KBR Awarded Construction and Fabrication Services Contract for Canadian Bitumen Refining Project

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May 28, 2008

KBR (NYSE:KBR) announced today that it has been awarded a $275 million (CAD) contract for construction and fabrication of an LCFiner unit by North West Upgrading (North West), a Calgary-based, privately-owned company building an independent, heavy oil upgrader in Sturgeon County, Alberta.

The LCFiner unit scope will include the prefabrication of 40 modules to be later assembled as part of the North West Upgrading project. The project is expected to last approximately 30 months and will peak with approximately 450 personnel.

"We are pleased about this exciting opportunity to continue to work with North West on this world class project," said David Zimmerman, President, KBR Services. "This award further demonstrates KBR's commitment to growth in the Canadian oil sands market."

"This award marks the second contract KBR has secured for this project and reinforces our standing as a market leader in fabrication and construction in Canada," said Chris Brown, Vice President, KBR Services, Canada. "Our expertise in executing complex projects in remote areas is a key virtue of our ability to continue to add to our impressive list of projects such as North West Upgrading."

KBR was awarded the construction and fabrication services subcontract for the project gasifier by Lurgi AG of Frankfurt, Germany in 2007. The North West Upgrading project will have an initial design capacity to process 77,000 barrels of oil sand's SYNBIT/DILBIT mix bitumen feed per day. Two subsequent phases, each of identical capacity, are planned for implementation in the future.


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