MMEX Resources Corp (OTCMKTS:MMEX) Get Out While You Can

MMEX Resources Corp (OTCMKTS:MMEX) has loser written all over it. Unfortunately, that's not stopping the pumpers on iHub from hyping this garbage and luring in unsuspecting investors. All it took was one press release saying that the company planned to build a $450 million refinery in the Permian Basin of Texas. We decided to take a look behind the curtain and what we found is not pretty. The chances of MMEX building a $450 million refinery are about as good as MMEX buying Exxon Mobil Corp (NYSE:XOM).We have to admit the press release was a work of art. The use of "plans, intends, subject, expects, and anticipates" was masterful. It was written in true legalese so as the company can say "plausible deniability" when the SEC comes calling. Here's the only paragraph worth focusing on.

MMEX Resources Corp. (OTCPK: MMEX), a global energy company focusing on the acquisition, development and financing of oil, gas, refining and infrastructure projects in Texas and South America, announced today that it plans to build a $450 million, 50,000 barrels per day capacity crude oil refinery in the West Texas Permian Basin, subject to the receipt of required governmental permits and completion of required debt and equity financing.

This all sounds great for a real company, but MMEX has NO money. The latest 10-Q for the period ending October 31, 2016 shows $209 in cash and ZERO in property in equipment. MMEX's assets consists of that $209 in cash. That's it. What the company does have is $2.9 million in liabilities, zero revenues, and a history of losses (over $30 million over its history). MMEX also has convertible notes. From the 10-Q:

On October 9, 2014, convertible notes payable in default to an accredited investor of $1,650,000, $120,000 and $180,000 were assigned to The Maple Gas Corporation, a related party owned by Mr. Jack W. Hanks, a director and officer of the Company. On May 8, 2015, The Maple Gas Corporation converted the notes into 194,999,999 common shares of the Company at $0.01 per share, which resulted in a loss on extinguishment of debt of $975,000. The issuance of the common shares to Maple Structure Holdings was approved by the Company’s Board of Directors Resolution dated May 18, 2015, and the shares were issued on May 2, 2016. At April 30, 2016, common stock payable included an obligation of $2,925,000 for the issuance of the shares.

Yes, this is the same Jack Hanks who is the current President & CEO of MMEX. What's really going on with MMEX is a share issuance scheme. From the 8-K:

Pursuant to the Refinery Transaction, the Company agreed to acquire the Rights in exchange for the issuance of 7,000,000,000 new common shares (the “Purchased Shares”). On March 7, 2017, the holders of more than 50.1% of the outstanding shares of common stock of the Company executed their written consent in lieu of special meeting approving an amendment and restatement of the articles of incorporation to provide for an increase in the authorized shares of common stock from 3,000,000,000 to 10,000,000,000 shares. In addition, the articles of incorporation will be amended to provide for two classes of common shares: (i) Class A Shares, having one vote per share, and (ii) Class B Shares, with 10 votes per share. All of the currently outstanding shares of common stock will be reclassified as Class A Shares, except that all of the Purchased Shares issued or to be issued in the Refinery transaction will be Class B Shares.

Digging deeper and the refinery deal was done with Maple Resources Corporation. From the 10-Q:

MMEX principal shareholders and directors are also principals in a privately held U.S. oil and gas company, Maple Resources Corporation ('Maple") based in Austin, Texas.

Ok, so what about the refinery and what did MMEX acquire? To put it simply, MMEX purchased a business plan. From the 8-K:

Purchaser has developed intellectual property rights related to the Project which include, inter alia, a business plan, cash flow models, a Purchase and Sale Agreement executed for the site location, potential refinery feed stock supplies, water resources, consulting services, refinery technology, potential railroad transportation agreements, management team and other Project development rights and due diligence (the “ Project Intellectual Property Rights”) which the Company identifies as good and valuable consideration in exchange for the assignment of Company shares.

Finally, the signature on the 8-K for the transaction was only Jack W. Hanks. He was the buyer and the seller. The thing is none of this looks illegal. All of it is disclosed in the SEC filings. All an investor had to do was read the filings. Unfortunately, most are just reading the chatter on the iHub message board. No doubt this will get posted by some and deleted by others on the message board, but we're doing this public service anyways. All we can say is buyer beware!We will be updating our subscribers as soon as we know more. For the latest updates on MMEX, sign up below!Disclosure: We have no position in MMEX and have not been compensated for this article.