B&W Awarded Contract to Supply and Construct Environmental Control Equipment.

HOUSTON -- McDermott International, Inc. (NYSE:MDR) announced today that its subsidiary, The Babcock & Wilcox Company ("B&W"), has received a contract for engineering, materials, construction, start-up and commissioning of environmental equipment at Allegheny Energy's Fort Martin Power Station near Maidsville, West Virginia. This contract will be included in B&W's second-quarter 2007 bookings.

For its share of the plant's total $550 million project, B&W will perform work on Fort Martin's two 550-megawatt supercritical coal-fired boilers -- Unit 1, started up in 1967, and Unit 2, originally supplied by B&W in 1968. B&W will supply wet flue-gas desulfurization ("WFGD") systems, commonly called scrubbers, for each unit including absorber areas and a common reagent preparation and dewatering system.

B&W's advanced WFGD systems operate by mixing a limestone slurry (reagent) with flue gas generated from the combustion of fossil fuel in large steam generators. B&W's WFGD system features include B&W's uniquely designed absorber module and B&W's patented flue gas distribution tray, which in combination are capable of achieving greater than 95 percent sulfur dioxide ("SO2") removal from plant emissions.

"B&W has a long-standing reputation as a leader in generating proven, reliable environmental solutions for the power industry," said Brandon C. Bethards, president of B&W's Fossil Power Group. "We've had a presence at the Fort Martin plant from its beginning, and this new order represents this customer's continued trust in B&W's technology and capabilities."

Engineering for the project is underway at B&W's Barberton headquarters. Mechanical completion of the units is slated for early spring of 2009, with start-up scheduled for the early fall of 2009.

B&W is also performing similar work at Allegheny Energy's Hatfield's Ferry Power Station, located in Masontown, Pennsylvania. The WFGD systems being installed on Hatfield's Ferry's three units are on schedule for completion in fall 2008.

Headquartered in Greensburg, Pennsylvania, Allegheny Energy is an investor-owned electric utility with total annual revenues of over $3 billion and more than 4,000 employees. The company owns and operates generating facilities and delivers low-cost, reliable electric service to over 1.5 million customers in Pennsylvania, West Virginia, Maryland and Virginia. For more information, visit our Web site at www.alleghenyenergy.com.

McDermott is an engineering and construction company, with specialty manufacturing and service capabilities, focused on energy infrastructure. McDermott's customers are predominantly utilities and other power generators, major and national oil companies, and the United States Government. With its global operations, McDermott operates in over 20 countries with more than 20,000 employees, and can be found on the internet at www.mcdermott.com.

In accordance with the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, McDermott International, Inc. cautions that statements in this press release which are forward-looking and provide other than historical information involve risks and uncertainties that may impact McDermott's actual results of operations. The forward-looking statements in this press release include, among other things, work scope and timing associated with the Fort Martin Power Station project. Although McDermott's management believes that the expectations reflected in those forward-looking statements are reasonable, McDermott can give no assurance that those expectations will prove to have been correct. Those statements are made based on various underlying assumptions and are subject to numerous uncertainties and risks, including without limitation change orders and other modifications to contracts. If one or more of these risks materialize, or if underlying assumptions prove incorrect, actual results may vary materially from those expected. For a more complete discussion of these risk factors, please see McDermott's annual report on Form 10-K for the year ended December 31, 2006 filed with the Securities and Exchange Commission.