The judge conditionally blocks Sable’s bid to restart the pipeline

from Alejandro LazoCalMatters

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A Santa Barbara judge intends to rule against Sable Offshore Corp.’s proposal. to restart a pipeline that spilled thousands of barrels of crude oil into the Pacific Ocean 11 years ago — dealing a significant blow to the company’s attempt to use the Trump administration to sidestep California regulators along the way.

In a advance decisionSanta Barbara County Superior Court Judge Donna D. Geck said the Trump administration’s intervention was not enough to overturn its earlier order to stop the pipeline. The decision – a preliminary ruling signaling how the judge intends to rule unless convinced otherwise – comes ahead of a hearing on Friday.

The Houston-based startup, which bought the system from ExxonMobil in early 2024, secured emergency intervention from the Trump administration last year to wrest oversight of the pipeline from California regulators who had blocked its path.

Sable declined to comment on the preliminary ruling. In an earlier statement, Steve Rush, the company’s vice president of environmental and government affairs, said the project would “offer Californians immediate relief at the pump by making gas more affordable” and that the company has the experience to operate safely.

The company faces prosecution by the local district attorney, a federal securities investigation, two injunctions and findings by county officials of a pattern of noncompliance.

Trump steps in to federalize pipeline

When state regulators told Sable it had to fix corrosion on the pipeline last fall, the company turned to Washington.

About a month later, Sable asked federal regulators to declare the pipeline “interstate,” a designation that would transfer authority from the California State Fire Marshal’s Office to the federal government. The company cited a January 20, 2025 announcement by President Donald Trump declaration of a national energy emergency.

On Dec. 17, the Pipeline and Hazardous Materials Administration agreed, ruling that the Las Flores pipeline — two onshore oil pipelines running from Santa Barbara County to Kern County — qualifies as an interstate pipeline because it starts on federal offshore platforms and ends at a refinery in Kern County. The agency noted that the pipeline was under federal oversight prior to 2016. Six days later, the agency issued an emergency permit approving a plan to restart. The agency declined to comment.

The maneuver caused an immediate conflict. A 2020 federal consent decree stemming from the 2015 spill requires approval from California’s state fire marshal before the pipeline can restart — a condition that appears to be in direct conflict with the Trump administration’s decision to strip the fire marshal of his authority.

Environmental groups sued the Trump administration in Decembersaying it “grossly violates transparency, environmental review and pipeline safety requirements.” California filed his own lawsuit in January. Christine Lee, a spokeswoman for Attorney General Rob Bonta, said the Trump administration’s “unlawful actions” violated the consent decree and sought to avoid government oversight.

Both cases were consolidated earlier this month and await a decision in the 9th Circuit Court of Appeals. The Justice Department declined to comment.

“This is a real encroachment on state power here that shouldn’t stand,” Julie Teal Simmonds, an attorney with the Center for Biological Diversity, said before the judge’s initial ruling was issued Thursday. “They’re basically trying to seize control of these pipelines.”

The first major domestic test

Geck’s order, issued last July, prohibits Sable from restarting the pipeline until it secures all necessary state approvals, including those from the fire department. The order derives from a court case filed by the Center for Biological Diversity and the Environmental Protection Agency, which alleges the firefighter violated the state Pipeline Safety Act by issuing a restart exemption without requiring an environmental review.

On Jan. 5, Sable asked Judge Geck to lift her ban, arguing that with federal regulators taking control, the state fire marshal “no longer has any regulatory authority.”

In his preliminary ruling, Geck disagreed.

Linda Kropp, an attorney with the Environmental Defense Center, said the interim ruling includes the 2020 consent decree that binds Sable, federal regulators and the state fire marshal.

“It’s still binding,” she said.

At the heart of the dispute is corrosion — and how tight the safety strip needs to be before oil can flow again. State regulators permanent repairs required on any section of pipe showing severe thinning of the walls, including spots which could be considered dangerous after allowance for inspection error.

In its preliminary ruling, Geck sided with the state, finding that the federal action was insufficient to overturn its order.

Sable will have a chance to challenge that finding at Friday’s hearing. The company has argued that it had already completed the necessary repairs and argued that these stricter standards were intended to apply only after the pipeline was restarted, not before.

The fight carries significant economic and environmental stakes.

Sable has told investors that production could rise from about 30,000 barrels of oil equivalent per day to more than 50,000, with oil flowing to refineries in Los Angeles, Bakersfield and San Francisco. The company told CalMatters this week that it could serve 20 percent of the state’s market, an attractive opportunity because California recalibrated its energy strategy to strengthen fossil fuel infrastructure even as it seeks cleaner energy.

But state water officials and the Coastal Commission say the pipeline crosses environmentally sensitive coastal areasand environmental groups say the corrosion risks that caused the Refugio spill in 2015 make close inspection essential.

Sable says it has upgraded monitoring systems and strengthened emergency shutdown protections on the line, plans to inspect the pipeline more often than federal rules require and has response teams deployed for rapid deployment, according to a company spokesman.

UC Santa Barbara analysis found that the restart would not reduce foreign imports and would increase global greenhouse gas emissions due to the higher carbon intensity of the project.

The remaining blockades

Multiple state and federal hurdles still stand between the company and a restart.

A second injunction issued by Judge Thomas Anderle, also in Santa Barbara County Superior Court, bars operating under state coastal law without a permit from the California Coastal Commission.

That order stemmed from a separate case of unauthorized work along the Gaviota coast — conduct that state officials call part of a broader pattern of noncompliance. Commission last year imposed a record fine of $18 millionwhich Sable disputes.

A new state law, Senate Bill 237, requires oil facilities to be idle for five years or more to receive a new coastal development permit. A section of the pipeline crosses Gaviota State Park, and state officials say they cannot grant a new easement without completing an environmental review.

The Santa Barbara County Board of Supervisors last year rejected Sable’s request to take over ExxonMobil’s work permits, also citing a pattern of noncompliance. District attorneys have also charged Sable with multiple counts related to alleged unauthorized excavation and dumping during work on the pipeline in 2024 and early 2025. That criminal case is ongoing.

Sable’s shrink track

Even if Sable overcomes its legal hurdles, time may prove to be the biggest obstacle.

The company disclosed in a recent securities filing that there was $97.7 million in cash and cash equivalents as of the end of last year and will need to spend $25 million to $30 million a month to stay afloat this year. He said he plans to seek up to $250 million through a stock sale.

Financial pressures are compounded by a weaker oil market than the company expected when it pitched to investors, said Clarke Williams-Derry, an analyst at the Institute for Energy Economics and Financial Analysis. Crude oil prices remained well below earlier forecasts, tightening the economics of the project and leaving less room for delays.

“The company … is burning through cash,” Williams-Derry said. “He’s facing much higher costs — and a much slower schedule — than he originally anticipated.”

Sable proposed a backup plan to bypass the onshore pipeline and export the oil by offshore tankers, a proposal that drew fierce opposition in California.

The pipeline fight comes as the Trump administration moves to expand offshore oil leasing along the West Coast, a move that has drawn fierce opposition in California. Geck’s interim ruling is the first sign that federal efforts to roll back state power may face resistance in court.

“If Sable ends up not being able to build this — or reopen that pipeline — I think it will just be confirmation that state and local governments have a say,” said Deborah Sivas, a Stanford environmental law professor. “It’s just going to confirm that the feds can’t come in and force things on states and local residents.”

This article was originally published on CalMatters and is republished under Creative Commons Attribution-NonCommercial-No Derivatives license.