Major Contract Award

Costain Group PLC
12 March 2007

Costain Group PLC
('Costain' or the 'Group')



Major Education Contract Award

The Board of Costain announces that its joint venture partnership with VT Group
('Learning21') has secured preferred bidder status on a 25-year £400 million
schools partnership contract for the London Borough of Lewisham.  The contract
includes an initial priority capital expenditure programme of over £210 million
on school refurbishment and rebuilding through PFI and traditional forms of
contract.



The contract in Lewisham is part of the Government's Building Schools for the
Future ('BSF') programme, an initiative to rebuild, refurbish and re-equip all
secondary schools in England.



Detailed negotiations have commenced with a view to agreeing a final contract
later this year.



Learning21 will manage the procurement and supply chain to deliver the major
refurbishment or renewal of 12 secondary schools, including three special needs
schools, in the Borough. This will involve construction, to be carried out by
Costain, and the provision of ICT, support services and facilities management,
which will be the responsibility of VT Group.



Construction and refurbishment of the schools should be completed by 2013.



This is Costain's second success in the BSF programme having achieved financial
close on the Bradford Project in December 2006.



Commenting on the award, Andrew Wyllie, Chief Executive of Costain, said:



'We are delighted to have secured preferred bidder status on this major project.
  The award is evidence of the benefits of focusing on key sectors as part of
our Being Number One strategy, and significantly strengthens our presence in
Education having recently reached financial close on Bradford BSF.'



                                                                   12 March 2007





Enquiries:
Costain                                        Tel: [phone]
Andrew Wyllie, Chief Executive
Tony Bickerstaff, Finance Director
Graham Read, Public Relations

College Hill                                   Tel: [phone]
Mark Garraway
Matthew Gregorowski




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