Form 8-K - Current report

false 0001831481 0001831481 2024-11-14 2024-11-14

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): November 14, 2024

 

 

Sable Offshore Corp.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware		001-40111		85-3514078
(State or other jurisdiction of incorporation)		(Commission File Number)		(I.R.S. Employer Identification No.)

 

845 Texas Avenue, Suite 2920 Houston, Texas		77002
(Address of Principal Executive Offices)		(Zip Code)

[phone]

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐

Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐

Pre-commencements communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.0001 per share		SOC		The New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

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Item 2.02

Results of Operations and Financial Condition.

On November 14, 2024, Sable Offshore Corp. (the “Company”) issued a press release announcing results for the quarter ended September 30, 2024. A copy of the press release is attached hereto as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

The information furnished pursuant to this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference in any filing made by the Company under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act.

 

Item 7.01

Regulation FD Disclosure

On November 14, 2024, the Company issued a press release providing an update on its ongoing coordination with the California Coastal Commission. A copy of the press release is attached hereto as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference. The information furnished pursuant to this Item 7.01, including Exhibit 99.2, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference in any filing made by the Company under the Securities Act or the Exchange Act.

 

Item 9.01

Financial Statements and Exhibits

 

(d)

Exhibits

 

Exhibit No.		Description of Exhibits
99.1		Press Release of Sable Offshore Corp., dated November 14, 2024, announcing results for the quarter ended September 30, 2024.
99.2		Press Release of Sable Offshore Corp., dated November 14, 2024, providing an update on coordination with the California Coastal Commission.
104		Cover page Interactive data file (embedded within the inline XBRL document).

 

2

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

				Sable Offshore Corp.
Date: November 14, 2024				By:		/s/ Gregory D. Patrinely
				Name:		Gregory D. Patrinely
				Title:		Executive Vice President and Chief Financial Officer

 

3

Exhibit 99.1

Sable Offshore Corp. Reports Third Quarter 2024 Financial and Operational Results

Houston, November 14, 2024 – Sable Offshore Corp. (“Sable,” or the “Company”)(NYSE: SOC) today announced its third quarter 2024 financial and operational results.

Third Quarter 2024 Financial Highlights

 

•

Reported a net loss of $255.6 million for the quarter, primarily attributable to a non-cash change in fair value of warrant liabilities related to common share price and warrant price appreciation during the quarter, production restart related operating expenses, and interest expense.

 

•

Ended the quarter with 78,789,516 shares of Common Stock outstanding after successfully raising $150.0 million in gross equity capital through a private placement of 7,500,000 shares of Common Stock and raising $72.5 million in equity capital through the exercise of 6,315,977 public warrants during the quarter.

 

•

Ended the quarter with outstanding debt of $814.4 million, inclusive of paid-in-kind interest, additional principal incurred from loan amendment, and debt issuance costs.

 

•

Increased cash and cash equivalents balance to $288.2 million by the end of the third quarter, exclusive of restricted cash balance of $35.3 million.

Third Quarter 2024 Operational Highlights

 

•

Reached a conditional settlement with Santa Barbara County (the “County”), in which the County acknowledged that they do not have jurisdiction over the installation of 16 new safety valves in the County along the Las Flores Pipeline System (the “Pipeline”).

 

•

Progressed restart related work at the SYU offshore platforms and Las Flores Canyon facilities through overhauling gas compressors, completing the safety device testing campaign, finishing all vessel and piping circuit integrity inspections, while onboarding and training a workforce of over 100 direct staff members and approximately 400 contractors across all Sable operating locations.

 

•

Made significant progress in executing the anomaly repair program on the Pipeline, reaching approximately 100 anomalies repaired through the end of the quarter, installing safety valves, and implementing other enhancements required to meet and exceed the conditions of the federal court consent decree to restart the Pipeline.

Recent Events

 

•

Received confirmation from the Bureau of Safety and Environmental Enforcement that Sable’s recent completion of lease-holding activities serves to maintain all 16 leases within the Santa Ynez Unit (“SYU”) to October 9, 2025.

 

•

On October 30, 2024, the Santa Barbara County Planning Commission voted to approve Sable as the Owner, Operator, and Guarantor of the SYU, POPCO Gas Plant, and Las Flores Pipeline System.

 

•

Completed the redemption of all outstanding public warrants on November 4, 2024. In total, 15,957,820 public warrants were exercised for $183.5 million in gross proceeds.

 

•

As of November 13, 2024 there were 89,099,863 shares of the Company’s Common Stock outstanding and an unrestricted cash balance of approximately $362.9 million.

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About Sable

Sable Offshore Corp. is an independent oil and gas company, headquartered in Houston, Texas, focused on responsibly developing the Santa Ynez Unit in federal waters offshore California. The Sable team has extensive experience safely operating in California.

Forward-Looking Statements

The information in this press release include “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. When used in this press release, the words “could,” “should,” “will,” “ may,” “ believe,” “ anticipate,” “ intend,” “ estimate,” “expect,” “project,” “continue,” “plan,” forecast,” “predict,” “potential,” “future,” “outlook,” and “target,” the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements will contain such identifying words. These statements are based on the current beliefs and expectations of Sable’s management and are subject to significant risks and uncertainties. Actual results may differ materially from those described in the forward-looking statements. Factors that could cause Sable’s actual results to differ materially from those described in the forward-looking statements include: the ability to recommence production of the SYU assets and the cost and time required therefor; global economic conditions and inflation; increased operating costs; lack of availability of drilling and production equipment, supplies, services and qualified personnel; geographical concentration of operations; environmental and weather risks; regulatory changes and uncertainties; litigation, complaints and/or adverse publicity; privacy and data protection laws, privacy or data breaches, or loss of data; our ability to comply with laws and regulations applicable to our business; and other one-time events and other factors that can be found in Sable’s Annual Report on Form 10-K for the year ended December 31, 2023, and any subsequent Quarterly Report on Form 10-Q or Current Report on Form 8-K, which are filed with the Securities and Exchange Commission and are available on Sable’s website (www.sableoffshore.com) and on the Securities and Exchange Commission’s website (www.sec.gov). Except as required by applicable law, Sable undertakes no obligation to publicly release the result of any revisions to these forward-looking statements to reflect the impact of events or circumstances that may arise after the date of this press release.

Disclaimers

Non-Producing Assets

The SYU assets have not produced commercial quantities of hydrocarbons since such assets were shut in during June of 2015 when the only pipeline transporting hydrocarbons produced from such assets to market ceased operations. There can be no assurance that the necessary permits will be obtained that would allow the pipeline to recommence transportation and allow the assets to recommence production. If production is not recommenced by January 1, 2026, the terms of the asset acquisition with ExxonMobil Corporation would potentially result in the assets being reverted to ExxonMobil Corporation without any compensation to Sable therefor.

Contacts

Investor Contact:

Harrison Breaud

Director, Finance & Investor Relations

[e-mail]

713-579-8111

Exhibit 99.2

Sable Offshore Corp. Continues to Coordinate with California Coastal Commission on Maintenance and Repair Work in the Coastal Zone

Santa Barbara, Calif. November 14, 2024 – Today, Sable Offshore Corp. (“Sable”) provided an update on its ongoing coordination with the California Coastal Commission (“CCC” or “Commission”) related to Sable’s maintenance and repair work along the existing Pacific Pipeline Company Las Flores Pipelines CA-324 and CA-325. The following statement was issued by Steve Rusch, Vice President of Regulatory & Environmental Affairs at Sable:

“Maintenance and repair activities that are exempt from Coastal Act permitting requirements have been conducted on the Las Flores Pipeline system under the pipeline’s existing Coastal Development Permits for the last 35+ years, and Sable believes recent work on the pipelines is within the scope of those historic activities. Sable has been extremely concerned about environmental risk from open excavations along the pipeline route since the Coastal Commission asked Sable to stop all work in the Coastal Zone at the end of September. Sable and the CCC are now working to agree on the terms of an interim work plan to fill the open excavations, and Sable will be prepared to start work immediately to fill those open excavations in order to protect the environment against erosion in case of any rain events. Restoring the excavations to their original condition will be the best way to ensure that the environment will be protected, which is the highest priority for the CCC and Sable. Once the CCC approves Sable’s interim work plan, Sable expects the work will take approximately seven days and Sable is prepared to start the work immediately. This coordination will allow for CCC and Sable to progress their discussions regarding how to proceed with the remaining pipeline maintenance and repair work in the Coastal Zone, without threat of erosion or other environmental impact during the onset of any inclement weather. We appreciate CCC staff’s engagement and efforts to work with us in trying to arrive at a solution, and share the Commission’s passion for protecting the environment and coastal resources.”

The Las Flores Pipeline system is 124 miles long and spans multiple properties. The open excavations with exposed pipe are limited to nine parcels of land in the Coastal Zone where pipeline maintenance and repair work already was underway. Outside of the Coastal Zone, Sable has continued its maintenance and repair activities along the pipeline to bring it to “as new” condition.

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About Sable

Sable Offshore Corp. is an independent oil and gas company, headquartered in Houston, Texas, focused on responsibly developing the Santa Ynez Unit in federal waters offshore California. The Sable team has extensive experience safely operating in California.

Forward-Looking Statements

The information in this press release include “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. When used in this press release, the words “could,” “should,” “will,” “ may,” “ believe,” “ anticipate,” “ intend,” “ estimate,” “expect,” “project,” “continue,” “plan,” forecast,” “predict,” “potential,” “future,” “outlook,” and “target,” the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements will contain such identifying words. These statements are based on the current beliefs and expectations of Sable’s management and are subject to significant risks and uncertainties. Actual results may differ materially from those described in the forward-looking statements. Factors that could cause Sable’s actual results to differ materially from those described in the forward-looking statements include: the ability to recommence production of the SYU assets and the cost and time required therefor; global economic conditions and inflation; increased operating costs; lack of availability of drilling and production equipment, supplies, services and qualified personnel; geographical concentration of operations; environmental and weather risks; regulatory changes and uncertainties; litigation, complaints and/or adverse publicity; privacy and data protection laws, privacy or data breaches, or loss of data; our ability to comply with laws and regulations applicable to our business; and other one-time events and other factors that can be found in Sable’s Annual Report on Form 10-K for the year ended December 31, 2023, and any subsequent Quarterly Report on Form 10-Q or Current Report on Form 8-K, which are filed with the Securities and Exchange Commission and are available on Sable’s website (www.sableoffshore.com) and on the Securities and Exchange Commission’s website (www.sec.gov). Except as required by applicable law, Sable undertakes no obligation to publicly release the result of any revisions to these forward-looking statements to reflect the impact of events or circumstances that may arise after the date of this press release.

Disclaimers

Non-Producing Assets

The SYU assets have not produced commercial quantities of hydrocarbons since such assets were shut in during June of 2015 when the only pipeline transporting hydrocarbons produced from such assets to market ceased operations. There can be no assurance that the necessary permits will be obtained that would allow the pipeline to recommence transportation and allow the assets to recommence production. If production is not recommenced by January 1, 2026, the terms of the asset acquisition with ExxonMobil Corporation would potentially result in the assets being reverted to ExxonMobil Corporation without any compensation to Sable therefor.

Contacts

Investor Contact:

Harrison Breaud

Director, Finance & Investor Relations

[e-mail]

713-579-8111

Document and Entity Information	Nov. 14, 2024
Cover [Abstract]
Amendment Flag	false
Entity Central Index Key	0001831481
Document Type	8-K
Document Period End Date	Nov. 14, 2024
Entity Registrant Name	Sable Offshore Corp.
Entity Incorporation State Country Code	DE
Entity File Number	001-40111
Entity Tax Identification Number	85-3514078
Entity Address, Address Line One	845 Texas Avenue
Entity Address, Address Line Two	Suite 2920
Entity Address, City or Town	Houston
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77002
City Area Code	(713)
Local Phone Number	579-6161
Written Communications	false
Soliciting Material	false
Pre Commencement Tender Offer	false
Pre Commencement Issuer Tender Offer	false
Security 12b Title	Common Stock, par value $0.0001 per share
Trading Symbol	SOC
Security Exchange Name	NYSE
Entity Emerging Growth Company	true
Entity Ex Transition Period	false

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