Re Contract

Balfour Beatty PLC
23 October 2006


23 October 2006

                      BALFOUR BEATTY JOINT VENTURE AWARDED
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                     £363 MILLION EAST LONDON LINE CONTRACT
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  London's first purpose-built metro rail service to be ready in time for the
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                                    Olympics
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Balfour Beatty, the international engineering, construction and services group,
announces today that, in joint venture with Carillion, it has been awarded the
£363 million contract to create the new East London rail line between Dalston
Junction in the North and West Croydon in the South, by Transport for London
(TFL).

The project, which is the first of two phases, will extend the existing East
London Line to Dalston Junction in the North and New Cross Crystal Palace and
West Croydon in the South. It is scheduled for completion in late 2010.
Construction works will begin in early 2007. Some additional work, not covered
by the base contract for Phase1 could be commissioned from the joint venture
over the next few months.

Commenting today, Balfour Beatty Chief Executive Ian Tyler said:
'We are delighted to have been selected to deliver this project, which is the
cornerstone of Transport for London and the Mayor's £10 billion investment
programme to give London a 21st century transport system. Balfour Beatty's
strong multi-disciplinary capabilities and project management skills are ideally
suited to complex major infrastructure developments of this kind and we look
forward to delivering a key part of London's transport infrastructure.'

Phase 2 of the project will further extend the line west to Clapham Junction and
connect the North London Line stations at Canonbury and Highbury & Islington.

Proposals to build the new line helped to underpin London's successful bid for
the 2012 Olympic Games. The project will not only play a major role in
transporting people to and from the 2012 Olympic Games, but also trigger
substantial development and regeneration initiatives in some of London's most
deprived boroughs.

The contract will involve railway works including track, signalling,
telecommunications and electrification, and major civil engineering works
including the construction of two large new bridges, new stations and a new
depot at New Cross Gate.

Balfour Beatty and Carillion are market leaders in the provision of training in
the construction sector and are uniquely placed to deliver TFL's requirements
for equality, inclusion and diversity through the employment and training of
local people.

                                      ENDS


Enquiries to:-

Tim Sharp
Tel: [phone]
www.balfour.beatty.com


Notes to Editors

 1. Balfour Beatty has a long, successful track record of working on major
    projects to improve London's infrastructure. For example, it recently
    completed construction of the new University College London Hospital, is
    carrying out the rail and station works at Heathrow Terminal 5 and
    remodelled the entire rail infrastructure approaches to Euston station. It
    is building new schools in East London; is a major builder of affordable
    housing; played lead roles in the creation of the Emirates Stadium and the
    grandstand at Lord's Cricket Ground and has carried out major renovation
    projects at Kew Gardens, the Natural History Museum, the Palace of
    Westminster and Somerset House.


 2. Balfour Beatty has carried out a number of successful projects in joint
    venture with Carillion, including the West Coast Mainline Overhead Line
    project for Network Rail and the construction of the M6 toll-way in the
    Midlands.


 3. Balfour Beatty is a 20% owner of Metronet, which is responsible, under a 30
    year PPP contract for upgrading and maintaining approximately three-quarters
    of the London Underground system.


 4. Balfour Beatty is a key member of the Powerlink consortium responsible for
    upgrading and maintaining the power supply system for London Underground.


 5. 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.




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