Graham Corporation Wins $4 Million Contract for Petrochemical Plant

Business Wire, July 11, 2005

BATAVIA, N.Y. -- Graham Corporation (AMEX: GHM), a global designer, manufacturer, and supplier of ejectors, pumps, condensers, vacuum systems and heat exchangers for the oil refining, petrochemical and power generation industries, today announced it received an order valued at over $4 million for four surface condensers. The equipment will be installed in the Middle East in one of the largest integrated refining and petrochemical complexes to be built at one time and will specifically be a part of the petrochemical process resulting in the production of ethylene products. Two condensers are planned for shipment in the first quarter of fiscal 2007, which ends June 30, 2006, and the remaining two in the third quarter of fiscal year 2007 ending December 31, 2006. Revenue will be recognized on a long-term contract accounting basis, and approximately 15% of the project will be recognized in Graham's current 2006 fiscal year and the remaining 85% in fiscal year 2007.

Bill Johnson, President and CEO of Graham Corporation commented, "This is our second Middle East ethylene plant contract in just the past three months. Although there is strong international competition to supply equipment for these large projects, Graham has a strong brand name and proven track record for the successful integration of equipment into refineries and petrochemical plants located in the Middle East. It is a testament to Graham's commitment of providing custom engineered solutions, quality products and on-time delivery that we have been successful in securing these contracts."

Johnson goes on to say, "Ethylene capacity is expected to more than double over the next 10 years, 40% of which will be added in the Middle East. Several large petrochemical plants are currently being planned for start-up over the next two years in the Middle East, and with our focused sales strategy, we intend to capitalize on these future opportunities."

ABOUT GRAHAM CORPORATION

With world-renowned engineering expertise in vacuum and heat transfer technology, Graham Corporation is a global designer, manufacturer and supplier of ejectors, pumps, condensers, vacuum systems and heat exchangers. Over the past 70 years, Graham Corporation has built a reputation for top quality, reliable products and high-standards of customer service. Sold either as components or complete system solutions, the principle markets for Graham's equipment are the petrochemical, oil refining and electric power generation industries, including cogeneration and geothermal plants. Graham equipment can be found in diverse applications, such as metal refining, pulp and paper processing, ship-building, water heating, refrigeration, desalination, food processing, drugs, heating, ventilating and air conditioning.

Graham Corporation's reach spans the globe. Its equipment is installed in facilities from North and South America to Europe, Asia, Africa and the Middle East. More information regarding Graham can be found at its website: www.graham-mfg.com

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All forward-looking statements are subject to certain risks, uncertainties and assumptions. These risks and uncertainties, which are more fully described in Graham's Annual and Quarterly Reports filed with the Securities and Exchange Commission, include the Company's ability to successfully execute the contract, that the estimated value of the production contract will be realized, customer preferences and changes in market conditions in the industries in which the Company operates. Should one or more of these risks or uncertainties materialize, or should the assumptions prove incorrect, actual results may vary in material aspects from those currently anticipated.