Do California & Oil Mix After All?

👋🏻 This week you’re receiving a write up I’d typically only send to my personal network. Largely because this sort of play is very risky.

However, based on some conversation with readers I thought some of you would find some value in it. I hope you do!

^{Disclaimer: This report is for informational purposes only and should not be considered as financial advice or a recommendation to buy, sell, or hold any securities. The analysis and opinions expressed in this report are solely those of the author and are based on publicly available information. All investments carry risk, and readers should conduct their own research or consult with a qualified financial advisor before making any investment decisions. The author of this report assumes no responsibility for any losses or damages resulting from the use of this information. The information provided is accurate to the best of the author's knowledge at the time of publication but is subject to change without notice. Past performance is not indicative of future results.}

^{Disclaimer 2: @CorneliaLake & @BR_Kelleran on X deserve credit for many of the findings you’ll see below. Without them, I would have overlooked the opportunity in Sable.}

Name / Ticker: Sable Offshore Corp (SOC)

Investment Type: Special Situation / Deep-Value

Today’s Price: $19.94

Price Target: $85+

What’s the Story? 

In November of 2022 it was confirmed that Sable Offshore Corp. ($SOC) (Sable), via SPAC, had purchased The San Ynez Unit from ExxonMobil. This asset includes three offshore oil & gas production platforms in federal waters off the coast of Santa Barbara, California, along with the Las Flores Canyon Processing Facility, an onshore pipeline and processing facility under California jurisdiction.

San Ynez is one of the premier offshore oil assets in the United States and the world. It was Exxon’s most productive asset until 2015. To put San Ynez into context relative to other elite single-asset producers: