MFRI Reports $26 Million in New Orders for Its Glass Syntatic Polyurethane (GSPU) Insulation System for Sub-Sea Oil and Gas Flowlines and Risers.

NILES, Ill. -- MFRI, Inc. (NASDAQ NM: MFRI), a leading manufacturer of specialty piping systems, custom-designed industrial filtration products and of industrial process cooling equipment, announced today that its Perma-Pipe subsidiary has received additional orders for its "Autotherm[TM]", automatically applied GSPU thermal insulation system for oil and gas sub-sea flowlines .

Perma-Pipe, Inc. a wholly owned subsidiary of MFRI, Inc. (MFRI:NASDAQ), has recently received 4 significant orders totaling approximately $26,000,000 from Major and Independent multinational oil and gas companies. Perma-Pipe will apply Glass Syntactic Polyurethane (GSPU) insulation to pipelines that will be installed in the Gulf of Mexico. Perma-Pipe's Autotherm[TM] GSPU is a thermal insulation process and system that applies specially formulated polyurethane compounds to the exterior of steel pipes to be incorporated into oil and gas flowlines and risers connecting sub-sea wells to their host platforms.

The Autotherm[TM] system is designed to provide reliable insulation properties when subjected to the cold seawater temperatures and significant hydrostatic pressures in deep water over the anticipated service life of the sub-sea oil wells. These pipelines will be installed in water depths up to 10,000 feet. Insulating sub-sea oil flow lines is a common practice at these water depths in order to assure continuous flow and prevent paraffin or hydrate buildup on the internal pipe surface.

"These orders significantly increase the backlog for our oil and gas pipeline processing facility in New Iberia, Louisiana and demonstrate the confidence of major multi-national oil companies in the quality of our process (patent pending) and products as well as our competence in serving this very important but demanding market". Fati Elgendy, President of Perma- Pipe, Inc. said.

"We are pleased to receive these orders and we anticipate that the requirement for insulated sub-sea infield pipelines in the Gulf of Mexico and elsewhere will continue to be active as oil and gas producing companies tie-in sub-sea producing fields to new and existing platforms", said David Unger, Chairman and CEO of MFRI, Inc.

The work described above has been secured through Bayou Flow Technologies, L.L.C. a partnership of MFRI's subsidiary, Perma-Pipe, Inc. The Bayou Companies L.L.C. and Cuming Insulation Corporation, formed to market coating, insulation and fabrication of sub-sea pipelines and structures to the oil industry.

The Company anticipates that this new work will commence in the second quarter of 2007 and be mostly completed during 2007. Due to the seasonality of the Company's Piping Systems business, sales and earnings are typically higher during the late spring, summer and early fall months (second and third quarters), due to favorable weather for construction over much of North America and correspondingly lower during the late fall, winter and early spring months (fourth and first quarters).

For more information visit the Company's website <www.mfri.com> or contact the company directly.

Statements and other information contained in this announcement which can be identified by the use of forward-looking terminology such as "anticipate," "may," "will," "expect," "continue," "remain," "intend," "aim," "should," "prospects," "could," "future," "potential," believes," "plans," "likely," and "probable," or the negative thereof or other variations thereon or comparable terminology, constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934 as amended and are subject to the safe harbors created thereby. These statements should be considered as subject to the many risks and uncertainties that exist in the Company's operations and business environment. Such risks and uncertainties include, but are not limited to, economic conditions, market demand and pricing, competitive and cost factors, raw material availability and prices, global interest rates, currency exchange rates, labor relations and other risk factors.