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Balfour Beatty signs contract for up to £550 million Eastern overhead line and cable alliance with National Grid plc

Balfour Beatty, the international engineering, construction and services group, announces today that it has signed a contract with National Grid for a new five-year alliance, likely to be worth approximately £550 million, to upgrade and develop the electricity transmission network in the eastern half of England. There is an option to extend the alliance for a further five years.

Commenting today, Balfour Beatty Chief Executive, Ian Tyler, said:

“We are delighted to have signed this innovative contract with National Grid as their alliance partner and to be given the opportunity to utilise Balfour Beatty’s design, planning, project management, engineering and construction skills, in combination. Our ability to deliver a multi-disciplinary, integrated service is an increasingly important factor in driving our growth and in enhancing our relationships with blue-chip infrastructure customers.”

The alliance contract, which is part of one of the largest procurement exercises undertaken by National Grid, will support their increased investment in the electricity transmission network and contribute to long-term security of supply. The works are required to connect new infrastructure such as wind farms and new generation plant to the Grid. They will also cover the enhancement and replacement of existing assets.

The contract, which will come into force in March 2007, is one of two overhead line and four sub-station alliance contracts due to be signed by National Grid in the coming weeks.

Balfour Beatty is the leading UK supplier of power transmission and distribution networks to the international power supply industry. It is also a partner to National Grid in its 30-year gas mains network replacement programme for the North West of England, under an eight year alliance contract worth approaching £400 million.

ENDS

Enquiries to:

Tim Sharp
Tel: 020 7216 6884
www.balfourbeatty.com

Notes to Editors

1. The contract will be delivered using the skills and resources of Balfour Beatty Power Networks, the leading specialist in the design and construction of power transmissions and distribution networks, and Balfour Beatty Management, the Group’s professional and technical services company which specialises in programme and project management and technical management consulting.
2. 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, long-term 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/PFI and other long-term growth opportunities.