News Release

BATON ROUGE, La.--(BUSINESS WIRE)--Aug. 23, 2001--The Shaw Group Inc. (NYSE:SGR) ("Shaw" or the "Company") today announced that it has signed separate agreements with two leading independent power producers to construct two power plants totaling 840 megawatts.

Under the first agreement, Shaw will provide engineering, procurement and construction services for a 270 megawatt combined-cycle power plant to be located in the Northwestern United States. Shaw has begun engineering on the project and groundbreaking is currently scheduled for October 2001. The plant is scheduled to be complete and in commercial operation by the summer of 2003.

In an agreement with a separate independent power producer, Shaw will provide engineering, procurement and construction services for a 570 megawatt simple-cycle power plant to be located in the Southeastern United States. Engineering work has already commenced on the plant and groundbreaking is expected immediately. The plant is scheduled to be complete and in commercial operation by the summer of 2002.

Stone & Webster, a subsidiary of The Shaw Group, will execute the engineering, procurement and construction services for both projects.

J.M. Bernhard, Jr., Shaw's Chairman, President and Chief Executive Officer, stated, "These projects are a clear indication that we are continuing to book new work and increase our backlog as a result of ongoing activity in the domestic power market. Further, we are very pleased with our business model as it continues to develop strength through the success of numerous multi-project relationships with key customers in the industry."

The Shaw Group Inc. is the world's only vertically integrated provider of complete piping systems and comprehensive engineering, procurement and construction services to the power generation industry. Shaw is the largest supplier of fabricated piping systems in the United States and a leading supplier worldwide, having installed piping systems in power plants with an aggregate generation capacity in excess of 200,000 megawatts. While the majority of Shaw's backlog is attributable to the power generation industry, the Company also does work in the process industries, including petrochemical, chemical and refining, and the environmental and infrastructure sector. The Company currently has offices and operations in North America, South America, Europe, the Middle East and Asia-Pacific; and has more than 13,000 employees. For more information on Shaw, please visit our website at www.shawgrp.com.

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for certain forward-looking statements. The statements contained in this press release that are not historical facts (including without limitation statements to the effect that The Shaw Group Inc. (the "Company" or "Shaw") or its management "believes," "expects," "anticipates," "plans," or other similar expressions) are forward-looking statements based on the Company's current expectations and beliefs concerning future developments and their potential effects on the Company. There can be no assurance that future developments affecting the Company will be those anticipated by the Company. These forward-looking statements involve significant risks and uncertainties (some of which are beyond the control of the Company) and assumptions and are subject to change based upon various factors, including but not limited to the following risks and uncertainties: changes in the demand for and market acceptance of the Company's products and services; changes in general economic conditions, and, specifically, changes in the rate of economic growth in the United States and other major international economies; the presence of competitors with greater financial resources and the impact of competitive products, services and pricing; the cyclical nature of the individual markets in which the Company's customers operate; changes in investment by the energy, power and environmental industries; the availability of qualified engineers and other professional staff needed to execute contracts; the uncertain timing of awards and contracts; cost overruns on fixed, maximum or unit priced contracts; changes in trade, monetary and fiscal policies worldwide; currency fluctuations; the effect of the Company's policies, including but not limited to the amount and rate of growth of Company expenses; the continued availability to the Company of adequate funding sources; delays or difficulties in the production, delivery or installation of products and the provision of services; the ability of the Company to successfully integrate the operations of Stone & Webster, Incorporated; the protection and validity of patents and other intellectual property; and various legal, regulatory and litigation risks. Should one or more of these risks or uncertainties materialize, or should any of the Company's assumptions prove incorrect, actual results may vary in material respects from those projected in the forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. For a more detailed discussion of some of the foregoing risks and uncertainties, see the Company's filings with the Securities and Exchange Commission.

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