Sable Offshore Corp. this week said it completed hydrotesting and repairing its pipeline, which the company contends are the among the last conditions to restart oil production at its Santa Barbara County facilities.
“Therefore, no more repairs are required to the onshore pipelines prior to restart,” the company wrote in a SEC filing Tuesday.
A day later, a Superior Court judge in Santa Barbara granted a preliminary injunction to stop Sable from doing work on its onshore pipeline.
The case, involving Sable and the California Coastal Commission, relates to the pipeline work the state alleges was done without the required coastal development permits, and continued after a stop-work order.
Sable sued to challenge the enforcement actions and argued that crews were doing repair and maintenance work covered under existing county permits.
The Coastal Commission filed a cross-complaint asking for a preliminary injunction for future pipeline repair work.
Judge Thomas Anderle issued a ruling Wednesday granting the Coastal Commission’s preliminary injunction, and said the agency had provided “credible evidence of violation of the Coastal Act.”
Sable Plans to Restart Oil Operations
Sable announced on May 19 that it was testing offshore platform wells and plans to restart production and oil sales this summer.
The company also held a secondary public offering for stock last week, an upsized underwritten public offering. Sable sold 10 million shares for $29.50 a share, for a total of $295 million.
The money will be used for “capital expenditures, working capital purposes and general corporate purposes,” according to the May 23 SEC filing.
Environmental groups have been pushing back on the plans to restart production for the offshore platforms, processing facility and transportation pipelines that have been shut down since the 2015 Refugio Oil Spill.
The onshore pipelines changed hands to ExxonMobil and then were transferred to Sable.
Government regulators say more approvals are required to restart the Santa Ynez Unit, Sable’s Santa Barbara County assets.
For one, the Office of the State Fire Marshal said Sable still needs to submit a pipeline startup plan for the agency to review and approve.
Sable published a press release announcing its well testing and oil production plans last week on the 10th anniversary of the oil spill.
In response, State Lands Commission Chair and Lt. Gov. Eleni Kounalakis wrote a letter to Sable expressing her “serious concerns.”
She wrote that the company had mischaracterized its well testing as restarting operations at the Santa Ynez Unit, which caused “significant public confusion and raising questions regarding Sable’s intentions.”
The company was required to tell the SLC before initiating any oil flow through offshore pipelines, which it didn’t, she wrote in the letter.
“Sable’s failure to clearly and timely communicate these activities to the commission undermines trust of Sable’s motives, demonstrates a lack of understanding of the significant concerns held by many regarding the resumption of activities, and raises serious questions about Sable’s willingness to be a transparent operator,” she wrote.
“Any attempt to restart commercial operations at the SYU without final regulatory approvals may place the company in violation of its lease terms and jeopardize the status of Sable’s holdover lease. As chair of the State Lands Commission, it is my expectation that Sable will resolve all pending legal challenges and litigation with other state agencies prior to the full restart of operations.
“The willful disregard for the directives of regulatory agencies does not engender trust or confidence in Sable’s willingness to serve as a responsible partner, and could weigh significantly into considerations on the future assignment of the SYU leases from Exxon to Sable,” Kounalakis wrote.
There are multiple pending lawsuits related to the pipeline restart plans and permits.
