During development of the Third Dawn expansion, the developers mentioned players would be able to ride Sea Horses as a new water mount in Ilshenar. At some point in development it was determined that adding the ability for players to ride a creature on water created too many technical hurdles and potential exploits. Thus the Sea Horse was cut from the expansion.
Players have repeatedly asked over the years whether Sea Horses could be reconsidered for addition. However, developers have made it very clear that it would be too difficult and would rather work on other game features.