Why Did Sable Offshore Stock Plunge Nearly 27% After-Hours Today?

Sable Offshore (SOC) stock slumped nearly 27% in extended trading on Tuesday after a California judge tentatively rejected its request to restart a pipeline that connects to the Santa Ynez offshore oil project.

Sable had filed a petition at the Santa Barbara Superior Court after the California Coastal Commission blocked the restart of the Las Flores subsea pipeline, which can ship crude from the Santa Ynez to refineries in California. The Houston-based company argued that the state's coastal commission does not have the legal authority to halt the pipeline’s operations.

However, according to a Reuters report, Judge Thomas Anderle in the Superior Court for Santa Barbara County ruled that Sable failed to prove the commission had abused its discretion. Anderle will reportedly hold another hearing on Wednesday before finalizing the decision.

Retail sentiment on Stocktwits about Sable Offshore was in the ‘bullish’ territory at the time of writing.

The Santa Ynez project is the only major project under Sable's portfolio. The company acquired the offshore production facility from Exxon Mobil and began production from one of the three offshore platforms in that project, nearly a decade after it was shut down due to an oil spill.

“SOC has already begun to pivot and use tankers instead. The case will be fought,” one user wrote.

Last week, the company revealed that in the absence of a regulatory permit to restart the pipeline, Sable would load the produced oil into shuttle tankers in federal waters off the coast of Santa Barbara and sell it at various refineries outside of California. The company has sought assistance from the Interior Bureau of Ocean Energy Management to move forward with its tanker strategy.

Sable Offshore stock has fallen 23.8% this year.

Also See: Stellantis Stock Gains 5% After-Hours On Record $13B Investment in America: Retail Bulls See ‘Parabolic’ Momentum Building

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