FOREST OIL CORPORATION PHANTOM STOCK UNIT AGREEMENT

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Exhibit 10.3

FOREST OIL CORPORATION
PHANTOM STOCK UNIT AGREEMENT

         THIS PHANTOM STOCK UNIT AGREEMENT (this "Agreement") is made as of the                         day of                        , 20            (the "Date of Grant"), between Forest Oil Corporation, a New York corporation (the "Company"), and [Employee Name] (the "Employee").

        1.     Award .    Pursuant to the FOREST OIL CORPORATION 2007 STOCK INCENTIVE PLAN, as amended (the "Plan"), the Company hereby makes a grant of phantom stock units with respect to                        shares of the Company's common stock, par value $.10 per share (the "Phantom Stock Units"). The Employee agrees that this award of Phantom Stock Units constitutes a Phantom Stock Award under the Plan and shall be subject to all of the terms and provisions of the Plan, including future amendments thereto, if any, which is available on the Company's intranet at the following site: http://corpweb1/. For paper copies of the Plan and prospectus, the Employee may contact Stock Administration, 707 Seventeenth Street, Suite 3600, Denver, CO 80202, or call 303.812.1502.

        2.     Definitions .    Capitalized terms used in this Agreement that are not defined below or in the body of this Agreement shall have the meanings given to them in the Plan. In addition to the terms defined in the body of this Agreement, the following capitalized words and terms shall have the meanings indicated below:

        (a)   "Corporate Change" shall mean the occurrence of any one or more of the following events:

          (i)  the Company shall not be the surviving entity in any merger, consolidation or other reorganization (or survives only as a subsidiary of an entity other than a previously wholly-owned subsidiary of the Company);

         (ii)  the Company sells, leases or exchanges all or substantially all of its assets to any other person or entity (other than a wholly-owned subsidiary of the Company);

        (iii)  the Company is to be dissolved and liquidated;

        (iv)  any person or entity, including a "group" as contemplated by Section 13(d)(3) of the Exchange Act, acquires or gains ownership or control (including, without limitation, power to vote) of more than 50% of the outstanding shares of the Company's voting stock (based upon voting power); or

         (v)  as a result of or in connection with a contested election of directors, the persons who were directors of the Company before such election shall cease to constitute a majority of the Board.

Notwithstanding the foregoing, the term "Corporate Change" shall not include any reorganization, merger or consolidation involving solely the Company and one or more previously wholly-owned subsidiaries of the Company.

        (b)   "Disability" shall mean that, as a result of the Employee's incapacity due to physical or mental illness, the Employee shall have been absent from the full-time performance of the Employee's duties for six consecutive months, and the Employee shall not have returned to full-time performance of the Employee's duties within 30 days after written notice of termination is given to the Employee by the Company (provided, however, that such notice may not be given prior to 30 days before the expiration of such six-month period).

        (c)   "Forfeiture Restrictions" shall have the meaning specified in Section 3(a) hereof.

        (d)   "Involuntary Termination" shall mean any termination of the Employee's employment with the Company which does not result from a resignation by the Employee; provided, however, that the term "Involuntary Termination" shall not include a termination as a result of death, Disability, or a termination of the Employee's employment by the Company by reason of the Employee's unsatisfactory

performance of the Employee's duties, to be determined by the Company in its sole discretion, or final conviction of a misdemeanor involving moral turpitude or a felony.

        3.     Phantom Stock Units .    The Employee hereby accepts the Phantom Stock Units and agrees with respect thereto as follows:

        (a)     Forfeiture Restrictions .    The Phantom Stock Units may not be sold, assigned, pledged, exchanged, hypothecated or otherwise transferred, encumbered or disposed of, and in the event of termination of the Employee's employment with the Company for any reason other than death, Disability, or Involuntary Termination, the Employee shall, for no consideration, forfeit to the Company all Phantom Stock Units to the extent then subject to the Forfeiture Restrictions. The prohibition against transfer and the obligation to forfeit and surrender Phantom Stock Units to the Company upon termination of employment as provided in the preceding sentence are herein referred to as the "Forfeiture Restrictions." The Forfeiture Restrictions shall be binding upon and enforceable against any transferee of Phantom Stock Units.

        (b)     Lapse of Forfeiture Restrictions .    Provided that the Employee has been continuously employed by the Company from the Date of Grant through the lapse date described in this sentence, the Forfeiture Restrictions shall lapse with respect to 100% of the Phantom Stock Units on the earlier of (i) the third anniversary of the Date of Grant, (ii) the date upon which a Corporate Change occurs, or (iii) the date upon which the Employee's employment with the Company is terminated by reason of death, Disability, or Involuntary Termination. Any Phantom Stock Units with respect to which the Forfeiture Restrictions