Sable Offshore Stock Eyes Worst Day In A Month As Lawsuit Targets Trump Administration’s Pipeline Restart Approval

• Environmental groups filed an emergency court challenge seeking to halt the pipeline restart.
• The lawsuit claims federal approval bypassed required reviews and safety findings.
• Analysts said the legal action was anticipated and kept a positive outlook.

Shares of Sable Offshore Corp. fell sharply on Friday, on-track for their worst day in more than a month, after environmental groups filed an emergency lawsuit seeking to block the restart of a key oil pipeline system in California.

The stock dropped about 14%, reversing part of this week’s rally that followed federal approval to restart the Las Flores Pipeline System, which is central to Sable’s only producing asset.

Environmental Groups Seek To Halt Pipeline Restart

The Environmental Defense Center, the Center for Biological Diversity, and other groups filed an emergency motion in the U.S. Ninth Circuit Court of Appeals to stop the restart of the Santa Ynez Pipeline System.

The lawsuit challenges the Trump administration’s recent approval, issued by the Pipeline and Hazardous Materials Safety Administration, arguing that the decision bypassed required environmental review and public input. The groups also cited a finding by the California State Fire Marshal that additional repairs are needed before the pipeline can safely resume operations.

The pipeline has been shut down for nearly a decade following a 2015 rupture caused by corrosion that led to one of California’s “worst oil spills,” the lawsuit said. 

State And Federal Oversight At Center Of Dispute

The legal challenge comes amid an ongoing jurisdictional dispute. The California Coastal Commission had previously blocked the restart of the subsea pipeline on environmental grounds, while federal regulators determined the system qualifies as an interstate facility subject to exclusive federal oversight.

Earlier this week, the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) approved Sable’s restart plan for pipeline segments CA-324 and CA-325 after reviewing startup procedures and conducting a field inspection. The regulator also reaffirmed that the pipeline connecting the Santa Ynez Unit to the Pentland Station terminal falls under federal authority.

Sable acquired the Santa Ynez offshore production facilities from ExxonMobil and has already restarted production on one offshore platform.

Stock Pulls Back After Approval-Driven Rally

The drop follows a strong move earlier in the week, when Sable shares surged more than 20% after receiving federal approval to restart the Las Flores Pipeline System. That approval was seen as a major step toward restoring production from the Santa Ynez Unit, which produces crude oil and natural gas from platforms off the California coast.

Despite Friday’s selloff, Roth Capital said the legal challenge should not come as a surprise. Roth said it still believes Sable’s pipelines could restart in the near future and reiterated a ‘Buy’ rating on the stock with a $22 price target, even after the sharp decline.

How Did Stocktwits Users React?

On Stocktwits, retail sentiment for Sable Offshore was ‘extremely bullish’ amid ‘extremely high’ message volume.

Sable Offshore’s stock has declined 63% so far in 2025.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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