Babcock & Wilcox Wins U.S. $37 Million Environmental Contract from Dominion Generation.

Business Editors

BARBERTON, Ohio--(BUSINESS WIRE)--Dec. 10, 2001

The Babcock & Wilcox Company (B&W), a unit of McDermott International, Inc. (NYSE:MDR), has been awarded a contract to engineer, procure the materials for and construct an environmental system to reduce nitrogen oxide (NOx) from Dominion Generation's Chesapeake Energy Center near Norfolk, Virginia.

The contract, valued at more than $37 million, calls for B&W to supply selective catalytic reduction systems (SCRs) for Chesapeake's Units 3 and 4. The scope includes flues, catalyst vessels, pressure part modifications, and dampers. These modifications will reduce the two coal-fired units' emissions levels by 90 percent.

"We are pleased to have been chosen by Dominion for this important project," said David L. Keller, B&W's chief operating officer. "We have a solid track record in the successful implementation of NOx reduction solutions, and we're looking forward to working with the Chesapeake team to write yet another success story."

Engineering for the project will be completed at B&W's Barberton headquarters by the first quarter of 2002. B&W's West Point, Mississippi plant will assist with the manufacture of various components including tubing. Construction is scheduled to begin in April 2002, with the systems scheduled to be in operation by the spring of 2004.

Unit 3 is a 166-megawatt (MW) pulverized coal, balanced draft radiant boiler originally supplied in 1958. Unit 4 (224 MW) was supplied in 1962.

Babcock & Wilcox is located on the Internet at www.babcock.com. Journalists will find company news, fact sheets, and industry links at http://www.babcock.com/pgg/pr/pressroom.html.

Though there are many power generation companies that contain the name Babcock, the U.S.-based Babcock & Wilcox is the original, founded by George Babcock and Stephen Wilcox in 1867.

McDermott International, Inc. is a leading worldwide energy services company. The company's subsidiaries manufacture steam-generating equipment, environmental equipment, and products for the U.S. government. They also provide design, engineering, fabrication and installation services to the oil and natural gas industries for offshore production facilities and pipelines.

Statements in this release which express a belief, expectation or intention, as well as those which are not historical fact, are forward looking. They involve a number of risks and uncertainties which may cause actual results to differ materially from such forward-looking statements. These risks and uncertainties include factors detailed from time to time in the company's filings with the Securities and Exchange Commission, including its Form 10-Q for the period ending September 30, 2001.