Re Contract

Balfour Beatty PLC
20 March 2006


20 March 2006


            GAMMON CONSTRUCTION AWARDED HONG KONG $2 BILLION CONTRACT
                TO BUILD 70-STOREY OFFICE BUILDING IN HONG KONG
                ===============================================

Balfour Beatty, the international engineering, construction and services group,
announces today that Gammon Construction, Hong Kong's leading engineering and
construction group in which Balfour Beatty has a 50% interest, has been awarded
the Hong Kong $2billion (£150 million) contract to build One Island East by
Swire Properties.

The contract is for a 70-storey, 1.5 million square feet, Grade A office
building on the Eastern shore of Hong Kong island. One Island East will be the
latest element in Swire Properties' comprehensive commercial development in the
area which has already attracted over 300 multinational companies.

Commenting today on the contract award, Balfour Beatty Chief Executive,
Ian Tyler, said:

'We are delighted to have been selected to build this major addition to one of
Hong Kong's best planned and established business districts. Gammon has a
successful and long-standing relationship with the Swire Group and the two
companies have jointly developed a number of innovative techniques to accelerate
construction and protect the environment before, during and after construction.'

The project is scheduled for completion in March 2008 and will enjoy a
pioneering project management system to facilitate collaboration across all
construction disciplines. Swire Properties is one of Hong Kong's leading
developers with extensive experience in the development and management of major
commercial retail and residential properties.

                                      ENDS

Enquiries to:

Tim Sharp
Tel: [phone]
www.balfourbeatty.com


Notes to Editors
----------------

1.  Gammon Construction is Hong Kong's leading engineering and construction
    group with annual sales of approximately £500 million, over 2,000 full time
    staff including some 450 professional employees and one of the strongest 
    technical teams in Asia as a whole.

2.  Gammon's current projects include:

    - The Venetian Hotel and Casino Complex in Macao, comprising construction 
      and electrical and mechanical work to a total value of approximately £230
      million

    - The Kowloon South Rail Link comprising West Kowloon Station and the 
      connecting tunnel valued at £140 million

    - The Hong Kong section of Hong Kong - Shenzhen Western Corridor comprising
      construction of a 3.5 km long dual three-lane carriageway valued at HK$2.2
      billion (£162 million).

3.  Balfour Beatty acquired 50% of Gammon in August 2004. Subsequently it merged
    its existing Hong Kong engineering and construction interest into the Gammon
    organisation.

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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