Re Contract

Balfour Beatty PLC
11 February 2005

11 February 2005



             BALFOUR BEATTY WINS £380 MILLION NATIONAL GRID TRANSCO
                      GREATER MANCHESTER ALLIANCE CONTRACT
                      ====================================

            Balfour Beatty Utilities and Balfour Beatty Management in
                          eight-year alliance agreement
                          -----------------------------


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.

                                      ENDS

Enquiries to:
Tim Sharp
Tel: [phone]
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.



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