ft) to 4,719 meters (15,483 ft) to targets in the Middle and Early Triassic. Results: The company announced that during drilling and completion operations, the well had numerous significant oil and gas shows in a 2,100-foot interval.

Analysis of the results of the well is continuing and future activity, including designing comprehensive completion procedure and drilling of an appraisal well being considered.

Related Non-Scripturally Inspired Drilling Activity:

The Ma’anit #1 was originally drilled to 2,335 meters (7,661 ft) in 1995 by an Israeli commercial oil exploration company, Sdot Neft. Though originally targeted to 4,500 meters (14,765 ft), it was abandoned as a dry hole after Sdot Neft ran out of money

(for a PDF Download of Philip Mandelker’s entire study go to: http://www.oilinisrael.net/resources/biblical-treasure-hunt-free-pdf)

A Closer Look at Givot Olam

Just south of Zion Oil’s Joseph license in Northern Israel lies the 60,000 acre Rosh Ha’ayin production lease belonging to Israeli oil company Givot Olam. A production lease, according to Israeli petroleum law, can only be issued after the exploration company has proven existing oil and/or gas reserves in place. In 2004 Givot Olam, through their three exploration wells, the Megeds 2, 3 and 4, proved to the Israeli government that there was oil under their exploration license … to the tune of nearly a billion barrels.

Despite attempts to develop the exploration wells, Givot Olam has yet to get commercial quantities of their oil discovery to the surface. The company began drilling the Meged #5 well last month, hoping to change their luck, take advantage of what they’ve leaned in the last five years and produce a sellable amount of oil.

Here’s something interesting; Givot Olam’s founder, Tovia Luskin, a trained petroleum geologist, began his quest for oil in Israel when he read about the prediction of vast petroleum reserves waiting to be discovered in the Holy Land. Would you like to know where Mr. Luskin first read about this possible discovery? The Bible … more accurately, the Torah.

Sounds familiar doesn’t it? Let’s put aside for a moment the fact that oil was discovered in Israel in 2004, by a company that based their search on scripture. Let’s put aside for a moment what the first fact does to the credibility of every critic and self-rising opinionater that has, over the last five years, trashed the idea that oil could ever be discovered in Israel based on scripture for the sole reason that it was based on scripture. Let’s put aside for a moment the fact that we’re not waiting for someone to discover oil in Israel – it’s already been done; we’re just waiting for someone to bring it up and put it in barrels. Let’s put all that aside and take a quick look at the man who first discovered the oil prophesied by Jacob to his sons nearly 4,000 years ago.

Tovia Luskin

In a story that seems to be dominated by Christian oil explorers, it’s a little ironic that the only oilman, using the same scriptures as the Christian explorers, to actually have a proven oil discovery in Israel, is Jewish.

Tovia Luskin, like his evangelical Christian counterparts, has been searching for oil in Israel for a long time now – more than twenty years. Like his Christian counterparts, Tovia used the Bible as his guide for finding oil in the Holy Land. Unlike his Christian counterparts, Tovia has actually discovered the oil promised to the Children of Israel in Genesis and Deuteronomy!

Luskin, a Russian Jew and a geologist, earned degrees in geophysics at Moscow State University. As a former lead geologist for Shell Oil and advisor to Bridge Oil in Sydney, Australia, his extensive background in the oil industry gave him the professional credence to back up his religious conviction that there was indeed, oil in Israel.

Working in Australia in 1988, Tovia, new as a practicing Jew, came upon a passage in the Torah in Deuteronomy.

Tovia is naturally quiet about sharing his religious beliefs concerning the oil with skeptics who would use them to discount his professional and technical efforts on the project. But to those sincerely interested, he happily quotes from memory the passage that began his quest:

About Joseph, he (Moses) said: “May the Lord bless his land with the precious dew from heaven above and the deep waters that lie below; with the best the sun brings forth and the finest the moon can yield; with the choicest gifts of the ancient mountains and the fruitfulness of the everlasting hills…”

(Deut. 33:13 NIV)

This passage in Deuteronomy along with his discovery that the medieval Jewish scholar Rashi interpreted the passage to mean that the “everlasting hills” were much older than the surrounding countryside was proof that he was on to something.

Rashi’s interpretation struck home with Luskin. He knew, as a geologist, that the concept of one geological feature (the hills) being of a different age than the land surrounding it was an accepted fundamental of modern geological science. But this concept was unknown in the time Rashi wrote his interpretation. In Luskin’s view, Rashi had no way of interpreting the passage this way other than by divine guidance.

These two proofs were enough for him to write to Rebbe Menachem Mendel Schneerson, one of the world’s renowned Jewish scholars, for his review and consideration of the interpretations. After reviewing his material, the Rebbe, responded noting, “I had pleasure in reading your discussion …” and “… You will tell me good news ….”

This was enough for Luskin to take action. He traveled to New York for a personal audience with the Rebbe. The Rebbe pronounced over him a Bracha (blessing) regarding his proposed search for oil in the Promised Land, “You have my blessing that you will have good news in the near future.” This innocuous sounding blessing carried tremendous authority for Luskin. He believed the Rebbe to be G_d’s Moshiach (Messiah), the one to bring redemption to the Jews. This was enough for Luskin to sell his home in Sydney, Australia and immigrate to Israel.

By 1993 Tovia Luskin had assembled a team of geologists and oil experts (most of them Russian from his previous acquaintance at Moscow Sate University) to form Givot Olam Oil Exploration, LLC. Givot Olam, Hebrew for “everlasting hills,” secured a 62,500 acre exploration license just north and east of Tel Aviv.

Their first well, the Meged 2, was drilled in 1994 and successfully tested 40° API oil at 17,000 feet. In 1998 the Meged 2 was retested and showed a 400 barrel per day flow rate. The Meged 3 well was drilled two years later a few miles to the west of the Meged 2. This well logged 47 feet of pay (the vertical area of the well from which to extract oil) at 15,000 feet deep, but had to be shut down because of mechanical problems in the hole. The Meged 4, north of the Meged 2 and Meged 3, was drilled in 2003. At 16,000 feet the Meged 4 began flowing oil and gas. The rate of flow was unspecified but Givot Olam reported a commercial discovery of 980 million barrels. With the Meged 4 discovery the Givot Olam eighteen month exploration license became a thirty year production lease.

Today Givot Olam is in the process of developing the Meged Oil Field with plans for 10 wells in a 50 square kilometer project area. With proper development each well is conservatively estimated to produce over 900 barrels per day for the first year, and then decline to a steady 400 barrels per day over each well’s seven year expected lifespan. The ten wells in this field, roughly one-fifth of Givot Olam’s production lease area, in the conservative view is capable of producing over 12 million barrels of oil over the next seven years.

Israel has only produced 20 million barrels in its entire fifty year history of oil production. Personally Luskin estimates the Givot Olam lease area to hold as many as a billion barrels of oil. Twenty percent of those billion barrels, Luskin believes, is recoverable. Two hundred million barrels … not bad for Jewish Russian immigrant using the Torah and his Rebbe’s blessing as a guide!

Givot Olam Resumes Drilling

“The blessings of your father excel the blessings of my ancestors and the bounty of the eternal hills. May they rest on the head of Joseph, on the crown of the prince of his brothers.” (Genesis 49:26)