Israel: Zion, Lapidoth may set up deep land rig entity

Zion Oil & Gas Inc., Dallas, and Lapidoth Israel Oil Prospectors Corp. Ltd. have signed a memorandum of understanding under which they would establish a company to acquire a land rig with a depth capacity of as much as 25,000 ft.

The entity, Zion-Lapidoth Drilling, will be owned 50-50 and would equally share the estimated $15 million cost of the rig. The MoU provides that Zion Oil will retain Zion-Lapidoth Drilling for its drilling program and when not required by Zion Oil, Zion-Lapidoth Drilling may lease the drilling rig to third parties.

Zion Oil said the partnership would “alleviate a longstanding concern about our ability to continue to drill exploratory wells in Israel without dependence on an outside third party.”