MMEX Resources Corp (MMEX)

[jmjjw]

Let’s not forget about the misleading, false nature of MMEX’s claims.

Dissecting this for fact:

The developer of a Permian Basin-based refinery is going full-circle with it’s shale oil produced crude. Through a deal with Pilot Thomas Logistics, a national provider of fuel, lubricants and chemicals to multiple industries, MMEX Resources Corp. will sell 100 percent of the diesel produced at its pending Texas crude oil refinery.

First, there is no substantive, corroborating support for this claim. The PR was generated internally at MMEX - Pilot Thomas itself has never issued a single piece of corroborating information.

Second, Pilot Thomas is a distributor - the products that it distributes to the market are manufactured, and sourced from various chemical and transportation grade fuel producers. Pilot Thomas stores them as inventory, and distributes them to end customers. The key here is transportation grade fuel - MMEX could not produce a single drop of transportation grade fuel from Phase I - any claim to that capability is false. As such, for Pilot Thomas to handle any “product” from MMEX, it would have to fund a separate transportation system (tankers), storage (tanks), and racking system.

Factually, and under statute, and regulatory structure, MMEX could not market, or sell any of the AGO it produces as “diesel” all fuel products in PADD III must be ULSD, transportation grade diesel meeting USEPA limitations on sulphur content, and regional limits on cetane number and VOC content.

The 4,200 barrels of diesel set for future production will be sold to Pilot Thomas Logistics who will then provide the fuel to drilling rig operations in the Permian.

This is a provably false claim. No “product” that MMEX could produce from Phase I can be used in any combustion application. It can not be used to “provide the fuel to drilling rig operations in the Permian,” or anywhere.

The only possible use for any AGO MMEX might produce would be make-up fluid in HOBM, which is little used in the region, by a tiny handful of drillers - and this use is niche, on the decline for many valid reasons. There is no business opportunity in this for anyone, let alone Pilot Thomas, who would have to invest millions in facilities to handle the AGO...

“As part of our long-term commitment to providing exceptional service to our customers, we are excited to enter this relationship with MMEX to expand our local supply in the Permian,” said Dennis Cassidy, president and CEO of Pilot Thomas Logistics.

This statement originated in MMEX internally generated PR, and has been parroted in various places - Pilot Thomas itself released no statement of this nature - nothing at all. There is no verification of this claim in any independent source.

Once complete, the Pecos County, Texas-refinery will produce 10,000 barrels per day during phase one of the project. The facility will feature truck and railroad access allowing customers to access the facility quickly.

Another false claim - the 10,000 bpd is name-plate - MMEX will never produce at that rate, and at best might hit 4,000 bpd of AGO, if it ever built anything - a more rational number is about 3,200 bpd, based on the design of MMEX’s Phase I. MMEX’s stranded, isolated facility is in the middle of nowhere - it is more than nine miles by road, Texas Gulf Road, to the nearest state highway, and 70-miles from the nearest producing parts of the Permian. The railroad is deprecated southwest of the facility, and passes no where near productive parts of the region, and to the northeast, it runs for a short distance along a less productive part of the Midland Basin.