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The Shaw Group Awarded First Phase of Housing Project by U.S. Army to Privatize Fort Leonard Wood in Missouri
The Company Partners with CEI Investment Corp. to Develop Community Development Master Plan to Benefit More Than 2,200 Military Families

BATON ROUGE, La., Dec 19, 2003 (BUSINESS WIRE) -- The Shaw Group Inc. (NYSE:SGR) today announced that American Eagle Communities, LLC, a 50/50 joint venture between subsidiary Shaw Infrastructure, Inc. and CEI Investment Corp., was recently selected by the U.S. Army to execute the Community Development and Management Plan (CDMP) for the privatization of Fort Leonard Wood's more than 2,200 military family housing units in Missouri. Once finalized, the CDMP will serve as the blueprint for the development of this residential community project which is expected to have an overall value exceeding $1 billion. The CDMP is part of the Army's Residential Communities Initiative (RCI), a plan to privatize Army family housing throughout the United States.

American Eagle Communities will begin work on the Fort Leonard Wood project in January 2004. The first phase includes completing the CDMP, which details the phasing and construction timeline as well as the design and approach to the project. Upon Congressional approval of this plan, expected sometime in the summer of 2004, American Eagle Communities will begin a six-year development program that includes renovating and/or rebuilding all of Fort Leonard Wood's 2,200-plus military family homes. The goal is to revitalize and modernize the base's military housing and enrich the quality of life for the families residing at Fort Leonard Wood by creating recreational spaces throughout the planned communities.

"This is a major milestone for the Army at Fort Leonard Wood and for the service members who defend our freedom," stated Tim Barfield, President and COO of The Shaw Group. "We are proud to be assisting the Army in achieving its housing privatization goals through this innovative partnership and look forward to delivering a community with amenities consistent with those found in the private sector."

"Shaw is especially excited about this project and the rapid growth of the Company's Infrastructure group. We entered the housing privatization market last year with an Air Force project in Florida and have found it to be a very rewarding experience. We are pleased to once again be partnered with CEI and look forward to continuing this type of work on a larger scale in Missouri," Barfield concluded.

The proposed plan also includes a fifty-year operations and maintenance agreement whereby American Eagle Communities will provide comprehensive resident care services for the military families living in Fort Leonard Wood's privatized residential community. Resident care services include home interior, exterior and grounds maintenance. American Eagle Communities will also maintain common areas and parks and will construct and maintain roads and infrastructure within the housing community.

Headquartered in Meriden, Conn., CEI Investment is a 50-year-old family-owned business that has developed more than 35,000 homes across the United States. The company has extensive expertise in the development and management of master-planned communities, multi-family communities, as well as communities committed to environmental preservation. CEI Investment has a remarkable tenant satisfaction and retention rate within its managed developments, with 97 percent occupancy and an average tenant stay in excess of five years. In addition, the ongoing commitment of CEI Investment to its properties far exceed industry standards, with CEI Investment maintaining ownership and management of a majority of its developments for more than 30 years.

The Shaw Group Inc. is a leading global provider of engineering, procurement, construction, maintenance, fabrication, manufacturing, consulting, remediation, and facilities management services for government and private sector clients in the power, process, environmental, infrastructure and homeland defense markets. The Company is headquartered in Baton Rouge, Louisiana, and employs approximately 14,800 people at its offices and operations in North America, South America, Europe, the Middle East and the Asia-Pacific region. For further information, please visit the Company's 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 herein that are not historical facts (including without limitation statements to the effect that the Company or its management "believes," "expects," "anticipates," "plans," or other similar expressions) and statements related to revenues, earnings, backlog, or other financial information or results 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 our control) and assumptions and are subject to change based upon various factors. Should one or more of such risks or uncertainties materialize, or should any of our 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. A description of some of the risks and uncertainties that could cause actual results to differ materially from such forward-looking statements can be found in the Company's reports and registration statements filed with the Securities and Exchange Commission, including its Form 10-K and Form 10-Q reports, and on the Company's website under the heading "Forward Looking Statement". These documents are also available from the Securities and Exchange Commission or from the Investor Relations department of Shaw. For more information on the company and announcements it makes from time to time on a regional basis visit our website at www.shawgrp.com.

SOURCE: The Shaw Group Inc.

The Shaw Group Inc., Baton Rouge
Investor Relations:
Laurie LaChiusa, 225-932-2500
www.shawgrp.com
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"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding SHAW GROUP INC's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.


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