updated 12/16/2010 6:45:44 AM ET 2010-12-16T11:45:44

DALLAS and CAESAREA, Israel, Dec. 16, 2010 (GLOBE NEWSWIRE) -- Zion Oil & Gas, Inc. (Nasdaq:ZN) announced today that on December 15, 2010, it completed its previously announced rights offering. The preliminary outcome of the rights offering, as of the close of business on December 15, 2010, indicates that subscriptions for approximately 3.65 million units, for gross proceeds of approximately $18.25 million, have been received (including over-subscriptions). All shareholders that requested over-subscription shares will be awarded their full over-subscription request.

Zion's Chief Executive Officer Richard Rinberg said today, "I am pleased to announce the successful conclusion of our rights offering. The proceeds from this offering provide us with the funds that we believe are necessary to allow us to proceed with our planned drilling subsidiary, provide us with financial and operating flexibility and enable us to further our exploration and drilling program significantly.

"We have successfully drilled approximately two-thirds of our Ma'anit-Joseph #3 well and are now drilling the final third.

"We remain excited about the possibility of recovering hydrocarbons on our license and permit areas, onshore Israel, especially due to the U.S. Geological Survey report, published in April 2010, containing their assessment that there may be 1.7 billion barrels of recoverable oil and 122 trillion cubic feet of recoverable gas in the Levant Basin, as all of Zion's exploration rights fall within the area of the Levant Basin."

Under the completed rights offering, holders of record of Zion's common stock were given non-transferable subscription rights to purchase eighteen (18) Units for every one hundred (100) shares of common stock owned as of the close of business on September 28, 2010. The purchase price of a Unit was $5. Each Unit consisted of one (1) share of Zion's common stock and one (1) warrant to purchase an additional share of Zion's common stock at an exercise price of $4.00.

Zion is currently drilling its Ma'anit-Joseph #3 well in Northern Israel and has currently reached a drilling depth of approximately 13,123 feet (4,000 meters). The Ma'anit-Joseph #3 well has targets in both the Triassic geological zone and the Permian geological zone. The primary target is Permian age lithology, expected at a depth of approximately 19,357 feet (5,900 meters).

For updates on the drilling activity please visit Zion's website www.zionoil.com

Zion's common stock trades on the NASDAQ Global Market under the symbol "ZN" and Zion's $7 warrants trade under the symbol "ZNWAW". From December 28, 2010 through their expiration date of December 31, 2012, Zion's $4 warrants will trade on the NASDAQ Global Market under the symbol "ZNWAZ." Zion's transfer agent is in the process of distributing the share and warrant certificates to those rights holders who participated in the rights offering, either directly or through their brokers.

Zion Oil & Gas, a Delaware corporation, explores for oil and gas in Israel in areas located on-shore between Haifa and Tel Aviv. It currently holds two petroleum exploration licenses, the Joseph and the Asher-Menashe Licenses, between Netanya, in the south, and Haifa, in the north, covering a total of approximately 162,000 acres and the Issachar-Zebulun Permit Area, adjacent to and to the east of Zion's Asher-Menashe license area, covering approximately 165,000 acres. Zion's total petroleum exploration rights area is approximately 327,000 acres.

The Zion Oil & Gas, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=6850

FORWARD LOOKING STATEMENTS: Statements in this communication that are not historical fact, including statements regarding Zion's planned operations, geophysical and geological data and interpretation, anticipated attributes of geological strata being drilled, drilling efforts and locations, the presence or recoverability of hydrocarbons, sufficiency of cash reserves, the successful establishment of the drilling subsidiary and the negotiation and execution of definitive agreements with the current owner of the drilling rig with respect thereto, timing and potential results thereof and plans contingent thereon are forward-looking statements as defined in the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on assumptions that are subject to significant known and unknown risks, uncertainties and other unpredictable factors, many of which are described in Zion's periodic reports filed with the SEC and are beyond Zion's control. These risks could cause Zion's actual performance to differ materially from the results predicted by these forward-looking statements. Zion can give no assurance that the expectations reflected in these statements will prove to be correct and assumes no responsibility to update these statements.

Zion's homepage may be found at: www.zionoil.com

CONTACT:  Zion Oil & Gas, Inc.
          Mike Williams
          214-221-4610 
          dallas@zionoil.com
          6510 Abrams Rd., Suite 300
          Dallas, TX 75231

© Copyright 2012, GlobeNewswire, Inc. All Rights Reserved

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