Sable Offshore Warns It Could Stop Operations as Chevron Halts Buying
Sable Offshore Corp. said in a November 9 filing that there is substantial doubt it can keep operating after its only crude buyer, Chevron, paused purchases in October. Shares fell 60.5% to a record low of 76 cents on Monday.
Sable Offshore Corp., the Houston-based company that restarted the Santa Ynez Pipeline off the Santa Barbara coast, said in a November 9, 2026 filing that it could stop operating within a year. Its sole crude buyer, Chevron, has paused purchases. Sable is in survival mode.
The company's shares fell 60.5% on Monday to 76 cents, an all-time low, after it disclosed "substantial doubt" about its ability to continue as a going concern.
Oil sales stopped in October
Chevron curtailed its purchases on October 6, 2026, the filing said, citing maintenance and upgrades to storage tanks at its refinery. The work was expected to be resolved promptly. The pause lasted all month and is still going on, Sable said.
With nowhere to send its crude, Sable cut production so its own storage would not overflow. Chief executive Jim Flores told investors the company went two and a half weeks in October without any crude sales.
"As a result of these developments, the Company does not expect to have sufficient liquidity to meet its obligations as they become due in the near term," Sable said in the filing.
The company still expects Chevron to resume buying. It said the timing and volume of any restart are uncertain.
Other buyers and cash options
Since early November, Sable has sold oil to three other Los Angeles-area refineries. It said it expects all four major refineries in the area to increase their purchases of crude from the Santa Ynez Unit, its group of offshore platforms, over time.
Sable is also weighing a bulk sale of the crude it holds in inventory. It is exploring new share sales and borrowing from lenders as well. The company said it is evaluating all options to resolve near-term working capital constraints.
It said physical inspections on Platform Hondo and initial production there are scheduled for November. Sable expects Hondo's lighter, lower-sulfur crude to improve the overall quality of its oil.
A contested restart
Sable announced the restart on March 16. The pipeline had not carried oil since 2015, when it failed because of severe corrosion and caused one of the worst oil spills in California history. Oil reached Refugio Beach.
In March, US Energy Secretary Chris Wright ordered Sable, under the Defense Production Act, to prioritize transporting oil from its platforms, citing national defense. California sued to overturn the order.
In October, environmental groups, members of Congress, legal experts, business leaders and 20 other states filed briefs backing California in the Ninth Circuit Court of Appeals. The federal government argues courts cannot review the order. Environmental groups say the restart is unsafe and unlawful.
Flores acknowledged the planned diversification of customers had not been done in time. "Obviously, in October, it blew up in our face, and we're very apologetic to that," he said on the investor call. "I would think after 45 years I should know better. But I kind of fell asleep because of our close relationship there."
