Sable Offshore restarts oil, eyes 50,000 bbl/d

Defense Production Act order routes Sable crude through a key pipeline, with first sales by April 1 at 50,000 bbl/d and plans to refinance its term loan.

Mar. 16, 2026 at 10:38am

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Sable Offshore Corp. announced that it has resumed the transportation of hydrocarbons (oil) produced at the Santa Ynez Unit through the federally regulated and approved Santa Ynez Pipeline System, following a Defense Production Act order issued by the U.S. Secretary of Energy. The company plans to commence first sales by April 1, 2026 at an expected gross oil rate of 50,000 Bbls/d and is pursuing financing options, including federal credit support, to refinance its Senior Secured Term Loan.

Why it matters

The restart of oil production and transportation from Sable's Santa Ynez Unit is significant as it aims to increase domestic supply of crude oil into the California market by approximately 17%, addressing energy scarcity and supply disruption risks in the region. The use of the Defense Production Act highlights the federal government's efforts to ensure energy security and support domestic oil production.

The details

Sable Offshore Corp. resumed the transportation of hydrocarbons (oil) produced at the Santa Ynez Unit through the federally regulated and approved Santa Ynez Pipeline System on March 14, 2026, following a Defense Production Act order issued by the U.S. Secretary of Energy. The company plans to commence first sales by April 1, 2026 at an expected gross oil rate of 50,000 Bbls/d. Sable is also pursuing financing options, including federal credit support, to refinance its Senior Secured Term Loan and deploy its commodity hedging program.

  • On March 13, 2026, President Donald J. Trump signed an Executive Order to delegate certain authorities under the Defense Production Act of 1950 to the U.S. Secretary of Energy.
  • On March 13, 2026, the U.S. Secretary of Energy, Chris Wright, issued an order to Sable invoking the Defense Production Act to immediately prioritize and allocate pipeline transportation services for hydrocarbons from the Santa Ynez Unit.
  • Sable resumed hydrocarbon transportation from Las Flores Canyon to Pentland Station on March 14, 2026.
  • Sable plans to commence first sales by April 1, 2026.
  • Sable plans to fully resume production at Platforms Harmony and Heritage this month, in March 2026, and Platform Hondo in June 2026.

The players

Sable Offshore Corp.

An independent oil and gas company, headquartered in Houston, Texas, focused on responsibly developing the Santa Ynez Unit in federal waters offshore California.

Chris Wright

The United States Secretary of Energy who issued the Defense Production Act order to Sable.

Donald J. Trump

The President of the United States who signed an Executive Order to delegate certain authorities under the Defense Production Act of 1950 to the U.S. Secretary of Energy.

Pacific Pipeline Company (PPC)

A company that sued the California Department of Parks and Recreation along with Sable Offshore Corp. to confirm their rights under the Defense Production Act order.

Armando Quitero

The Director of the California Department of Parks and Recreation, who was named as the defendant in the lawsuit filed by Sable Offshore Corp. and Pacific Pipeline Company.

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What they’re saying

“Sable Offshore is putting California consumers first by increasing domestic supply of crude oil into the California market by approximately 17% and we look forward to continuing to execute as so ordered by the Defense Production Act executed on March 13, 2026.”

— Jim Flores, Sable's Chairman and Chief Executive Officer (Business Wire)

What’s next

The judge in the case will decide on whether to allow Sable and Pacific Pipeline Company's lawsuit against the California Department of Parks and Recreation to proceed.

The takeaway

The federal government's use of the Defense Production Act to restart oil production and transportation from Sable's Santa Ynez Unit highlights the importance of ensuring energy security and supporting domestic oil production, even in the face of potential state-level opposition.