HOUSTON - Sable Offshore Corp. (NYSE:SOC) announced Monday it is launching a proposed senior secured term loan facility of up to $1.0 billion to replace its existing senior secured term loan with Exxon Mobil Corporation, according to a press release statement.
JPMorgan Chase Bank, N.A. is expected to serve as administrative agent under the new facility. The company also plans to pursue additional unsecured capital markets solutions.
Sable Offshore intends to use proceeds from the new term loan, combined with proceeds from the expected additional unsecured capital markets solutions, to repay the existing senior secured term loan with Exxon Mobil, pay transaction fees and expenses, and satisfy contractual performance bonding obligations. The refinancing comes as the company carries total debt of approximately $980 million against a market capitalization of $1.64 billion. An InvestingPro tip notes the company may have trouble making interest payments on debt, one of 15 key insights available to subscribers.
The company stated there are no assurances it will be successful in its marketing efforts or that it will be able to enter into the new senior secured term loan. Closing of the facility is subject to market conditions, negotiation and execution of definitive documents, and satisfaction of customary closing conditions.
Sable Offshore is an independent oil and gas company based in Houston, Texas, focused on developing the Santa Ynez Unit in federal waters offshore California.
In other recent news, Sable Offshore Corp. has provided an operational update, revealing that 40 wells at Platform Harmony and Platform Heritage are currently producing an average of 750 gross barrels of oil per day per well. The company also announced the resumption of oil transportation through segments of the Santa Ynez Pipeline System, with expectations to bring all 74 production wells online, targeting an average production of approximately 700 gross barrels of oil per day per well. Additionally, Sable Offshore is planning to refinance its debt, as stated in a press release. Benchmark has reiterated a Hold rating on Sable Offshore following the company’s financial guidance update through 2028. Meanwhile, Jefferies has adjusted its price target for Sable Offshore shares from $30 to $24, while maintaining a Buy rating. The adjustment comes after an operational and financial update from the company, discussed during a fireside chat with Sable Offshore’s CEO and CFO. In related developments, three Trump administration Cabinet secretaries are set to visit Sable’s oil project off the California coast to discuss legal strategies concerning the company’s ongoing dispute over its pipeline system.
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