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Balfour Beatty wins £380 million National Grid Transco Greater Manchester Alliance contract

Balfour Beatty, the international engineering, construction and services group, announces that it has today signed a partnership contract with National Grid Transco (NGT) for the Greater Manchester Alliance gas mains network. The contract, one of four such regional alliances, will be worth some £48 million per annum over an initial eight-year term.

Under the contract, which carries an extension option of a further five years, Balfour Beatty will act as Alliance partner to support NGT’s 30-year gas mains network replacement and abandonment programme. The contract involves the project design, management and construction work required to replace Victorian metallic gas mains in the Greater Manchester Region with modern pipework systems. It is one of four such contracts let as part of NGT’s very significant investment programme to maintain safe and reliable gas supplies across the country. Work will commence in April 2005.

Commenting on the award, Ian Tyler, Balfour Beatty Chief Executive, said today: “We are delighted to have been chosen by National Grid Transco to work in partnership with them under this innovative contract which utilises Balfour Beatty’s design, planning, project management and engineering skills to complement NGT’s. The range of key skills available, in combination, from within the Group is seeing Balfour Beatty winning an increasing share of major business in the gas, water and electricity utilities.”

The Greater Manchester Alliance will draw upon the multi-disciplinary skills and experience of the Balfour Beatty Group. Balfour Beatty Management is the Group’s professional services company, which specialises in partnering and programme management. It provides industry-wide skills, integrated with international construction experience, that deliver infrastructure schemes from concept and assembly through construction to operating and maintenance. Balfour Beatty Utilities provides a complete asset maintenance and replacement service for the gas, water and waste water sectors including investigation, design, construction and commissioning.

Balfour Beatty has been working under a development contract since late last year, under which final arrangements have been defined and agreed for the main contract and for mobilisation up to April 2005.

Enquiries to:

Tim Sharp
Tel: 020 7216 6884

www.balfourbeatty.com

Notes to Editors

1. Established in 2003, Balfour Beatty Management comprises some 250 professional staff specialising in programme and project management together with technical management consultancy expertise covering design, engineering, systems, procurement and commercial services. Its current projects include:
   • Programme management of the Kings Cross Station complex for the Department for Transport
     
   • The development of pan-European rail interoperability standards for the European Union
     
   • Construction management services for BAA at Heathrow.

2. Balfour Beatty Utilities is a leader in the UK market for utility asset management, maintenance and replacement. It has major long-term contracts with a range of utilities, including Yorkshire Water, Anglian Water, Three Valleys Water, United Utilities and South-West Water. The company was formed in late 2002 by the integration of John Kennedy and Kentons, established utilities contractors acquired by Balfour Beatty in 2001 and 2002 respectively.

3. Balfour Beatty is already a major supplier to NGT through its subsidiary, Balfour Beatty Power Networks (BBPN), the UK’s leading specialist in the design and construction of power transmission and distribution networks for the power supply industry and industrial customers. BBPN was recently awarded the UK’s largest ever transmission line upgrade contract.

4. Balfour Beatty is a world-class engineering, construction and services group, well positioned in infrastructure markets which offer significant growth potential. Its partnerships with public and private customers generate secure, sustainable income. Its financial position, with significant net cash and with strong operating cash flows, offers continuing flexibility to add additional capacity and expertise to the business mix and to make appropriate investments in PPP and other long-term growth opportunities.