MMEX Resources Corp (MMEX)

[jmjjw]

Respectfully, this just isn't how things work.

On the supply side, there are typically two kinds of contracts - short-term spot agreements, that go month-to-month, and long-term take-or-pay agreements.

There are a variety of crude suppliers that range from non-integrated "aggregators," that purchase minimally processed crude from small producers, to vertically integrated producers, like Exxon-Mobil, etc. The small aggregators will enter into agreements on three to six month contracts to provide crude, generally at a higher price, and not including transportation fees. This would force a refiner like MMEX to pay more for feedstock, further negatively impacting its margins by reduction in the crack spread.

It is less likely that a crude supplier or mid-stream entity would enter into a take-or-pay contract with an entity that has no track record, like MMEX. It would be risky, and bad for business on both sides. If MMEX can't pay for whatever reason, they have a potential contract lawsuit on their hands, including arbitration and other delays. What motivation would a supplier have in entering a long-term contract with an unproven customer, with insufficient (or no) financing?

The same issues surround off-take agreements - no end customer would tie their hands to something like MMEX because it creates both supply risk for them, and financial exposure.

Providers of project finance understand these issues, and look carefully at the viability of everyone in the chain, from supplier, through refiner, to the off-take customer (or customers). They generally expect multiple solid supplier relationships (to reduce supply disruption risk), and multiple solid off-take customers (to reduce off-take disruption risk).

Anybody looking at MMEX (if in fact anyone is) would run from this toxic blob - there is simply so much wrong with it, even a high-risk profile investor, or rank amateur financing syndicate can see it. MMEX just stinks.

The Oil Refinery Fairy is providing financing, of course, and Hanks is not required to file an 8K until he makes it known when he is ready to do so. Do you have any proof there is no financing for the build out?
He told you this week on the radio show interview that he was negotiating with companies on the Outtake agreements. You have to have agreements in place that you plan to sell the products to after you produce them. That was made clear yesterday listening to the radio interview if you listened to it yet. It is easier to obtain financing once the financiers see there is a solid agreement in place to sell the products to. When the Outtake agreements are finished being agreed to, we will see the financing.