Safeway Names Winners in the Lucerne(R) "The Art of Dairy"(TM) Contest.

30 Finalist Students Attending Schools From 11 States Decorated Life-Sized Plaster Cows in Competition for $22,000 Grand Prize

PLEASANTON, Calif. -- Safeway Inc. (NYSE:SWY) announced today its grand prize, first prize and honorable mention winners of the Lucerne(R) The Art of Dairy(TM) "Cows & History" Art Contest. The program, started in 2006, invites thousands of students and classrooms from across the country to participate in a special educational instruction to promote artistic creativity, academic excellence and healthy lifestyles.

Seventeen-year-old Mary Regina Bolgiano from Notre Dame Preparatory in Towson, Md., was named the contest's grand prize winner for her "Revol-moo-tion" design. She will receive $20,000 for her school's art department, plus $1,000 each for herself and her art teacher. According to Mary Regina, she and friends spent many hours over several weeks creating the design.

First prize winner, 16-year-old Tonia Lee from McNary High School in Keizer, Oregon, will receive $1,000 for her school's art department, plus $750 each for herself and her art teacher for her "Cattle of Kings" design. Safeway also named three honorable mention winners:

* 18-year-old Emanuel Rios, Gilbert High School, Gilbert, Ariz.

* 16-year-old Xin Xin Lin, Castro Valley High School, Castro Valley, Calif.

* 15-year-old Jessie Chen, Sammamish High School, Bellevue, Wash.

"Safeway is proud of the winners and all those who participated in this contest, which promotes education and the arts in schools throughout the country," said Safeway Executive Vice President and Safeway Foundation Chair Larree Renda. "The outstanding creativity and dedication these students showed is extremely impressive, and we applaud everyone's efforts."

The Art of Dairy contest is just one of the many ways Safeway is involved in education-based initiatives. The company has long recognized the critically important role education plays in building strong communities and ensuring their future growth. Since 2000 Safeway has donated more than $130 million -- $22 million in 2006 -- to support education and schools through its eScrip program and other education projects. The eScrip program allows shoppers to raise money for schools simply by making purchases. Safeway donates a percentage of each shopping trip directly to their chosen school.

Using cows as the focal point to promote dairy products as healthy snack alternatives for kids, Safeway, the maker of Lucerne(R) dairy products, asked students ages 12 to 18 to submit designs based on the theme "Cows & History" using an outline of a cow as the canvas. Entries were accepted from October 16, 2006 to December 1, 2006. More than 9,000 middle school and high school students from as far away as Alaska and Hawaii submitted entries.

The 30 finalists then transferred their designs to life-sized ceramic cow sculptures in the final phase of the competition. A panel of judges reviewed the entries and selected contest winners. A special website, located at www.safeway.com/lucerne has been created that showcases past and current winners and includes healthy recipes and contest information.

ABOUT SAFEWAY

Safeway Inc. is a Fortune 100 company and one of the largest food and drug retailers in North America, based on sales. The company operates 1,761 stores in the United States and western Canada and had annual sales of $40.2 billion in 2006. Safeway supports a broad range of charitable and community programs and last year donated more than $154 million to important causes, such as cancer research, education, food banks and programs focused on assisting people with disabilities. The company's common stock is traded on the New York Stock Exchange under the symbol SWY.