SANTA BARBARA COUNTY, Calif. (KEYT) – On Monday, California Attorney General Rob Bonta filed a lawsuit challenging the use of a Cold War-era law to force a restart of oil production in Santa Barbara County.
On March 13 of this year, the Trump Administration ordered Sable Offshore, a Houston-based company seeking to restart oil production in Santa Barbara County since 2024, under the authority of the Defense Production Act of 1950 and delegated to the Energy Secretary by Executive Order 13603 "National Defense Resources Preparedness".
"Sable is directed to immediately commence performance under contracts or orders for services, including contracts or orders hereinafter entered into or sought, for hydrocarbon transportation capacity in the SYPS [Santa Ynes Pipeline System] from the point of production in the SYU through the SYPS, including transportation service activities at the onshore facilities in Las Flores Canyon, California, to the Pentland Station terminal in Pentland, California, at which point hydrocarbons move through the Plains All American Line 2000 for transport to refineries," instructed the March 13 order from the Energy Secretary.
The company shared with investors that it has resumed production of hydrocarbons from Platform Harmony and will ramp up to full production from platforms Harmony and Heritage by the end of this month. Platform Hondo is expected to join its sister platforms at full production by June of this year.
Transportation of oil through onshore pipelines across Santa Barbara, San Luis Obispo, and Kern counties has also resumed and sales are expected to start on April 1, 2026, shared Sable Offshore.
"In a breathtaking power grab, the federal Executive Branch has asserted that, with the stroke of a Cabinet Secretary’s pen on an order under the Defense Production Act, the federal government may preempt and supersede all state laws governing hazardous oil pipelines, and any order of a state or federal court, in an effort to extract as much petroleum as it can from the coastal waters off of California," opened Attorney General Bonta's lawsuit filed against Secretary of Energy Chris Wright. "This stunning usurpation of California’s police powers, and the powers of the state and federal courts, should be struck down swiftly and certainly."
In 2024, court documents show that Sable secured a $622,000,000 loan from ExxonMobil to fund the purchase of offshore and onshore oil production infrastructure that is collectively referred to as the Santa Ynez Unit.
Since onshore pipeline Line 901 ruptured in 2015, releasing at least 100,000 gallons of crude oil that spread across 150 miles of California coastline, the pipelines have remained dormant and oversight of their restart has been assigned to the Office of State Fire Marshal through a federal court order.
Line 324's sister pipeline which was also shut down in 2015, Line 325, runs from the Gaviota Coast to Pentland Station in Kern County and was also restarted after the order from the Trump Administration.
In September of last year, Sable Offshore submitted a Request for Approval of Restart Plans, which involved the onshore pipelines, to the California Office of State Fire Marshal in accordance with a federal consent decree agreed to by the previous owner of the pipelines.
The state safety regulator found that there were still outstanding steps required before approving restart the following month.
Instead of conducting the requested safety actions, Sable Offshore instead informed investors in December of last year that it had determined that pipelines connecting the onshore oil processing plant on the Gaviota Coast to Pentland Station in Kern County are technically interstate pipelines under the Pipeline Safety Act and requested that federal regulators take over its restart plans.
The Department of Transportation agreed with Sable Offshore's assessment and promptly asserted its authority over restart plans in mid-December.
In an 8K filing with the U.S. Securities and Exchange Commission in early February, Sable shared with investors that it has not made any additional capitol investments into onshore facilities and pipelines outside of ongoing court proceedings.
"Onshore oil pipelines that run along the Santa Barbara, California, coast and inland to Kern County, California, were shut down in 2015 following a catastrophic rupture that spilled over 120,000 gallons of oil onto Refugio State Beach and into the ocean," noted Monday's lawsuit filed in federal court. "The pipeline operator [Sable Offshore] was unhappy with the speed of those approvals, however—not because they were taking longer than other similarly complex and environmentally sensitive reviews, but because the pipeline operator was severely undercapitalized and desperate to begin generating revenue."
The resumption of oil production plays a crucial role in who will own the oil production infrastructure going forward.
Court documents show that Sable initially secured a $622,000,000 loan from ExxonMobil to fund the purchase of the Santa Ynez Unit from the oil giant.
The line of credit had a pivotal condition.
Ownership of the Santa Ynez Unit would revert back to ExxonMobil unless oil from the Santa Ynez Unit under Sable's management enters the market.
Sable stated in a press release after the ordered restart that it expects to make its first sales of oil on April 1 of this year at an expected gross oil rate of 50,000 barrels of oil per day and therefore, retain ownership of the Santa Ynez Unit going forward.
A spokesperson on behalf of ExxonMobil declined to comment on the change in ownership indirectly facilitated by the Trump Administration when reached for clarification last week and Sable Offshore has not responded to questions about the change in ownership despite multiple requests for more information by Your News Channel.
That facilitation of ownership now directly connected to a forced restart by the Trump Administration was something noted in Attorney General Bonta's lawsuit stating, "Sable was and remains undercapitalized. As a condition of the acquisition, if Sable did not restart production by January 1, 2026, ExxonMobil had the right of reversion."
Regardless of those regulatory hurdles and notable financial interest in a restart, earlier this month the U.S. Department of Justice issued a slip opinion that argued the President, or a designated person, can order Sable Offshore to begin oil production immediately -skirting federal, state, and local regulatory authority- for national security purposes.
"The pipeline operator then relied on the [U.S. Secretary of Energy] Wright Order, and a contemporaneous opinion from the U.S. Department of Justice’s Office of Legal Counsel, to argue that any state laws or existing court orders standing in the way of restart could be ignored and set aside," detailed Monday's lawsuit. "The very next day, on March 14, 2026, the pipeline operator restarted pumping oil through pipelines despite an outstanding preliminary injunction in state court, despite not having necessary permits from either the state or the federal government for pipeline operation, despite still not having approval from several state agencies, and despite not having a current or valid easement to keep or utilize the segment of its pipeline crossing California state property."
Some of that repair work completed last year is also subject to civil charges brought by the California Attorney General and criminal charges brought by the Santa Barbara County District Attorney's Office.
"We just want them to follow the law," argued Sable Offshore CEO Jim Flores during an interview last week on Fox News. "But that doesn't happen in California. You have to defend yourself. And the aspect is, the more of this going on is running so many people out of the state. And we're one of the few people investing in the state and trying to help it."
"[Oil produced in California] is used by the 50 military bases in California, Nevada, and Arizona. And that's the reason why Trump invoked the Defense Production Act," stated Flores, during the same interview with Fox News' Laura Ingraham Thursday of last week. "He has to make sure those military bases and those sailors and airmen and so forth have fuel for their jets and their boats and so on. So it's a real coup to make that our military is well fueled.
Friday's order from the Trump Administration did not explicitly direct crude oil from the Santa Ynez Unit for exclusive military use nor limit its destination to the nation's strategic petroleum reserve.
"Today, more than 60 percent of the oil refined in California comes from overseas, with a significant share traveling through the Strait of Hormuz—presenting serious national security threats," noted the Secretary of Energy in the oil restart announcement on March 13, 2026.
Approximately 20 million barrels of oil transited the Strait of Hormuz each day before the war in Iran started in late February.
Monday's lawsuit noted the stated purpose of the forced restart arguing, "Restarting the flow of oilthrough Lines CA-324/325 does not fix any of these purported problems. Defendants' national defense and national energy emergency justifications are patently unreasoned. To the contrary, the offshore platforms have a maximum expected gross oil rate of 50,000 barrels per day, contributing a fraction of a percent to the domestic energy market. Although international conflict has driven up oil prices globally by reducing oil exports from the Middle East, there is no actual shortage of crude oil in the United States; the incremental oil production the Wright Order directs would thus neither address a shortage (because there is none) nor lower the cost of crude oil in the United States (because this miniscule incremental production would not have an impact on the global price of oil). And even if there were any marginal benefit to the "national defense," it would be vastly outweighed by the environmental and safety risks, as well as the unlawful and unconstitutional displacement of the State’s police powers and the intrusion upon the State's sovereign property rights."
"Indeed, without this Court’s intervention, the Wright Order would permit the federal government to order and authorize the restart of unpermitted and noncompliant infrastructure for oil and gas production and transportation in the State of California," added Attorney General Bonta's filing this week. "Defendants improperly use the DPA [Defense Production Act of 1950] to authorize sweeping preemption of state and federal regulatory frameworks governing oil and gas production and transportation, coastal management, environmental protections, property interests, and more. Such broad preemption is patently unauthorized by the DPA, and the Wright Order amounts to an unprecedented and historic grant of power to an oil corporation."
Monday's lawsuit then specified the following seven allegations.
One, that the Defense Production Act was enacted by Congress to ensure "military preparedness and provide necessary industrial supplies for the national defense", but the statute does not displace judicial nor state power found in other laws, and the latest version of the Cold War-era does not include the right of the President to requisition private property.
Two, the initial pipeline rupture in 2015 was due to faulty maintenance, something the former operator was convicted of nine counts regarding as well as the federal consent decree awarded $60 million in damages and penalties in connection with, and the federal consent decree explicitly included directions concerning a restart due to the construction of the pipelines.
"Investigations determined that Lines CA-324/325's system designed to prevent corrosion used a defective design that could not be remediated," noted the California Attorney General's lawsuit. "Since Sable acquired the Pipelines in 2024, it has consistently demonstrated that it is willing to cut corners and disregard legal compliance in its crusade to return to production to dig itself out of a financial hole."
"Sable’s precarious financial position dictated that it prioritize restarting the pipelines quickly, above all else. Shortly after the acquisition, Sable began its venture to restart oil production at the Santa Ynez Unit, transport crude oil through Lines CA-324/325, and sell the oil commercially. In order to do so Sable ultimately opted to repair instead of replace the pipelines," added Monday's lawsuit. "Defendants' [U.S. Department of Energy] unprecedented act of government assistance to a single struggling oil company endangers the health and safety of California’s residents and the environment."
Three, the forced restart order was issued by the Trump Administration based on a request from Sable Offshore.
To wit, conversations referenced but not disclosed in court documents between federal regulators and the Houston-based energy company were requested and have been granted as part of an injunction imposed by Santa Barbara County Superior Court Judge Donna Geck and upheld just last week.
Litigants in that case are due back in court next month.
Additionally, public claims made back in May of last year by Sable Offshore and the Trump Administration about already restarting oil production may have violated leases issued by the California State Lands Commission.
"This is a significant achievement for the Interior Department and aligns with the Administration's Energy Dominance initiative, as it successfully resumed production in just five months," stated the U.S. Department of Interior in July of 2025. "With production now underway at Sable's Platform Harmony, the Interior's Bureau of Safety and Environmental Enforcement (BSEE) continues to work with Sable to bring additional production online."
Sable eventually walked back those restart claims to investors explaining in a disclaimer that, "The Santa Ynez Unit assets discussed in this [May 19, 2025] press release have not sold commercial quantities of hydrocarbons since such Santa Ynez Unit assets were shut in during June of 2015 when the only onshore pipeline transporting hydrocarbons produced from such Santa Ynez Unit assets to market ceased transportation. There can be no assurance that the necessary approvals will be obtained that would allow the onshore pipeline to recommence transportation and allow the Santa Ynez Unit assets to recommence sales."
Four, Secretary Wright's order directly violates the wording of the Defense Production Act.
Monday's lawsuit alleged that, "the Wright Order does not say, and no public information indicates, that Sable holds a Title I government contract or that Sable is required to sell its crude to the government in a Title 1 contract. The Wright Order also fails to state where, or to whom, Sable will sell the crude oil it produces."
"The Wright Order also does not attempt to articulate why the pipelines, in particular, are critical to the national defense," added the lawsuit. "The Wright Order also does not allege that Sable is part of a national energy program or a national defense program...The Wright Order also fails to provide any rational basis that connects how ordering Sable to "require acceptance and prioritize performance" of"contracts" or "allocations" would promote the national defense with respect to energy. The Secretary fails to rationally explain why the Wright Order only favors Sable, nor does it provide any credible information to support the restart of Sable’s pipeline in a manner that is "immediate" and circumvents state and federal law, as well as existing court orders."
Five, the order attempts to displace state law without explanation.
"Secretary Wright's use of the DPA to broadly authorize preemption of state law in the Wright Order is contrived, in direct conflict with the statute, and without lawful and reasoned explanation," Monday's lawsuit stated.
Six, the order also displaces federal law and judicial orders from federal and state courts.
"The Wright Order, if allowed to stand, purports to subvert a vast array of long-standing federal laws, a federal judicial Consent Decree, and a state preliminary injunction that put conditions on any restart of the Pipelines," argued the lawsuit. "The DPA contains no provision that allows it to direct Sable to circumvent federal law, the Consent Decree that arose from the devastating Refugio Oil Spill and pipeline safety problems from the Pipelines, or the state court’s preliminary injunction."
Seven, the order poses a risk to Californians.
"The Wright Order is an affront to, and usurpation of, the traditional police powers delegated to the states, in that it seeks to override any and all California laws that stand in the way of the restart of the Pipelines. The Wright Order also tramples over California’s property rights to the extent it purports to allow Sable to operate Line CA-325 through a state park without an easement—or the safety and environmental conditions the Department of Parks and Recreation previously imposed under a now-expired easement—and to operate the Offshore Pipeline through leases from the California State Lands Commission without abiding by lease terms, including those mandating compliance with all other statelaws."
Monday's lawsuit then requests that federal courts issue a judicial declaration stating the forced restart order is either unconstitutional or unlawful, vacate the order under federal law, and prohibit continued operations at the Santa Ynez Unit under the exclusive authority of the federal order.
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