Sable is probably one of the most "special" special situations I've ever seen. It's quite clear that the fundamentals are NOT what's driving the stock, but the legal battle over the project. Plus, after hearing the Hunterbrook call, corporate governance can be better...
Agreed. This is not a fundamentals trade. It is a legal one. The market is pricing the court outcome, not the assets. That is why the setup is binary and extreme. A small shift in the legal path can reprice everything very fast.
Thanks a lot, Thomas, really appreciate it. Offshore deserves close attention right now. To meet future demand, the world needs roughly $18 trillion invested into oil and gas between now and 2050, and offshore will have to carry a big part of that load.
If they go the OS&T route, how do you think they get an air permit under the Clean Air Act from the SBCAPCD? Or is there some way they could avoid the requirement? Other commentators have said that this is the biggest hurdle (possibly insurmountable) to the OS&T route.
Thanks a lot for the question,but it is a tough one ☺️and to be honest I do not think even Sable has a full answer yet, so please do not be too hard on me if I am wrong.
My understanding is this
If they go OS&T with a vessel sitting close to the Santa Barbara coast, it will be treated as an OCS source under the Clean Air Act as long as it is within 25 nautical miles of shore. In that case it needs an air permit from SBCAPCD, basically like an onshore facility. There is no simple way to avoid that requirement unless they pushed the vessel beyond the 25 mile zone, which is not what they are currently proposing.
Id honestly wait until there's further indication trump may step in. California is a very green state and the dilution needed to keep this going until a resolution is reached will not be pretty. It's also a pretty safe bet if sable secured this they would not re rate all value from the catalyst in one day. It would likely be a lengthy re rate as it comes closer to production
I agree. I am also very curious what Li Lu will do. I generally do not like excessive risk. I prefer situations with as little risk as possible. It will be interesting to see how this plays out.
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Never happen. It’s California, ie, BANANAS: Build Absolutely Nothing Anywhere Near Anybody.
They couldn’t even permit an offshore LNG regas terminal, and that was under Schwarzeneggar.
Remember, Li Lu can afford to lose money: most of us cannot.
I agree. This is high risk, but also high reward. The probability of failure is real, but so is the upside if it works.
Patiently waiting to see Li Lu’s updated portfolio
Sable is probably one of the most "special" special situations I've ever seen. It's quite clear that the fundamentals are NOT what's driving the stock, but the legal battle over the project. Plus, after hearing the Hunterbrook call, corporate governance can be better...
Agreed. This is not a fundamentals trade. It is a legal one. The market is pricing the court outcome, not the assets. That is why the setup is binary and extreme. A small shift in the legal path can reprice everything very fast.
100% agreed.
Shared!
Thank you for writing up the post. I've been enjoying the reads on the offshore oil industry lately.
Thanks a lot, Thomas, really appreciate it. Offshore deserves close attention right now. To meet future demand, the world needs roughly $18 trillion invested into oil and gas between now and 2050, and offshore will have to carry a big part of that load.
If they go the OS&T route, how do you think they get an air permit under the Clean Air Act from the SBCAPCD? Or is there some way they could avoid the requirement? Other commentators have said that this is the biggest hurdle (possibly insurmountable) to the OS&T route.
Thanks a lot for the question,but it is a tough one ☺️and to be honest I do not think even Sable has a full answer yet, so please do not be too hard on me if I am wrong.
My understanding is this
If they go OS&T with a vessel sitting close to the Santa Barbara coast, it will be treated as an OCS source under the Clean Air Act as long as it is within 25 nautical miles of shore. In that case it needs an air permit from SBCAPCD, basically like an onshore facility. There is no simple way to avoid that requirement unless they pushed the vessel beyond the 25 mile zone, which is not what they are currently proposing.
Id honestly wait until there's further indication trump may step in. California is a very green state and the dilution needed to keep this going until a resolution is reached will not be pretty. It's also a pretty safe bet if sable secured this they would not re rate all value from the catalyst in one day. It would likely be a lengthy re rate as it comes closer to production
I agree. I am also very curious what Li Lu will do. I generally do not like excessive risk. I prefer situations with as little risk as possible. It will be interesting to see how this plays out.
Restacked