It’s an embarrassingly provincial sentiment to admit to in this era of national law firms, but Calgary lawyers still get off on doing something better than their more numerous peers and competitors in Toronto. They’ve got energy — especially oil and gas — wrapped up and in the regulatory framework that governs the sector, they have no Eastern peers.

At least, that’s what they’ll tell you in unguarded moments after returning from a triumphant eastbound sojourn. In more politically correct moments, they point to their national regulatory practices. Bennett Jones may have Laurie Smith and Loyola Keough et al. in Calgary, but they aver the firm’s “capability in Toronto is considerable.”

Fraser Milner Casgrain’s Alberta offices may boast an army of regulatory heavyweights such as Richard Neufeld and Allan McLarty, but Jerry Farrell — regarded as “one of the top regulatory lawyers in the country” by Calgary competitors — makes his home on Bay Street. The only firm that doesn’t claim to have a competent if not thriving Ontario regulatory practice is Burnet Duckworth & Palmer, and that’s only because BDP’s only office is in Cowtown.

But come on. The National Energy Board has been headquartered in Calgary since 1991. (The move led to much rejoicing within the Alberta regulatory bar. But no one held the frequently flying regulatory cadre responsible for the slump that hit the airline industry that year — they may have been flying to Ottawa less, but they were flying to the Maritimes more. And still are.)

In addition to being the hub of the country’s regulated energy industry, Alberta spearheaded the move toward deregulation in utilities (and other formerly regulated industries).

Deregulation has always, ironically, meant a spike in work for regulatory lawyers. Gas distribution deregulation lit the fire under the practice area some 15 years ago, notes Mr. Smith, who came into private practice about that time after a long stint with the N.E.B. Utility deregulation did the same. Both established a pattern much of the work in the area has followed: It starts with confusion about a variety of issues, followed by numerous hearings — often accompanied by litigation– which slowly dissipates as participants sort out the rules and the case law, allowing them to reach more or less long-term settlements. The regulators can then move to tinkering with (occasionally dismantling) another area of the regulatory framework.

“Things like export-licence hearings or pipeline rate hearings, which were so key to the practice 15 years ago, we just don’t do any more,” says Mr. Smith.

Good thing, too. Because there are myriad of new issues to sort out.

“There has been a real growth in the entire industry,” says Mr. Smith. “We have had more pipelines, lots of oilsand projects, continuing issues around utilities, new issues around gas storage.”

Most of the hubbub these days is around pipelines — and not just the mythical “will it ever be built” Mackenzie Valley one — and oilsands, and where the twain intersect.

“Over the next year, we will probably see a number of applications brought forward for oil pipelines,” says Don Davies, a regulatory partner with McCarthy Tetrault. TransCanada has already done so with Keystone, and competitor Enbridge has a couple of similar conversions in the pipe. And Mackenzie — well, let’s just say that the number of stakeholders and review processes involved hasn’t hurt billables at regulatory departments any.

Add to the mix liquid natural gas (LNG) terminals, emerging issues with coalbed methane (starting with who owns the stuff, never mind the environmental implications of getting it out), and a question mark over the industry and regulatory response to climate change, and the result is a regulatory lawyer talent war.

“We’ve never felt unloved,” says Douglas Crowther, a regulatory partner with FMC. “But certainly now, law firms are valuing regulatory practices even more, and I think for good reason. So we are feeling more loved. I suppose.”

Or at least more coveted. FMC got a reputation as the regulatory firm in town before many other firms officially inaugurated separate regulatory departments. Over the years, it has effectively seeded many of the regulatory practices in Calgary — many of the best regarded practitioners around, including C. Kemm Yates and David Holgate, now at Stikeman Elliott — are FMC alumni. Other significant moves of note in the area have seen Mr. Davies and Terry Hughes trade Macleod Dixon for McCarthy Tetrault and Shawn Denstedt and co. move from Bennett Jones to Osler Hoskin & Harcourt.

The trend won’t abate anytime soon.

“Between the actual and proposed pipelines and the all the oilsand projects, there are regulatory issues and hearings that will keep a lot of people busy for a long, long time,” says Mr. McLarty. What he means to say: The law firms that want to be part of the long-term, labour intensive and lucrative work emanating from the pipelines and oilsands need to have topnotch regulatory capability.

And the top of the pile is small and elite. Not to mention ageing.

“When you look at the regulatory bar, it does tend to be all relatively senior lawyers,” says Mr. Davies. “So probably, over the next number of years, we will see some of those folks passing the torch.”

That gasp in the background was the army of Mackenzie clients shuddering in horror. Fear not. “There is a number of young pups coming up who are very good lawyers and becoming rapidly recognized as being such,” says Mr. McLarty.

But they’re less likely to be as good at as many things as those who came before them. The first wave of regulatory lawyers — now long retired — appeared before the NEB and its provincial equivalents in-between litigating other civil (or even criminal) matters, as well as doing solicitor work. The next wave were regulatory practitioners period — but with considerable breadth in what defined their practice area. The up-and-comers tend to have less breadth, but more depth.

Specialization has arrived. But not with a vengeance, notes Mr. Crawther.

“I spent a number of years doing virtually nothing but electrical work because of the restructuring of the Alberta electric industry,” he says. Now, electricity is going the way gas did a decade ago — “pretty much sorted out”–and Mackenzie and its less controversial brethren (and all those oilsands projects) loom large.

Like everything in the oilpatch, even regulatory work is cyclical.

Fortunately, as Mr. Crawther puts it, “The skills are transferable.”

And so, as the recent spate of moves illustrates, are the lawyers.

(Copyright National Post 2007)