The firm has purchased drilling rig, drill pipe, and related equipment from an undisclosed seller
Zion Oil & Gas has closed a purchase and sale agreement to acquire drilling equipment for its operations in Israel for $5.6m.
Under the deal, the firm has purchased drilling rig, drill pipe, and related equipment from an undisclosed seller.
As per the terms of the deal, Zion Oil & Gas has paid $4.6m in the form of cash to the seller and the remaining $1.0m will be paid to an escrow agent.
After the arrival of the rig in Israel and completion of acceptance testing the remaining amount will be paid by Zion Oil & Gas to the escrow agent.
Zion chief operating officer Robert Dunn said: “This is a new era for Zion and a positive step forward for our 2020 exploration plans.
“With our asset based in the State of Israel, our planning and flexibility will become more robust.”
Details of rig purchased by Zion Oil & Gas
A 1600 horsepower AC Top Drive equipped rig with a twin 1600 horsepower mud pump system with a depth capability of 20,000ft will be supplied to Zion.
The firm said that the rig will comprise almost 15,000ft of heavy 5″ drill pipe as well as the associated well control equipment and inventory.
Zion president Bill Avery said: “We believe this is the right time for this to happen.
“Having cash budgeted and available for the purchase of this rig shows the strong support of our shareholders and evidence of God’s faithfulness.”
The rig, which went through a full CAT III & IV certification in late 2017, and the related equipment, will be imported into Israel from Romania, where the Drilling Rig is currently stored.
In October last year, Zion announced the completion of data acquisition for its Megiddo-Jezreel 3-D seismic programme.
The seismic acquisition covered over 72km2 within its Megiddo-Jezreel license, a large onshore area of approximately 99,000 acres in Israel.