Profile: Zion Oil & Gas, Inc. (ZN.O)

Zion Oil & Gas, Inc. (Zion Oil), incorporated on April 6, 2000, is an oil and gas exploration-stage company. The Company holds two exclusive exploration licenses covering approximately 162,100 acres onshore in the State of Israel between Netanya in the south and Haifa in the north. One license, named the Asher-Menashe License, covers an area of 78,824 acres located on the Israeli coastal plain and the Mt. Carmel range between Caesarea in the south and Haifa in the north. The second license, named the Joseph License, covers an area of 83,272 acres located on the Israeli coastal plain south of the Asher-Menashe License between Caesarea in the north and Netanya in the south. In January 2008, the Company completed the acquisition of approximately 52.5 kilometers of seismic lines in the Ramot Menashe and Nahal Me’arot areas within the Asher License area.

The Company drill a well, (the Ma’anit-Rehoboth #2), to an initial depth of approximately 15,400 feet (targeted to a bottom-hole location in the Triassic formation approximately 2,500 feet east-northeast of the bottom-hole location of its previously drilled well, the Ma’anit #1), to appraise the apparent findings of the Ma’anit #1 in the Triassic at a depth of between approximately 12,000 and 15,400 feet. The Company ultimately deepen the Ma’anit-Rehoboth #2 well to a depth of about 18,040 feet to appraise and test the deeper Permian horizons at a depth of between approximately 16,000 and 18,000 feet.

The Joseph License

The Company in accordance with terms of the Ma’anit-Joseph License, the predecessor of its Joseph License, the Company drilled the Ma’anit #1 well on the Ma’anit prospect. Drilling breaks and shows of hydrocarbons were recorded from approximately 12,000 feet to the total depth of approximately 15,500 feet. The Company applied for a new license covering approximately 83,000 acres of the original Ma'anit-Joseph License, including the Ma'anit structure on which its Ma'anit # 1 well was drilled and on which the Company plan to drill the Ma'anit-Rehoboth # 2 well. The Company filed with the Israeli Petroleum Commissioner a presentation of the Permian prospect on the Ma’anit structure on the Joseph License.

Zion’s staff of three geologists is using an Israeli country-wide seismic database residing in its Kingdom seismic interpretation and geologic mapping software from Seismic Micro Technology. Its geo-scientists are utilizing two workstations containing the software. The database consists of 250 seismic sections totaling approximately 3,300 kilometers of coverage and also includes the stratigraphic sections from all the wells drilled in Israel.

The Asher Menashe License

In May 2005, the Company applied for a preliminary permit with priority rights to conduct exploration activities on areas covering approximately 500,000 dunam (approximately 124,000 acres) abutting its Ma'anit-Joseph License and lying to its north and west in order to continue its exploration of the exploratory trend it developed under the Ma'anit License and Joseph Permit areas. In applying for the new permit, the Company proposed a two-staged program of geological and geophysical work extending over an 18 month period aimed at developing a drillable prospect in the permit area.

On August 1, 2005, the Company was granted Preliminary Permit No. 186/Asher with Priority Rights for an area covering 490,000 dunam (approx. 121,100 acres). The permit covers lands on the Israeli coastal plain and the Mt. Carmel range stretching north to the outskirts of Haifa. In connection with the work program requirements for the Asher Permit and continuing exploration of its license area, the Company reprocessed approximately 200 kilometers of seismic lines and has used the data to begin detailed mapping of a number of prospect leads.

In accordance with the terms of the Asher Permit, the Company submitted a final report and prospect identification. In conjunction with the report and in exercise of its priority rights under the permit, the Company filed an application with the Petroleum Commissioner for a petroleum exploration license tentatively denominated the Asher-Menashe License, on approximately 322,000 dunam (approximately 81,000 acres) north of the Ma'anit-Joseph License, of which approximately 310,000 dunam (approximately 78,000 acres) were subject of the Asher Permit and some 12,000 dunam (approximately 3,000 acres) abut the Asher Permit acreage to the north. In the application, the Company proposed to include the acquisition of 20 kilometers of seismic data in the Ramot Menashe region and the drilling of a test well in that region to the Triassic formation.