KBR Awarded Contracts for Construction and Fabrication Services by Shell Canada for Scotford Upgrader Expansion

Business Wire, May 14, 2007

HOUSTON -- KBR (NYSE:KBR) today announced it has been awarded contracts to provide field construction and module fabrication services by Shell Canada for the Scotford Upgrader Expansion east of Edmonton, Alberta, Canada. KBR's scope of work will include the fabrication of 160 modules and will peak at approximately 800 personnel performing field construction and module services work.

The Scotford Upgrader Expansion project is part of the Athabasca Oil Sands Project (AOSP) Expansion 1, which will add approximately 100,000 barrels per day of capacity to the AOSP bitumen mining and upgrading facilities. AOSP is a joint venture between Shell Canada, Chevron Canada Limited and Western Oil Sands L.P. The total estimated cost of the project is between Cdn$10 billion and $12.8 billion.

Field construction services for the Atmospheric and Vacuum Unit and Sulphur Recovery Unit will commence in mid May 2007. Module fabrication services for the Sulphur Recovery Unit are expected to begin in June and module fabrication services for the Atmospheric and Vacuum Unit are expected to begin in September. The total scope of work is scheduled for completion in March 2010.

"KBR's contract award for the Scotford Upgrader Expansion exemplifies our ongoing commitment to Shell and to the Canadian oil sands market. Our participation in this project will not only allow KBR to showcase its oil sands refining expertise, but it will also demonstrate our standard of excellence relative to project execution and completion," said John Rose, executive vice president, of KBR's Energy and Chemicals business segment.

KBR is a global engineering, construction and services company supporting the energy, petrochemicals, government services and civil infrastructure sectors. We offer our wide range of services through our Energy and Chemicals (E&C), Government and Infrastructure (G&I), and Ventures business segments. For more information, visit www.kbr.com.