The move has only just this week been formally announced by JWS, and a spokesperson from Freehills confirmed that Mick Dulaney and Peter Smith are opening a new office, and will have “some kind of association with JWS”.

Expected to take place “some time in February”, Freehills touted the move as a new opportunity for the partners involved. “It’s just one of those ‘new phase in life’ type things, and the opportunity to focus specifically and exactly on the type of work they love to do,” the spokesperson said.

That work appears to be oil and gas resources work. For Dulaney, recent Freehills work has included advising the North West Shelf Venture on the sale of 5 per cent equity in its offshore petroleum titles as part of the sale of $25 billion in LNG to China. Another significant deal involved advising Gulf Indonesia Resources Ltd, now ConocoPhillips, on the proposed sale of gas from the South Suban gasfield in Indonesia.

JWS confirmed this week that the opening of an office in Perth with the addition of Dulaney and Smith to the partnership deepens the firm’s corporate and energy expertise. “[It] provides us with a range of connections in the corporate and resources sector in Western Australia,” said managing partner Peter Slattery.

One anonymous source told Lawyers Weekly that the loss of Dulaney and Smith “greatly reduces” the oil and gas resources of Freehills’ Perth office. “Particularly in relation to upstream projects and commercial work, with [Dulaney] highly involved in high-end work on a number of prestigious LNG projects and [Smith] on the infrastructure aspects of these,” the source said.

According to the source, the remaining partners of the Freehills energy and resources team focus on minerals and the corporate and finance side of the resources sector, as well as specific gas trading arrangements. “So this move leaves a large gap almost halving the size of the department, particularly removing its resources in Perth in relation to large oil and gas project work.”

Before Dulaney and Smith open the office in Perth, sources say they will work under the auspices and with the resources of their new firm’s Adelaide office. “Particularly since a good proportion of the projects in which they are involved are with South Australian clients,” said one source, who also speculated that many of the former Freehills partners’ Western Australian and international clients will follow them.

Richard Loveridge, the new corporate practice group head at Freehills, rejected the suggestion that the partners’ departure would leave a gap in the firm’s ability to service clients in these areas.

“The firm’s practice in this field has generally been regarded as the leading one in Australia for many years. [Dulaney and Smith] leave our team in the extremely capable hands of very highly regarded and experienced corporate and energy and resources partners and lawyers,” Loveridge said.

“In Perth, Stuart Barrymore and Rob Merrick have had the lead advisory roles in many of the major upstream oil and gas transactions that Freehills have been involved in the past decade, including the Ichthys, Bayu-Undan, Darwin LNG Project, Yolla and Otway.”

He said the firm would continue to advise on a number of other LNG projects as well, claiming that the Perth-based energy and resources team remains the “largest in town”, with more than 30 people actively practicing. Loveridge added as well that no one from within the team will be following Dulaney and Smith in their new roles.

Loveridge argued the firm was well placed to continue to deliver quality outcomes for clients, and said the team is well-positioned for ongoing growth. A Freehills spokesperson also noted: “Of course we’re sorry to see them go and of course we wish them all the best.”

But Lawyers Weekly’s anonymous source said the two departing lawyers will in effect be setting up a boutique practice, but one linked to a larger national outfit. Suggesting their personal incomes should rise rapidly by not having to share their incomes with the rest of the commercial group, as well as avoiding the large office overheads, the source suggested that boutique practices will increasingly become more popular in Perth for this reason.

As Lawyers Weekly went to press early this week, Peter Smith and Michael Dulaney were not able to be reached. See www.lawyersweekly.com.au for any updates on this story.