In reviewing Mad J.’s latest rehashed, recycled, regurgitated shart-holder B.S. letter, there’s this gem:
Product Off-Take Agreements. We have signed a diesel off-take with Pilot Thomas Logistics for sale of the diesel at our plant tailgate. We are down to the final terms with an international oil and trading company to purchase both our naphtha and residual fuel oil, and we have been negotiating terms sheets and contracts since November 2018. The products are being purchased FCA our plant tailgate and being transported by rail to the client’s Texas Gulf Coast destinations.
The “residual fuel oil” Mad J. claims to plan on producing is a problem - the rudimentary topping unit can’t produce anything marketable as residual fuel oil - it could only produce atmospheric tank bottoms (ATB), sometimes known as atmospheric residuum (AR), bottoms, or “resid.”
ATB is the least valued of all refining products, because there is no direct use for it. ATB must be further processed, usually by a combination of vacuum distillation (MMEX-scam’s topping unit has no such capability), and cracking.
ATB is more viscous, and has a lower API number than the crude from which it was sourced. It requires specialized handling, because at room temperature, it won’t flow. This adds cost to handling it; storing it, trying to push it through process piping, or to transport it by pipeline, rail, or OTR tanker are all very expensive, making it impossible to profitably transport. Mad J. would be wrapping every single of ATB produced in dollar bills, and further paying someone capable of processing it to haul it off.
There is no fuel use for ATB, it cannot be combusted in any marine or land-based system for any purpose, because of sulphur and metal contamination.
So, once again we find Mad J. caught in another big lie.
Mad J.’s little teapot topping unit couldn’t produce naphtha either - it would fraction only light gas oil (LGO). As has been documented ad nauseam, Mad Little Jacki-boi’s teapot topping fantasy can’t produce any product known as diesel either - it could only generate atmospheric gas oil (AGO). None of the output streams from Mad J.’s topping unit have any direct market - no where. The cost to transport and haul them out of Mad J.’s little piece of desert paradise would erode any possible profit margin, resulting in loss on every single drop the tiny teapot fantasy might produce.
Unfortunately for retail “investors,” lacking sector knowledge, or any basic knowledge of refining processes don’t understand this - so they got scammed out of their monies by Mad J.’s fancy talking.
MMEX - You’ve Been Scammed!