Sable Offshore Plunged 14% Today – What Is The Feud With California State?

California Attorney General Rob Bonta on Friday filed a lawsuit against the Trump Administration, challenging the Pipeline and Hazardous Materials Safety Administration’s (PHMSA) orders of allowing Sable Offshore’s two pipelines to restart operations.

• Attorney General's petition for review challenges PHMSA’s attempt to evade state regulation through its orders to federalize the Las Flores Pipelines.
• Sable in December had said that it received a receipt of an emergency special permit from PHMSA for Santa Ynez Pipeline System Segments. 
• The onshore pipelines have been shut down for a decade since the 2015 Refugio Beach oil spill. 

Sable Offshore shares plunged more than 14% on Friday after its two California pipeline restart came under scrutiny from a California Attorney General. 

California Attorney General Rob Bonta on Friday filed a lawsuit against the Trump Administration, challenging the Pipeline and Hazardous Materials Safety Administration’s (PHMSA) orders that “illegally assert” exclusive jurisdiction over two California onshore oil pipelines of Sable offshore which are known as the Las Flores Pipelines or lines CA-324 and CA-325, and allow them to restart operations.

Lawsuit Details

Filed in the United States Court of Appeals for the Ninth Circuit, the Attorney General's petition for review challenges PHMSA’s alleged attempt to evade state regulation through its orders to federalize the Las Flores Pipelines, approve Sable Offshore’s restart plan, and issue Sable an emergency permit to restart oil transport through the pipelines.

California Attorney General Rob Bonta, in a statement, said the administration broke the law by reclassifying the Las Flores pipelines last month as "interstate" even though they run between two California counties and are subject to state regulation. 

“In its latest unlawful power grab, the Trump Administration is illegally claiming exclusive federal authority over two of California's onshore pipelines. California has seen first-hand the devastating environmental and public health impacts of coastal oil spills — yet the Trump Administration will stop at nothing to evade state regulation which protects against these very disasters,” Bonta in a statement. 

Sable’s Pipelines

Sable in December had said that it received a receipt of an emergency special permit from PHMSA for Santa Ynez Pipeline System Segments. 

“PHMSA has issued an emergency special permit for segments of the interstate Santa Ynez Pipeline System (specifically segments 324 and 325), approving the Company’s implementation of enhanced integrity management practices and specifying operational conditions,” it said in a statement. 

The onshore pipelines have been shut down for a decade since the 2015 Refugio Beach oil spill, when a corroded segment of one pipeline ruptured and released hundreds of thousands of gallons of oil near Santa Barbara. 

How Did Stocktwits Users React?

Retail sentiment around SOC trended in ‘bearish’ territory amid ‘extremely low’ message volume. 

Shares in the company have fallen 62% over the past 12 months.