PHMSA’s Abdication of its Duty on Sable’s Santa Ynez Pipeline

In 2015, Plains All American Pipeline’s line 901 (now CA-324, part of what is known as the Las Flores Pipeline System) ruptured and leaked 123,000 gallons of crude oil onto the Gaviota Coast. The community and the environment were devastated, and ultimately Plains was found criminally liable for its actions. 

The root causes of that failure, a defective external coating system and ineffective cathodic  protection, were well-documented. After years of litigation, a federal Consent Decree established what would need to happen before the affected pipeline segments, CA-324 and CA-325A/B (formerly Lines 901 and 903), could ever restart: recoating, replacement, or abandonment, with a special permit process available as an alternative. That process exists for a reason. It is the mechanism by which the Pipeline and Hazardous Materials Safety Administration (PHMSA), the federal pipeline safety regulator within the U.S. Department of Transportation, evaluates whether deviation from pipeline safety regulations can be done without compromising safety.

Background 

This pipeline’s corrosion problems are not a simple fix. The pipeline has an insulation-and-wrap coating system (specifically, coated with thermal polyurethane insulation and wrapped in polyethylene), which creates a problem well-known to the industry: the inability to control corrosion once the outer wrap is compromised. Cathodic protection works by running an electrical current through the pipe to counteract corrosion. It cannot, however, protect the pipe if it is shielded from reaching the pipe surface by shoddy insulation wrap. PHMSA found during its failure investigation that while Plains’ cathodic protection system met the regulatory monitoring requirements on paper, those readings did not reflect what was happening at the areas of corrosion. In essence, the pipe was corroding in places the system could not see or protect because of that wrap. This, over time, resulted in heavy external corrosion that was not detected by Plains’ in-line inspection tools. PHMSA’s own Failure Investigation Report concluded that corrosion under insulation cannot be prevented on insulated lines where the coating system has been compromised. The 2015 rupture was the result. The same coating system remains on CA-324 and CA-325A/B today. 

For the past few years, the pipeline’s new owner, Sable Offshore Corp., has been pursuing restart through state channels. When it could not get what it wanted from California, it painted the state as obstructionist for demanding compliance with the Consent Order that governs the restart and went running to the federal government for help. Within days of Sable’s submission of a letter reinterpreting the proper jurisdictional authority over this facility as federal, PHMSA had boots on the ground in California to affirm this finding and the regulatory machine was working to accommodate the operator’s demands. 

At the same time, Sable has been the subject of or the complainant in nearly a dozen lawsuits relating to restarting this pipeline. It has also received significant attention from the executive branch and the Department of Energy, all while its supporters have made false statements about the pipe and made claims that restarting this one pipeline will contribute to solving the nation’s energy crisis. 

PHMSA’s Flawed Process 

PHMSA allows operators to deviate from the pipeline safety regulations in limited circumstances, a congressionally established privilege called a “Special Permit.” These deviations, some of which PST has raised concerns about in the past, are typically limited in scope and protective “conditions” are established that attempt to mitigate the consequences of the noncompliance. The process also has basic requirements to be met: the operator must identify the regulation it seeks relief from, demonstrate why the deviation is not inconsistent with safety, describe alternatives it will undertake, and account for impacts on affected stakeholders. Renewals provide periodic checkpoints. The process is designed to be an exception. As PST pointed out in its comment, the deficiencies in the special permit application and the proposed special permit are significant.  

First, PHMSA proposed to grant the permit for the “operational life” of the pipelines. This does not appear anywhere in the regulations, Sable did not request it, and PHMSA offered it without explanation. The regulations require that permits be granted “for a period of time.” Renewals are the mechanism for extending that period and provide an opportunity to reassess whether conditions remain adequate. By converting a time-limited exception into an indefinite one, PHMSA discarded that oversight mechanism with no stated rationale.

Second, PHMSA applies a different, unnoticed standard for revocation in its proposal. Under the existing regulation, PHMSA may revoke a special permit when “based on a material change in condition or circumstances, continued adherence to the terms of the special permit would be inconsistent with safety.” The Proposed SP limits that authority to conditions “arising after the issuance of this special permit that implicate directly the national security interests of the United States or that result directly from an emergency as declared by the President.” PHMSA did this without explaining its departure from the regulatory text, without noticing the change for public comment, and without any apparent statutory authority to do so. Under this standard, PHMSA could not revoke the permit even if the pipeline were leaking unless the President had declared an emergency. This is simply beyond what Congress intended. 

Third, Sable’s application does not identify the regulations from which it seeks relief. The Consent Decree, the Corrective Action Order, and PHMSA’s own Failure Investigation Report all document that the root problem is a defective coating system that shields cathodic protection, making effective external corrosion control impossible. Sable’s application addresses a different and narrower provision, does not seek relief from the corrosion control requirements, and proposes no measures to address the coating system. PHMSA accepted the application as complete anyway.

Fourth, Sable’s application does not comply with the requirement to describe both positive and negative impacts on affected stakeholders. Instead of engaging with that requirement, Sable’s response describes only benefits, framing the special permit exclusively in terms of energy supply and citing Executive Order 14156, the administration’s energy emergency order, while omitting any discussion of risk or harm. The affected pipelines traverse approximately 125 miles through Santa Barbara, San Luis Obispo, and Kern Counties. The root causes of the 2015 failure (the defective coating and ineffective cathodic protection) remain present on both CA-324 and CA-325A/B. Affected stakeholders include the communities, commercial fisheries, recreational users, and ecological resources along that corridor that were directly harmed in 2015 and remain at risk. Before granting a special permit, PHMSA is required to determine that the application complies with the regulatory requirements. Accepting Sable’s incomplete response without requiring supplementation does not meet that standard.

Applicability of the Defense Production Act

In March 2026, the U.S. Secretary of Energy directed Sable to restart the pipeline by invoking the Defense Production Act (DPA). PHMSA then extended the public comment period and sought input on, among other things, “the impact that the DPA order might have on this proceeding, including whether the special permit remains necessary.”

PHMSA should not have framed whether it retains its statutory safety obligations as an open question for public input. The DPA is a national defense contracting tool. It does not amend, repeal, or supersede the Pipeline Safety Act. PHMSA and the Department of Energy operate under separate statutory authority. Whatever effect the Secretary of Energy’s order may have on other frameworks, it has no bearing on PHMSA’s congressionally assigned safety mandate. The special permit process remained necessary the day the order was issued and remains necessary today.

PST’s Perspective

PHMSA’s mission is to protect people and the environment by advancing the safe transportation of energy and other hazardous materials. That mission cannot bend to operator convenience, political pressure, or assertions of an energy emergency. The special permit process exists to allow limited, safety-justified flexibility, not to provide a mechanism for deregulation by accommodation. PHMSA should deny the special permit application as substantively and procedurally deficient. 

The public record on this pipeline is extensive. The 2015 failure, its causes, and the conditions that remain unresolved are documented in PHMSA’s own Failure Investigation Report. The communities and the unique sensitive coastal areas along this pipeline corridor deserve a safety determination that is procedurally sound and grounded in that record, not one shaped by the political circumstances surrounding a particular operator’s restart timeline. 

The photos above show the severe corrosion damage the pipeline experienced. Photos by the Pipeline and Hazardous Materials Safety Administration (PHMSA).