Fraser Milner Casgrain's Calgary Office: At The Center Of Alberta's Economy

Friday, October 1, 2004 - 01:00

The Editor interviews Douglas J. Black, Q.C., Senior
Partner, Fraser Milner Casgrain LLP's Calgary

Editor: Mr. Black, would you tell us something about your background and

Black: I was born and raised in Calgary but left to attend Dalhousie
Law School in Halifax, from which I graduated in 1975. Since that time I have
practiced in the corporate and energy sectors of the Canadian economy. Three
years ago I was invited by Fraser Milner Casgrain to become vice chairman of the
firm and co-head of the energy practice.

Editor: Fraser Milner Casgrain is now a national firm. How does the
Calgary office fit into the overall firm structure?

Black: With 600 lawyers, Fraser Milner Casgrain is a very large firm
by Canadian standards. It is governed by a national board on which the Calgary
office is well represented. Calgary is the country's second most important
commercial center - Toronto is the first - and our office, accordingly, is a
large and extremely busy one. Our contribution to the overall operation is very
significant, and as a consequence we are a very important part of the overall
firm structure.

Editor: Can you give us an overview of your practice?

Black: I have a very active practice, but as I become more senior I
find that I am engaged in providing strategic advice to my clients to a much
greater extent than in the past. There are, in addition, business and political
components to that advice as well as legal.

Editor: Please tell us about the Calgary office. I gather there is a
considerable history to its energy and natural resources practice.

Black: Absolutely. I talked to one of our retired senior partners this
morning, and he indicated that the firm has been involved with the energy sector
in Alberta since the 1920s. The first major oil discoveries here occurred in the
1940s, at which point a great many American companies began to pay attention to
the province and its resources. Two of the early participants were Sun Oil and
Gulf, and we were involved with both of them..

Editor: And other practice areas? How does the Calgary office reflect the
economy of Alberta?

Black: The economy of Alberta is one of the most diversified, and
strongest, in North America. The province has no debt, and at the present time
we enjoy a surplus of approximately $20 billion Canadian. With the
current high price of oil, we anticipate revenues approaching $30 billion
Canadian this year. I believe I am correct in saying that Alberta is the only
jurisdiction in North America with no debt. We have no sales tax, and our
corporate and personal income taxes are the lowest in Canada. Needless to say,
the province is a magnet for business, and over the past 10 to 15 years we have
seen Calgary evolve into the second most important business center in Canada and
very probably the third most important energy center in the world after London
and Houston. All of that is reflected in our office's practice. Not only does it
reflect the dominant reality of the energy industry here, it reflects Alberta's
strong financial services industry, its intellectual property and IT sectors,
and a whole host of other industries which are economic indicators. Real estate,
agriculture, construction, tourism, healthcare and research in a variety of
industries contribute to the prosperity of Calgary and Alberta, and Fraser
Milner Casgrain is providing services in all of these areas. The firm has
tracked the growth of the economy, both the city's and the province's, in just
about every practice area. With its office in Edmonton, it is the largest law
firm in Alberta.

Editor: To what extent did having the Winter Olympics in 1988 give the
city a boost?

Black: It had an enormous effect. If you have not lived in a city that
has hosted the Olympics, it is easy to miss the impact, but in point of fact the
Olympics serves to define a city and its aspirations for a period of time, and
the energy that it releases can drive a city for many years into the future.
That happened with Calgary. It put the city on the world map. It generated a
great deal of revenue, of course, but its most important contribution was to
give the community a great boost of self-confidence, a belief that they could
take on this very complicated, expensive and important undertaking and do it
well. The entire community was involved, and the results were enormously
successful. That has made the Calgary Winter Olympics a kind of benchmark for
subsequent Olympics, and today the city hosts an entire industry of Olympic
consultants. Cities seeking advice on security, food services, venues,
accommodations, media accreditation, all manner of sports facilities, and so on,
all find their way to Calgary sooner or later.

The Winter Olympics of 1988 was just about the best thing that ever happened
to Calgary.

Editor: I gather that the firm's energy and natural resources group
handles a great many complex transactions for the oil and gas and other resource
industries in Canada. For starters, how large is the group? What are the legal
disciplines that are represented in the group? Do you draw upon other practice
groups in the Calgary operation? Other offices?

Black: Our Calgary office has approximately 120 lawyers with about 25
people who are full-time members of the energy and natural resources group. The
entire group consists of some 60 to 70 lawyers, and they represent many
different disciplines: tax law, litigation, administrative and regulatory law,
corporate finance, real estate, environmental law and, indeed, just about
anything that the firm does is involved at some point or other. Unless a lawyer
is focused on, say, domestic relations on a full-time basis, it is impossible
not to be involved with the oil and gas industry at least some of the time.

We call upon lawyers from other practice groups frequently, and if we do not
have a particular expertise in Calgary we are able to draw upon the resources of
the firm's other offices. In Montreal we have a number of partners who practice
in the energy field, but with a particular focus on hydro resources. In Toronto
there is a group involved with the electricity industry. In Edmonton a resource
industry group concentrates on the regulatory aspects of the practice. All of
these people are available to the Calgary group on an ongoing basis. Our group
is also very active in British Columbia. Fraser Milner Casgrain has an office in
Vancouver, but this particular work is being done from the Calgary office. The
energy industry is new to British Columbia and, at least at the moment, it is
here that we have the people necessary to deal with it.

Editor: Can you tell us about some of the services the group provides?

Black: Among the services the group offers, asset acquisitions and
dispositions, regulatory work and corporate reorganizations are particularly
important. We have a great depth of experience here, and it is in both the
domestic and international aspects of these particular services. As a
consequence, we are sought after by clients seeking advice of the very highest
quality in these areas, and we are also able to attract the talent we need -
both young lawyers and people with experience in the field - to continue to
provide the highest level of service to our clients.

Editor: What types of organization does the group represent?

Black: We represent many of Canada's largest energy companies. This
includes Petro-Canada, Husky Energy, Enbridge Inc., EnCana Corp., Alliance
Pipeline Ltd. and a variety of other major enterprises in this sector. We also
act on behalf of governments with respect to energy issues from time to time. We
have represented the government of Alberta for many years on various matters..

Editor: When world oil prices are up, I imagine that the energy and
natural resources group is very busy. What about the opposite situation, when
oil prices are down?

Black: The industry is very cyclical. It is one of those sectors of
the economy that the only time lawyers are not busy is when business is static,
when nothing is happening. That, fortunately, is very infrequent. When oil
prices are up, and we are part of an extraordinarily active energy market, we
are, of course, very busy. When oil prices are down, however, we are also very
busy, with reorganizations, acquisitions and dispositions, consolidations and a
variety of employment issues. This is why Calgary is Canada's second most
important legal market, as well as the country's second most important business

Editor: What about the future? What do you see as the principal challenges
that this practice group is going to face over, say, the next five years?

Black: Well, the two challenges that we face are the ones that all
service enterprises face, wherever they are located. The first is attracting and
then retaining the caliber of lawyer necessary to continue to provide service at
the very highest level. The second is in providing those lawyers with the
resources to enable them to remain on top of an ever changing industry. The
energy and resource industry is global in scope, and the complexity of the legal
regime that governs it and the business issues that drive it are such that
continuing business and legal education could be a full-time undertaking. That
is not possible, of course, and we are challenged to find sufficient time to
stay abreast of things as the industry continues to evolve. If we succeed in
doing so, we will succeed in continuing to attract and retain the people we

Editor: From where do you recruit your talent?

Black: It is necessary to attract the best young students from the law
schools. Training them is both expensive and time-consuming, but it must be
done. An ability to bring in experienced attorneys laterally is also important,
and at all levels. There is turnover on an ongoing basis, and senior people move
on, retire, become general counsel for one of the firm's clients, and so on.
Replacing them is not easy. Having a full pipeline - and one that extends from
entry level to the highest reaches of the firm - is crucial to a firm's ability
to compete. At Fraser Milner Casgrain we understand that our most important
investment is in the people we hold out to our clients and to the markets in
which we carry on our activities. In light of our long and illustrious history,
I have no doubt that we will continue to do

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