ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT

Extension of Joseph Petroleum Exploration License

On August 13, 2012, the Israeli Petroleum Commissioner notified Zion Oil & Gas, Inc. (the "Company" or "Zion") that it was approving the Company's request for an extension to the scheduled expiration date of the Company's Joseph License (Petroleum Exploration License No. 339) to April 10, 2013. In July 2012, the Company submitted a letter to Israel's Petroleum Commissioner seeking an extension of the scheduled work program time frames which would in essence extend the Joseph License beyond the scheduled expiration date of October 10, 2012 to accommodate unavoidable delays in seismic equipment and crews attributable to the Company's contractor, Geophysical Institute of Israel (GII), having their crews in Africa for an extended period of time.

Under the terms of the Joseph License, as extended, the Company is required, among other things, to (i) obtain a seismic survey, process and integrate the data and submit the process report and ancillary material to the National Geophysical Archive maintained at GII by October 15, 2012, (ii) interpret, process and integrate the results of the new seismic survey with existing seismic lines, update the geophysical maps and submit a geophysical summary and file a report with the Israeli Petroleum Commissioner by December 15, 2012,
(iii) identify and prepare a drilling prospectus that includes a geological description of the geological background, the desired drilling depths, a geological forecast and engineering plan for the proposed drilling by January 15, 2013, and (iv) execute a drilling contract to drill a new well or drill the existing well by February 15, 2013.

The Company has contracted with GII for a 20 kilometer seismic survey that it anticipates will be acquired in September 2012.

At the option of the Israeli Petroleum Commissioner, the Joseph License may be extended for additional one-year periods through October 10, 2014.

ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS

Exhibit 10.1 - Petroleum Exploration License No. 339/ "Joseph" License Extension Letter (translation)