SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
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Date of Report: January 18, 2001
ISRAMCO, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-12500 13-3145265
(State or Other Jurisdiction Commission File IRS Employer
of Incorporation) Number Identification No.
11767 Katy Freeway, Houston, Texas 77079
(Address of Principal Executive Offices)
713-621-5946
(Registrant's Telephone Number, including Area Code)
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INFORMATION TO BE INCLUDED IN THE REPORT
ITEM 5. Other Events
The Board of Directors elected to abandon the Tilapia Permit in the Congo
(hereinafter, the "Tilapia Permit"), in which the Company held a 50%
participation interest. The decision to abandon the Tilapia Permit in the Congo
follows the license participants' decision in December 2000 to abandon and plug
the onshore well Tilapia-1. The acquisition cost to the Company of the Tilapia
Permit was reflected on the Company's books at December 31, 1999 at
approximately $2.55 million. The aggregate amount expended by the Company to
date in connection with the Tilapia Permit (including the foregoing acquisition
costs) is estimated at $4.4 million, which the Company anticipates may be
charged against taxable revenues.
The Company intends to, however, continue its presence in the Congo. The
Company entered into an agreement with Naphtha Israel Petroleum Corp. Ltd.
("Naphtha Israel") and I.O.C. Israel Oil Company Ltd. ("IOC"), each an
affiliated entity and a limited partner in Naphtha Congo (1995) Limited
Partnership, another affiliated entity (hereinafter, the "Congo Limited
Partnership"), to purchase each of Naphtha Israel's and IOC's respective
interests in the Congo Limited Partnership. The Congo Limited Partnership holds
a 5% working interest in the "Marine 9" license located off-shore Congo
(hereinafter, the "Marine 9 License"). Following the purchase, the Company will
be the sole limited partner in the Congo Limited Partnership and will hold 99.9%
of the Congo Limited Partnership's rights and interests in the Marine 9 License.
The remaining participants in the Marine 9 License are recognized well-known oil
companies. The general partner of the Congo Limited Partnership will remain
Naphtha Congo Ltd., an affiliated entity.
The interests will be purchased for a total consideration payable by the
Company of $800,000 and an undertaking to pay royalties to the sellers (and/or
their designees) from net revenues generated therefrom at the rate of 17.5% of
such revenues. In connection with this acquisition, the Company received a Fair
Market Value Letter from an independent petroleum engineer with regard to the
interests being purchased in the Congo Limited Partnership.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: January 18, 2001 Isramco, Inc.
By: /s/ Haim Tsuff
Haim Tsuff
Chairman of the Board
