Sable Offshore Corp said Wednesday the Santa Barbara Superior Court had issued a tentative ruling indicating the court would deny the company’s claims against the California Coastal Commission (CCC), in a permitting dispute over repairs on the Santa Ynez Unit (SYU) pipeline system.
However, Houston, Texas-based Sable insisted even if the court decision becomes final, “the ruling would have no impact on the resumption of petroleum transportation through the Las Flores Pipeline System”.
“Additionally, oil and gas production from the federal Santa Ynez Unit and the flow of petroleum from the Santa Ynez Unit to the Las Flores Canyon processing facilities or to a potential offshore storage and treating vessel (OS&T) would be unaffected by rulings in the Coastal Commission litigation”, it said in a statement on its website.
SYU is Sable’s sole operation. SYU ceased flows 2015 after an oil spill that, according to the CCC, released 123,000 gallons of oil and caused environmental damage to 150 miles of coastline. SYU was then owned by Plains Pipeline LP, which sold it to Exxon Mobil Corp 2022. Sable acquired SYU from ExxonMobil February 2024.
Nonetheless Sable plans to escalate such a final judgment by the Superior Court to the California Court of Appeal.
“Sable is suing the Coastal Commission for the damages it has caused Sable by erroneously issuing cease and desist orders during Sable’s anomaly repair program on the Las Flores Pipeline System”, the statement said.
“The anomaly repair program and hydrotesting of the Las Flores Pipeline System was [sic] completed in May 2025 in accordance with the Federal Consent Decree.
“Sable intends to continue its pursuit of the writ of mandate in the Court of Appeal as well as declaratory relief and inverse condemnation claims in excess of approximately $347 million”.
Sable added it “continues to work diligently with the State of California to safely and responsibly resume petroleum transportation through the Las Flores Pipeline System in accordance with the Federal Consent Decree”.
Sable chair and chief executive Jim Flores commented, “California has an opportunity to authorize the resumption of petroleum transportation through the Las Flores Pipeline System per its obligations in the Federal Consent Decree and lower gasoline prices for California residents”.
“California’s economy will face dire consequences if refineries continue to close due to the lack of domestic production, which should be a major concern for the bondholders of the State of California”, Flores added.
The CCC has yet to reply to Rigzone’s comment request.
On September 29 Sable said it had filed a request before the California Office of the State Fire Marshal to restart the Las Flores Pipeline System, warning it would opt to divert oil flows outside the state if delays continue.
Sable said it had “satisfied all operational conditions to resume petroleum transportation through the onshore pipeline”.
“Among these satisfied conditions are anomaly repairs, safety valve installations, control room enhancements and the production of all supporting documentation and analyses”, Sable said.
“Continued delays related to the onshore pipeline will prompt Sable to fully pivot back to a leased OS&T strategy, which was utilized to process SYU production in federal waters from 1981-1994”, it warned.
“The onshore pipeline provides immediate economic relief to California residents and will play a large role in stabilizing local refineries”, Sable said.
“In the second option, the company would have the freedom to market its production outside of the state of California.
“Additionally, Sable would plan to aggressively pursue all legal remedies. Sable will continue to pursue both paths in parallel.
“In the OS&T option, the company expects to execute an OS&T lease contract by year-end 2025 for delivery in Q3 2026. Sable would then expect to begin sales from all SYU platforms during Q4 2026 with expected comprehensive oil production rates of over 50,000 barrels of oil per day utilizing the OS&T within the SYU federal leases”.
On November 12, 2024, the CCC issued a Cease and Desist Order (CDO) against activities to reactivate the pipeline system, citing “unpermitted development”. The CCC argued Sable was conducting pipeline works without having undergone the commission’s authorization process.
On March 12, 2025, Sable announced a suit against the CCC before the Superior Court in Santa Barbara County asking for “damages and declaratory and injunctive relief to protect its vested rights to repair, maintain and operate the Santa Ynez Unit and Las Flores Pipeline Systems”. Sable said it had obtained consent from the county government that supports the company’s view that repair works are covered by the pipeline system’s existing permits and do not need a new or separate Coastal Act authorization.
On April 10, 2025, the CCC issued a second CDO, ordered Sable to restore environmental damages from the allegedly unauthorized works and imposed administrative penalties. The CCC insisted the Consent Decree between Sable and the local government does not constitute a permit and does not exempt Sable from state and local laws and permits.
To contact the author, email jov.onsat@rigzone.com
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