By Is now the time to buy Zion Oil & Gas (ZNOG) shares?
Here at TabStocks we have extensively covered various aspects about Zion Oil & Gas’ operations. These updates can be read here.
We have considered many aspects about Zion’s past, present and future Oil and Gas operations and their possible ability to generate revenue from commercial Oil and or Gas from their current MJ02 Oil Well or other Wells not yet drilled.
The ZNOG stock price is at the time of writing $0.14, down from around $0.18 following the last Zion update 03 October 2022.
It’s clear that investors are nervous given the current situation regarding the water leaking into the lower zone of interest Zion believes provides the best chances of recovering Oil.
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The area of interest Zion Oil & Gas intend to fully test is some 65 feet deep.
The thickness of the zone is enough to get excited about because it’s a large area.
And within such a large area, if there is Oil and that Oil could be recovered, the pressure and flow rates are likely to be high.
To date, Zion have not elaborated on whether their 3D data had detected the presence of hydrocarbons.
However, what investors can deduce is that following conducting 3D testing, Zion Oil & Gas did seek to obtain a rig that could drill deeper.
And this was following the completion of its MJ01 Well.
Zion’s MJ01 Well failed to produce any tangible signs of Oil within the depths drilled. Though Zion held the belief that Oil existed at a deeper level. Therefore, 3D testing was carried out.
We do not know whether Zion Oil & Gas drilled MJ01 deeper when Zion set up the new rig – that could drill deeper – over MJ01. Zion did not report information to investors. But we do know that the Zion Oil & Gas stock price rose to over $1.70 around about the same time.
Since that time the ZNOG share price has fallen to lows of 10 cents but has risen into the mid 30 cents a number of times.
It’s clear that the Zion stock price has suffered due to the court case that Zion successfully defended it should be noted; and then them leaving the NASDAQ and listing on OTC.
It’s worth pointing out that on a number of trading and investing platforms, ZNOG had been suspended with – sell only – orders able to be filled.
This also has a bearing on the ZNOG price given that those for instance trading using the Trading212 App have not been able to buy more ZNOG shares.
There were pros for Zion to have left the NASDAQ, yet given the how long drilling and testing was going to take with MJ02, it’s also clear that Zion needed and still needs funding to continue with the project.
Notwithstanding, Zion continued to increase the number of its board members, and this could be seen as a good sign of its confidence that it was on to a winner with its current MJ02 Well in pursuit of discovering Oil for commercial production.
Zion Oil & Gas did not seem to struggle to obtain funding which came from some bigshot investors. And its wide investor base continued to invest in Zion Oil & Gas shares directly through the company; thereby locking in the funding Zion needs.
At times the ZNOG stock had been heavily traded by day and swing traders taking advantage of the delays and fears of mostly long-term Zion Oil & Gas shareholders who had given up and sold their holdings at a loss.
It actually benefits big investors when the Zion stock price falls, because if good news is ultimately to arrive then large orders can be filled at lower prices.
Meanwhile board members have been filling their boots with cheap Zion Oil & Gas shares.
You have to conclude that Zion Oil & Gas believed (and maybe still do) that there is Oil from the site where they drilled MJ02 which is the same site as MJ01.
The 3D data must have confirmed this as I stated above.
Pretesting on MJ02 Zion Oil & Gas had applied for a permit to drill another Well. We do not know the location of this proposed drill site, nor whether the permit had been granted.
We do know that Zion’s findings through drilling MJ02 must have been enough evidence, i.e., strong enough for them to have made an application to the Israeli Ministry of Energy though.
Did Zion Oil & Gas encounter Oil within the main zone of interest when they drilled MJ02?
I believe they had. And there was a jump in the ZNOG share price around about this time. No doubt Zion would have at some stage reported their findings to the Ministry of Energy officials.
The valve Zion choose to install is one in which we might expect to see on an Oil Well that is to be made commercial to produce high quantities of Oil or many thousands of barrels of Oil per day.
Given the size of the zone of interest and the valve, it’s easy to conclude that Zion Oil & Gas could be on to a winner and 20,000 barrels of Oil per day (B/D) is not unrealistic.
It’s clear that Zion Oil & Gas are keeping their cards close to their chest, and reluctant to inform the market of what they do know as fact.
When they report news, its generally old news for them, since they have mostly long since moved on with operations by the time a newer operational update has been released.
I suspect the next we’ll hear is that Zion’s new drilling permit had been granted.
Thereafter, news that Zion has blocked off the flow of water from the upper level, investors will be able to find out the results of Zion’s Oil testing of its main zone of interest within MJ02.
I think the final testing results should arrive by mid-November or early December 2022 at the latest.
If there is a share price rise before news updates from Zion Oil & Gas, then I would expect that the water leak has stopped, and an information leak leads to a share buying frenzy will begin during and following testing.
Generally, if the results are looking good during testing it might be difficult to keep such information secret. And this should be reflected in the ZNOG share price.
So, is now the time to buy Zion Oil & Gas (ZNOG) shares?
Well, if you believe the water can be stopped and the results of the testing a success then yes.
At 14/15ents with a potential high as much as $10.00 – if not more in a crazy spike – then it is indeed a good entry point to load up on cheap Zion Oil & Gas shares.
However, if MJ02 fails, then it might be worth holding back some cash to buy in cheaper or to buy more; a lot more shares at a cheaper price, since the ZNOG share price could tank to around 3 cents if not lower.
Whatever your view or the outcome of MJ02, if Zion Oil & Gas operations continue beyond MJ02 then I’m sure the ZNOG share price will live in to see further highs in the future.
Therefore, buying low and holding for the future might be a tactic you might employ if you can avoid not becoming too emotional or too greedy.
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