Vancouver Law Firm a Big Player in BC Hydro's Clean Energy Call
Stikeman Elliott partner sits on Hydro board; another a major player in Finavera Renewables.
Jonathan Drance, Hydro director
When Jonathan Drance registered as a delegate to last fall's seventh annual conference of the Independent Power Producers of British Columbia, conference organizers must have been tickled pink.
A Vancouver lawyer with the firm of Stikeman Elliott, Drance is one of Canada's leading experts on corporate finance and securities. And in recent years, he and other partners at the firm have worked on some of B.C.'s biggest mergers and acquisitions, reorganizations and public financings.
More importantly for the IPP proponents who gathered at Vancouver's Hyatt Hotel last November 1-3, Drance also is a government-appointee to the board of directors of BC Hydro and Power Authority, the province's largest Crown corporation.
And it's BC Hydro that decides to which IPP projects it will award long-term electricity purchase agreements. BC Hydro, simply stated, has the power to make certain independent power producers -- companies and individuals -- very wealthy.
Law firm has energy arm
Drance did not register for the IPPBC conference as a BC Hydro representative. Rather, he registered on behalf of Stikeman Elliott.
His firm -- which has 500 lawyers across Canada, of whom 40 or so work out of its Vancouver office -- features an Energy Group that provides specialized services for clients with interests in oil and gas, electricity and power generation, and renewable energy.
The Stikeman Elliott website avers that the firm's Energy Group lawyers are "among Canada's leading advisors to the renewable energy industry." Those lawyers, moreover, have "worked on development projects in the renewable (solar, wind, hydro, biomass and waste) and conventional energy sectors, including co-generation projects.
"In Ontario, Stikeman Elliott partners have worked on both sides of the procurement fence, acting as counsel to both the Ontario Power Authority (OPA) on the Renewable Energy Supply RFP... and to a variety of potential proponents, developers and independent power producers..."
Scott Perrin, a 1985 graduate of the University of Victoria's law school, heads the firm's Vancouver Energy Group. He attended the November 2009 IPPBC conference along with Drance.
Raising half a billion dollars for run-of-river
Also among those attending the seventh annual IPPBC conference were six representatives of Cloudworks Energy Inc., a Vancouver company that in 2004 opened a run-of-river, hydro-electric generating plant on Rutherford Creek, outside Pemberton. (It was sold in 2005 to the Innergex Power Income Fund.)
Cloudworks currently has ambitious plans for eight new run-of-river projects in the Harrison Lake-Lillooet Lake region. The company also intends to build a substation at the north end of Harrison Lake, which will be connected to BC Hydro's grid.
In need of financing, Cloudworks turned to Stikeman Elliott. The law firm's website boasts that in 2007, it helped to arrange a $518 million monoline-insured bond deal -- "the first... of its kind in Canada" -- for Cloudworks' Harrison Lake hydro project.
Ties to Finavera Renewables
Drance and Perrin are not the only partners at Stikeman Elliott's Vancouver office with more than a passing interest in the province's nascent IPP industry and BC Hydro's clean energy call.
Hein Poulus graduated from the University of British Columbia's law school in 1972, and obtained a master of laws degree from the London School of Economics the following year. After practising law in Vancouver until 1979, he transferred to Denver to work at a number of Edgar Kaiser Jr.-owned companies, including Kaiser Resources and the Denver Broncos football team.
Poulus returned to Vancouver in the early 1990s and joined Stikeman Elliott. In 2001 received a provincial appointment as a Queen's Counsel.
He owns common stock in numerous publicly-owned companies, and is currently listed as an "insider" at a half-dozen such entities, most of which focus on mining. Among the companies in which Poulus has an equity position are Waratah Coal Inc., Pacific Coast Nickel Corp., Mega Moly Inc., Buffalo Gold Ltd., and Teslin River Resources Corp.
Poulus also has an avid interest in BC Hydro's clean energy call and the province's IPP industry through directorships and equity positions in Resinco Capital Partners Inc. and Finavera Renewables Inc.
Those two companies can be traced back to 2004, when Brownstar Ventures Inc. was incorporated as a "capital pool" company and began trading on the TSX Venture Exchange.
(A capital pool company obtains a stock-exchange listing so as to raise capital through the sale of shares to the investing public. At the time of the listing, the company does not have to have an actual commercial business in operation, but it must acquire one -- in a "Qualifying Transaction" -- within 18 months or suffer de-listing from the exchange. The capital-pool concept originated in Alberta and is unique to Canada.)
Brownstar's first annual general meeting was held on June 28, 2005 at Stikeman Elliott's Vancouver office. Shareholders approved a qualifying transaction whereby the company purchased certain assets from a group of businessmen, one of whom was Hein Poulus, and voted to change Brownstar's name to Longview Strategies Inc.
The newly-acquired assets involved equity positions in several companies, including 1,120,000 common shares of an Irish endeavour, Finavera Renewables Ltd.
Poulus subsequently won election to the renamed company's board of directors and was appointed corporate secretary. (Longview Strategies Inc. later became Longview Capital Partners Inc.)
Near the end of the following year, 2006, Finavera Energy Canada Inc. (a subsidiary of Finavera Renewables Ltd. of Ireland), was amalgamated with another capital pool company, Cascade Minerals Inc., and began trading on the TSX Venture Exchange as Finavera Renewables Inc.
In December 2007, Poulus won election as a director of Finavera Renewables Inc., and in October 2008 became chair of the company.
Four months ago, in November 2009, Longview Capital Partners Inc. changed its name to Resinco Capital Partners Inc.
Poulus currently serves as chair of both Finavera Renewables Inc. (in which he owned 9.8 million common shares as of the latest filing, in July 2009) and Resinco Capital Partners Inc. (14.2 million common shares as of March 2010).
(Peter Leighton, an ex-Accenture executive, is president and chief operating officer of Finavera Renewables Inc. John Icke, another former Accenture executive, is Resinco's president and chief executive officer.)
Specialists in the mega-deal
Jonathan Drance and Hein Poulus have worked together on some of British Columbia's biggest -- indeed, most historic -- corporate deals. In 2004, for example, they were part of a nine-lawyer Stikeman Elliott team representing Slocan Forest Products when that company was acquired by Canfor Corp. for $900 million.
And at the beginning of the decade, the pair toiled on one of the province's largest-ever corporate acquisitions as Duke Energy of Charlotte, North Carolina bought Vancouver's Westcoast Energy.
That November 2001 deal, valued at a whopping $13.3 billion, required the services of a dozen Stikeman Elliott lawyers -- including Drance and Poulus -- working on Duke's behalf.
Drance is a BC Hydro director
Jonathan Drance graduated from Harvard University (magna cum laude) in 1975, and obtained his law degree (with a gold medal) from the University of Toronto in 1978.
He was named to BC Hydro's board of directors by Gordon Campbell's BC Liberal government on May 8, 2008, and serves as chair of the utility's Corporate Governance Committee. He also sits on committees overseeing Capital Projects and Human Resources.
In fiscal 2008/09, BC Hydro paid Drance $40,000 for his services (see p. 62 here).
A new era of green gold
On March 11, 2010, BC Hydro announced that 19 projects proposed by ten different companies had been picked for Energy Purchase Agreements.
Six of the successful companies won approval for a single clean-energy project, but the other four had multiple projects selected.
And among the latter were two companies -- Cloudworks Energy Inc. and Finavera Renewables Inc. -- with a long-standing association with Stikeman Elliott.
Cloudworks, backed with that $518 million bond financing arranged by Stikeman Elliott in 2007, won approval for three run-of-river developments -- two near Mission (Tretheway Creek and Northwest Stave River) and another close to Harrison Hot Springs (Big Silver-Shovel Creek).
Finavera, chaired by Hein Poulus, was selected to develop four wind-farms in B.C.'s Peace River country -- three outside Tumbler Ridge, and the other near Dawson Creek. ![]()




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Grumpy
1 year ago
Corruption............................
.............deciet, and back door deals is the hallmark of Gordon Campbell's Liberals.
British Columbia has become a massive ponzi scheme, where the taxpayer is treated as a rube by all in power. The entire BC Hydro/Green power scandal is one that would make Bernard Madoff smile.
And where is our hapless 'Leader of Her Majesties Loyal Opposition', god knows, fumbling and bumbling along not knowing what day it is nor where she is.
We live in a new dark age, made even more sinister by a Carole James, who does not understand her job or the NDP who do not understand their role.
And the 30 pieces of silver award goes to the mainstream media and Bill Boring, who like the German press in the '39-'45 war, turned a blind eye to a murderous and despotic government and only reported what the central propaganda ministry (not unlike the Premier's PAB) told them to report.
Only this time the mainstream media, there is no jackboots in the night, death squads, or nacht und nebel, you support this corrupt Gordon Campbell out of your own perverted will.
Never has a population been so ill served, by such a bought off media.
cfvua
1 year ago
Nice work
Great piece of investigative work by Mr. McMartin again. Not really surprising news. The smell around Victoria just gets more unbearable every day. Don't we have a conflict commissioner to monitor this type of thing? Is this just standard business under Campbell? Peace region residents are anxious to see if Finavera financed by GE will also hire an American contactor who will sub work to an Ontario company who then subs to an Alberta company like Plutonic is reported to have done on the Dokie project. Must be lots of extra money around to cover markups. No jobs for BC residents other than in the cozy offices in Vancouver/Victoria of the well connected. Don't ask, not interested, already covered. Thanks for voting liberal.
Adam M
1 year ago
Great Article
Just wanted to thank Will McMartin for another excellent article. He names names, this guy! Please keep up the excellent detailed work; this is by far the number one story in this province, much bigger than the Olympics or the HST.
LarryBC
1 year ago
Conflict commissioner job under scrutiny along other watchdogs
cfvua wondered where the Conflict Commissioner is...
Gordon Campbell announced about a month ago the appointment of a task force of 6 people to review, within 4 weeks, the effectiveness and job descriptions of the 8 provincial government watchdogs.
So, the Conflict Commissioner, the Freedom of Information & Privacy Commissioner, the Police Complaints Commissioner, the Ombudsperson, the Auditor General, etc. are all awaiting news of their fate at this moment, and are not doing much of anything.
One example, is the Ombudsperson's report into the numerous complaints about the care of seniors in BC health care facilities -- it is way, way overdue. No reason given for such foot-dragging on her report, other than (one can guess) she expects hell to break loose when she comes out with a light slap on the wrist instead of what a true, independent officer of the people should be doing in support of vulnerable citizens. Just watch.
And, if the 4 week duration for a review of such a complex subject matter isn't a tip-off for "rubber stamp of foregone conclusion", I don't know what is.
The report on the 8 government watchdog agencies was to be delivered this week (early April) as I recall. Wonder where it is? Probably in Gordon Campbell's workshop, undergoing special tinkering, refitting it so it can become another Trojan horse for their deceptive actions that are debilitating the province of BC.
lynn
1 year ago
Another great one by Will McMartin
There is a certain irony to this article being published on Easter Monday....as there appears to be, especially when it comes to Accenture, a story brewing here of biblical proportions that involves resurrection from the dead, ascension (northwards)....and the providing of safe haven for loyal disciples.
LarryBC:
Well said....you raise a really important issue.
Yes..... the ever well-funded "Ministry of Special Tinkering" is no doubt very busy these days.
Fiat lux
1 year ago
Let us remember that the
Let us remember that the vast majority of history's atrocities have been scripturally licenced by priesthoods, as the "will of God".
The same as the present atrocities are licenced by the Priesthood of the Money God, our so called "economists".
The politicians are only acting on their behalf and without them they wouldn't have the scriptural justification for the presently ongoing biggest crime wave in human history.
Therefore, there's little point in complaining against the criminal actions of politicians, because their actions are only the effects of the crap being taught in our universities as "economics".
Nothing more than another religion licencing colonization, theft and mass murder.
Ed Deak.
unhappyvoter
1 year ago
Will McMartin and B.C.Hydro Board
Will McMartin points out the certainty of future huge
profits for the private sector insiders. Our current Provincial government seems intent on pushing through
these developments, regardless of rate increases to ordinary citizens. How can we stop this? We seem to be powerless (no pun intended).
Fiat lux
1 year ago
We're supposedly living in a
We're supposedly living in a democracy, but our governments are elected as unquestionable dictators for the term of their office.
If the public is permitting them to be dictators, these outrages and giveaways will just keep going on.
I'm not suggesting any violent revolutions, as they usually backfire and we don't need any more violence, but there should be some legal and peaceful ways to stop legalized crimes against humanity and the ecology.
Ed Deak.
GreenEnergy
1 year ago
Questionable article
Aside from the glaring errors in this article that shows there was little fact checking done - None of the links work! Another character hit job. Wonderful!
North of Hope
1 year ago
Links work
The 1st link doesn't work. but the others I checked do.
GreenEnergy
1 year ago
How pathetic
This journalist claims that Drance is somehow influencing BC Hydro and the staff to award EPAs to favored companies, because someone in his law firm happens to be related to an IPP.
The law firm is like 5000 employees! There is not a single company in BC that is not represented in this lawfirm! And such an accusation is libelous - because not only its false, but Will has absolutely NO evidence - just is making things up, based on his ideology.
And then the author criticizes Drance for attending the IPP conference. There are at least ten such conferences in BC every year. As a person interested and versed and working in renewable energy, he better educate himself by attending the conferences.
What I see here is a bitter group of losers who feel envy for those IPPs who are developing one of 291,000 creeks in BC, but these losers don't have the skills or work ethic to go produce renewable energy, so they diss others for being productive - and diss them for the most irrational of reasons (attending conferences, which is required, and having somebody in their company, who is related to an IPP.)
How pathetic.
Also Will - having multiple EPA, unlike what you insinuate is exremely common, and means nothing. If you have 3 projects, its better to have separate EPAs, and a single EPA often makes no sense. Multiple EPAs do not cost any more than a single EPA. But of course you have no idea what you are talking about.
Ignorance rules.
G West
1 year ago
The important people aren't the employees
They are the:
... 500 lawyers across Canada, of whom 40 or so work out of its Vancouver office
I think you're trying to change the subject GreenEnergy.
Maybe you'd care to disclose your own 'connection' to a certain IPP?
How about it, or does someone have to point out one more time 'exactly' why you pop up at Tyee every time this subject comes up.
As for the libel accusation! It's pretty clear your skills are in engineering and not law.
Calling people losers is so 'déclassé' doncha know. It indicates a certain 'desperation' or panic....
Adam M
1 year ago
Broken Link
Here's Drance's profile link on the Stikeman website:
http://www.van.stikeman.com/cps/rde/xchg/se-en/hs.xsl/Profile.htm?ProfileID=16258
The link was malformed during publishing, it seems. If it happens again with my post, just go to the main site (www.van.stikeman.com) and enter Drance's name in the people finder search on the left of the screen.
David Beers
1 year ago
response to 'GreenEnergy'
I can assure you that Will is a careful researcher, including fact checking. Please tell us any errors so we can correct them.
and please don't accuse Will or The Tyee of making any 'libelous' accusations that are not in the piece. Neither Will nor The Tyee are accusing Mr. Drance or anyone in his firm of anything. The purpose of this piece is to begin to sketch the players who are involved in BC's newly forming "clean tech" renewable power industry.
crankypants
1 year ago
Looking into my crystal ball
First of all, I once again thank Mr. McMartin for his due diligence in connecting the dots for the rest of us. If only the mainstream media were so inclined then the majority of British Columbians would be enlightened instead of the select few that seek the truth.
It is obvious that the IPP edict was designed to reward those that were and are loyal to the BC Liberal party. Sadly, this will come at the expense of the citizens of BC.
One question I do have is this. Why is the official opposition, the NDP, not bringing any of this information forward? I'm sure that they have many more resources, taxpayer funded no less, than Mr. McMartin, and virtually nothing. One could almost conclude that we are being played by both sides of the Legislature.
Maybe an increase in immuneration doesn't bring us the best and the brightest, but the complacent. Once again the taxpayer gets to play the role of the rube.
WHEN WILL IT STOP?
cfvua
1 year ago
Sensitivity
Wow. Somebody has touched green energy's sensitivity button. Quite a defensive position if everything is as innocent as it is said to be.
I wouldn't put too much faith into what comes out of a "conference". Some of these things are so phony and are set up by the organizers to deliberately create an issue where there isn't one and then assume that the discussions becomes official policy. Most are a complete waste of time and the government should stop sending our bureaucrats to them. They only benefit the organizers who are business owners who also are "plugged in" if you will. None of my companies are represented by the firm either.
Not sure how we get by without them, but then maybe if they did.......
Wind energy, unless things change drastically quickly will be a drain on the economy, with very few BC jobs created during construction. "Special" people being brought in to do the most menial of tasks.
Yeoman
1 year ago
"Green"
So is the "green" in GreenEnergy astro-turf, lead based paint or US dollars?
SCR
1 year ago
Queen of De Nile
Thanks to Will McMartin for reporting this compelling exposure and the Tyee for publishing this record of conscience.
The Commissioner for Conflict of Interest should start investigation without further ado. The COI legislation intends to prevent any instance from proceeding so far. The government of the day lacks political wit to see its own pathology. The Liberal leader has previously dismissed CoI rather than allow independent review.
To read the steps, here’s the link : http://www.leg.bc.ca/38th4th/1st_read/m216-1.htm
Hydro Minutes will reveal whether this director properly informed the Board, withdrew from promoting and voting, has placed his portfolio in blind trust and fulfilled the intent and spirit of the law governing his privileged appointment by the Liberal. Full access should be offered to this research.
The value of law is determined by its adoption within the intended community and enforcement without favoritism. This case betrays a blind spot among “elite” business and the Liberal camp. Self regulation is a code for free hand and any behavior. Do the rest of us want our society and democracy remembered for double standards and rapacity ?
shabbaranks
1 year ago
Sigh
Drance is a director at Hydro because of his expertise and skill at the types of operation that a billion dollar corporation needs. I'm not on the board because my experience is more in the thousands of dollars range - I can't do his job as well as he can. Neither can you most likely.
A board like Hydro's should be made up of a diverse group of experts who together can run it for the best interests of the group it serves. They've got a succesful architect, someone who's managed highways and infrastructure projects, an aboriginal chief, accountants, finance experts and engineers. Again, I am not on that board because the biggest project I've managed is changing a bike tire. How many billion dollar decisions have you been trusted with? BC Hydro's board needs lawyers. It especially needs lawyers familiar the electrical industry and, for better or for worse, one that is familiar with a key stakeholder in BC Hydro's future: IPPs.
Should there be citizen representatives on the board? I think so, but I don't see anyone else suggesting this. What I see is blind rhetoric about corruption and petty political snipes. There is no reason at all why Drance should not be on the Hydro board. This article, or at least the way everyone is responding to it, suggest that there is some gross manipulation of the system going on here. When Drance sits on that directors chair, he has a mandate that excludes benefiting himself or any of his other interests. How effective are these restrictions is up for debate, but I know that most of these folks take their responsibilities seriously. It is transparently located here http://www.bchydro.com/about/company_information/board_committees/board_of_directors.html under Terms of Reference. Read it, and if you think Drance is operating outside this framework, make a complaint to the utilities commission.
Drance is but one man on the board. One man does not run a board, they make decisions together. Shout corruption at Chief Kim Baird and Peter Busby while you're at it, because they're just as culpable for whatever crimes you all are accusing Drance over.
G West
1 year ago
shabbaranks - I think you've missed the point
With respect, I think the real question is NOT Drance's roll on the BC HYDRO board...The problem is his attendance at the IPP Conference. These people are studying and collaborating on ways to profit from relationships and contracts with a PUBLIC entity on whose behalf Drance has a duty to act. He is not on Hydro’s Board to advance the project of IPP power.
He is therefore, or at least he has the appearance of being, on both sides of the IPP issue - that's the problem, and the implication that Will McMartin spells out very clearly in the first 4 paragraphs of this column.
He then goes on to illustrate even further the 'appearance' of a conflict because of the way Drance registered for the conference - as a representative of his LAW FIRM - not as a Hydro board member.
From that, it seems quite clear that Drance is, at least nominally, playing both sides of the game.
He further points out why Stikeman Elliott, with its ties to Finavera Renewables (among other firms) is also in a potential conflict of interest relative to BC Hydro.
I don't believe it's too much to expect that the 'experts' BC HYDRO calls upon to staff its board should not also be - at least nominally - representing financial interests which will undoubtedly profit from doing business with HYDRO.
I think the case is pretty clear and Will McMartin's spelled it out very ably.
If Kim Baird is a big shareholder in any of the IPP firms who're clamoring to get sweetheart contracts with BC Hydro I'd expect Will McMartin to write about that too.
The fact he hasn't is probably because SHE isn't in a conflict situation.
cfvua
1 year ago
Connections
Are what it is all about with this group. Why else would you bring a general contractor from Minnesota(are we short of GCs in BC?) to put together the balance of a $300 Million project near Chetwynd? Who then brings a trucking company from Ontario (must be short of trucks in BC too) who brings another trucker from Calgary to actually do the work.(Is Ontario short of trucks too?) HOpefully the shareholders of Plutonic aren't being duped by people with connections into paying more for construction than they need to. Just the markup on this phony arrangement should raise some hackles.
But then if the right folks are getting it will anyone care, other than the people who get to stay on EI while they watch out of province taxpayers take paycheques home.