Oil company fined record $18 million for defying state orders to stop work on pipeline

Associated Press

11-04-2025

The California Coastal Commission fined an oil company a record $18 million on Thursday for repeatedly defying orders to stop work on a corroded pipeline in Santa Barbara County that caused a major oil spill nearly a decade ago.
The vote sets the stage for a potentially high-stakes test of the state's power to police oil development along the coast. The onshore pipeline in Gaviota gushed more than 100,000 gallons of crude oil onto coastal land and ocean waters, shutting down fisheries, closing beaches and harming marine life and coastal habitats in 2015.
Sable Offshore Corp., a Houston-based company, purchased the pipeline from the previous owners, Exxon Mobil, last year, and is seeking to restart the Santa Ynez offshore oil operation.
The Coastal Commission said Sable has done something no alleged violator has ever done before: ignoring the agency's multiple cease-and-desist orders and continuing its work.
'Our orders were valid and legally issued, and Sable's refusal to comply is a refusal to follow the law,' said Commissioner Meagan Harmon, who also is a member of the Santa Barbara City Council. 'Their refusal, in a very real sense, is a subversion of the will of the people of the state of California.'
The company argued it can proceed using the pipeline's original county permit issued in the 1980s. In February, Sable sued the Coastal Commission saying the state is unlawfully halting the company's repair and maintenance work.
At a 5-hour public hearing in Santa Barbara, more than 100 speakers lined up, many of them urging the commission to penalize Sable and stop its work. Some invoked memories of the 2015 Refugio Oil Spill as well as the massive 1969 Santa Barbara oil spill caused by a blowout on a Union Oil drilling rig. Public outrage over that spill helped shape the environmental movement, led to the first Earth Day and contributed to the enactment of many national environmental laws.
'I've never taken how special this area is for granted,' said Santa Barbara County resident Carol Millar. 'As a kid, I was traumatized by the '69 oil spill, and in 2015, I had to watch my own kids go through the same trauma.'
Steve Rusch, Sable's vice president of environmental and governmental affairs, said the commission was overreaching because of the spill caused by the previous owners.
'We are proud of our good-paying, skilled jobs that our project has brought to the region,' he told commissioners. 'It's not about the 2015 Refugio oil spill. It's not about the restart of the pipeline …it's not about the future of oil production or fossil fuel in California.'
In repairing the former, corroded pipelines, the company is seeking to restart production of the Santa Ynez oil operation, which includes three offshore rigs, according to an investor presentation by the company. Operations stopped after the 2015 spill.
Sable had been excavating around the former pipelines and placing cement bags on the seafloor below its oil and water pipelines.
The Coastal Commission's fine levied against Sable is the highest ever levied against a company, according to a commission spokesperson. The commission voted to lower the $18 million fine to potentially just under $15 million if Sable complies with the state's orders and applies for a coastal development permit.
In addition to the penalty, the commissioners voted to order Sable to cease its work and restore land and offshore areas, including replanting vegetation and erosion control, where the unauthorized work occurred.
Beginning last year, commission staff charged the company with multiple violations of coastal laws, including unpermitted construction and excavation using heavy equipment along the 14-mile oil pipeline on the Gaviota Coast, including in waters offshore.
The enforcement division of the commission said Sable undertook major work at multiple locations without securing the required coastal development permits.
The company dug large pits, cleared vegetation, graded and widened roads, placed cement and sandbags in ocean waters and drained water sources, among other damage, according to a staff presentation. Commission staff said these actions went beyond routine maintenance and amounted to a full rebuild of the pipeline.
Coastal Commission officials emphasized that the work posed serious risks to the environment, including wetlands and other sensitive habitats, potentially harming protected species, including western pond turtles and steelhead.
'The timing of the implemented development is particularly problematic, as much of this development has been during bird nesting season, as well as red-legged frog breeding season and Southern Steelhead migratory spawning season,' said Stephanie Cook, an attorney with the commission. 'This work has a high potential to adversely impact these habitat areas.'
The staff said it spent months trying to get Sable to cooperate but the company provided incomplete or misleading information.
Rusch, in a statement issued after the hearing, said the company is conducting routine pipeline repair and maintenance, and said the actions were allowed under old permits issued by Santa Barbara County. The work is taking place in areas already affected by previous construction and use, and the company says the state cannot override the county's interpretation of its permits.
'Sable is dedicated to restarting project operations in a safe and efficient manner,' Rusch said in the statement. 'No California business should be forced to go through a protracted and arbitrary permitting process when it already has valid permits for the work it performed.'
However, the validity of the county permit for the pipeline is in dispute. The Santa Barbara County Board of Supervisors in a February vote did not approve transferring the county permit to Sable, the new owner. The vote was 2-2, with one member abstaining because the pipeline runs through her property. County officials are still trying to decide their next step.
One concern of county officials is whether Sable has the financial ability and adequate insurance to handle a major oil spill.
The pipeline dispute comes as the Trump administration moves to boost domestic oil and gas production while sidelining efforts to develop wind and solar.
Several workers who said they were affiliated with the company spoke out in support along with others who said the company would boost the local economy.
Evelyn Lynn, director of operations at Aspen Helicopters in Oxnard, said she supported Sable's efforts because it would give her company a boost. 'If they're not allowed to start their efforts again, this will have huge collateral damage to all of our local businesses, and also to our company in particular, and all of our local people who live here,' Lynn said. 'All of our employees are required to live in California. They are all local, and they are all affected.'
The Coastal Commission's permits are not the only step the company has to take to operate the pipeline. Multiple state agencies regulate pipelines, including the California Department of Fish and Wildlife's Office of Oil Spill and Prevention Response and the Office of the State Fire Marshal.
Environmental groups have called for a full environmental review of the pipeline under the California Environmental Quality Act.
National environmental organizations such as the Center for Biological Diversity have weighed in, along with local advocates, to support the Coastal Commission. A group born out of the original Santa Barbara oil spill — the Environmental Defense Center — opposes the project and efforts to restart drilling. The Surfrider Foundation also launched a 'Don't Enable Sable' campaign, and several beachgoers spoke out against the project.
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This story was originally published by CalMatters and distributed through a partnership with The Associated Press.