MMEX Resources Corp (OTCMKTS:MMEX) is a story that we were very negative on when the stock was trying to punch above 4-5 cents. We said it was a sub-penny stock with a ton to prove. However, about a month ago, I wrote a piece on this one highlighting the most important possible signal: it would appear that the company spent some money. If true, it starts to signal some credibility in a situation that badly needs it.
The latest from the company may augment things in that direction: the company just announced it has secured permit approval from the Texas Commission on Environmental Quality (TCEQ) to build a 10,000 barrel-per-day (BPD) crude distillation unit near Fort Stockton, Texas. While this isn’t spending money, it does at least make good on one of the company’s smaller promises. Make no mistake: this could very well still be headed toward a farcical outcome principally about dilution and fantasy (we firmly do not believe a half-billion-dollar refinery will be built and operated by the company), but recent releases create potential for the story to shape into something that can offer some opportunities over time. That said, we still urge caution given the number of key red flags we have noted in the past with this one.
MMEX Resources Corp (OTCMKTS:MMEX) frames itself as a mining development Company leveraging global demand for mining assets located in the Americas. The company was formed to engage in the exploration, extraction, refining and distribution of oil, gas, petroleum products and electric power.
MMEX focuses on the acquisition, development and financing of oil, gas, refining and electric power projects in Texas, Peru, and other countries in Latin America.
The company’s management team apparently has extensive experience with natural resource project development and project financing in North and South America. MMEX is initially focusing on opportunities in Colombia and Peru. Moreover, MMEX Resources Corporation focuses on the exploration, extraction, refining, and distribution of oil, gas, and petroleum products in the United States and Latin America. It also intends to provide electric power.
MMEX Resources Corporation was formed in the State of Nevada on May 19, 2005 as Inkie Entertainment Group, Inc.
Subsequently, MMEX amended its articles of incorporation to change its name to MMEX Resources Corporation and to authorize the Company to issue up to 3,000,000,000 common shares and 10,000,000 preferred shares. We have seen massive and dilutive share creation in this stock already, and we have strong reason to believe that will only accelerate from here.
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One interesting dimension to the story at this point is the ramifications of Hurricane Harvey, which just slammed into Texas a week ago, shutting down nearly a third of all refining capacity in the US. That drove the price of RBOB gasoline futures over 20% higher in 48 hours. It’s certainly a reminder of the need for more refining capacity.
Jack W. Hanks, President and CEO of MMEX Resources Corp., commented, “MMEX joins with its strategic partners, Trinity Consultants, its environmental consultants, and VFuels, its design and engineering firm, in announcing that TCEQ has approved the MMEX air permit application, allowing construction to begin. The efficiency of the permitting process speaks volumes to the professional approach of all parties in the application preparation and technical review process, including TCEQ staff and administration.”
The chart shows 46% tacked on to share pricing for the company in the past month, but this action is running counter to the larger trend in the name. Market participants may want to pay attention to this stock. MMEX has evidenced sudden upward volatility on many prior occasions. In addition, the company has seen interest climb, with an increase in recent trading volume of a bit over 130% beyond what we have been seeing over the larger time frame.
Earning a current market cap value of $24.3M, MMEX has virtually no cash reported on the books, which is balanced by about $716K in total current liabilities. The company is pre-revenue at this point. We will update the story again soon as developments transpire. Sign-up for continuing coverage on shares of $MMEX stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: We hold no position in $MMEX, either long or short, and we have not been compensated for this article.