McBride says that the government appears to have heeded the message, although it will be difficult to see what actually transpires until external advice is next needed on a major project. “Not too many of these projects pop up every day,” he says. “The local firms and the Law Society have had a very strong view about the fact that there wasn’t much procedural fairness given to local firms. I’ve been assured that will change, but we’re waiting to see projects where [we might see that] change –they don’t pop up every day. If you miss them, you miss them.”
Local firms still play a role in the big projects, but more commonly via a referral from a national firm. Kelly & Co, for example, worked with Mallesons to assist a consortium which bid (unsuccessfully) for a role in the New Royal Adelaide PPP. Adelaide firms value the relationships they have with national firms and the source of work this provides. “We’ve seen a strong inflow of work from the East Coast and the top tier for a multitude of work,” says Stuart Price. “Some of our people have returned to South Australia from some of those larger firms and they’ve brought back those personal relationships – these are the “go to” people in Adelaide because they are already known for the quality of their work.”
Another example of such a relationship in action is Finlaysons, which has been brought on board the New Royal Adelaide PPP by Freehills to assist with a range of matters. “It’s producing work for us and we’re pleased about that - inevitably there is a reasonable amount of legal work which arises out of such a project and all indications are we will get a reasonable role in that,” says partner David Martin.
However, the Finlaysons-Freehills relationship is not exclusive. “We act for a range of different firms,” says Martin. “We’ve remained firmly non-aligned and it’s thus far worked to our advantage - we’ve been the beneficiary of work from quite a number of major national firms who don’t have a presence in Adelaide.”
That helps to explain why a number of Adelaide firms have opted not to open offices outside of their home state. “Inevitably there is a compromise,” says Martin, “You become an immediate competitor and there has to be some level of impact on that relationship, I’m sure.”
Martin says that his firm still performs work for national clients and has not excluded the possibility of opening interstate one day. “It’s not part of our strategic plan at the moment but it is always under review,” he says. “At the moment we consider there is a lot going on in our own backyard. We’re keeping a very strong eye on what’s going on locally, rather than taking our eye off the ball a bit to focus interstate.”
BHP has a long-standing relationship with Blake Dawson and the firm’s decision to open an Adelaide office is understood to be in anticipation of extra work from the Olympic Dam expansion project. “If the expansion goes ahead, there will be a huge demand for legal support – it will be interesting to see if any of the other BHP firms decide they need to be here,” observes Nigel McBride.
Minter Ellison has recently been engaged to advise on the operational aspects of the existing Olympic Dam site, a move which appears to have displaced Finlaysons, which previously performed that role. “Currently we are doing some BHP work but I must say there hasn’t been much work,” admits David Martin. “We’ve still got a number of things that we’re acting on but in terms of the ongoing role we’re not sure what the status is. This is one of those areas where not being a national firm has not worked in our favour – BHP have indicated they want to deal with national firms. However, we’ve also had indication that the doors are not closed on us - they will still be adopting a horses for courses type approach.”
Clearly there is more to the South Australia resources story than BHP and Finlaysons still has a strong client base which includes Santos, Ozminerals and a range of others who are very active. “We’re still very positive and looking forward to the work that’s coming out of the mining sector,” says Martin.
Another positive feature of the SA resource market, for those who are inclined to think in the longer term, is that many projects are at a relatively early stage. “A lot of stuff in South Australia is at the exploration stage,” says Joseph DeRuvo. “That’s good for us - have a look at QLD and WA for example, they are often past that stage and at the mining stage. We’ve still got a lot of companies at the exploration stage; the next stage is mining and processing - we’ve got many, many years of work ahead of us in that sector: not just mining, but also associated industries.” It means that local business people are making investment decisions with the expectation of several decades of resources activity. “I’ve got a client who had a very successful manufacturing business making alloy wheels. He has now changed his focus to providing hose connections for mining industries because he sees that as the way of the future,” says DeRuvo. “He’s re-engineered his entire business because he’s seen that he’s got another 20 to 40 years of work in that industry. There are a lot of people thinking like that.”
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