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Shaw Awarded Community Development and Management Plan Contract by U.S. Army for Three Northeast Region Military Bases

BATON ROUGE, La.--(BUSINESS WIRE)--July 28, 2004--The Shaw Group Inc. (NYSE: SGR) today announced that American Eagle Communities, LLC, a joint venture owned 50 percent by Shaw Infrastructure, Inc. and 50 percent by CEI Investment Corp., was recently selected by the U.S. Army to prepare the Community Development and Management Plan (CDMP) for the privatization of housing units at three facilities in the northeastern United States. Once finalized, the CDMP will serve as the master plan for the development of enhanced residential communities at Carlisle Barracks, in Pennsylvania, and Fort Monmouth and Picatinny Arsenal, both in New Jersey. In total, the three locations are expected to include approximately 780 housing units for military personnel and their families and to be valued at over $150 million. This Northeast region project is part of the Army's Residential Communities Initiative (RCI), a plan to privatize and improve Army family housing throughout the United States.

American Eagle Communities will work with Army representatives at each location to develop the CDMP which will serve as the 50-year business plan for the project. The CDMP will establish the phasing and construction timeline as well as the design and approach to the project at each location. Preparation of the CDMP is expected to take about six months. Upon approval of the CDMP, American Eagle Communities will begin an approximate four-year development program that includes renovating and/or rebuilding all of the residences at the three project locations.

Diana Severs Ferguson, President of Shaw Environmental and Infrastructure, Inc., said, "This combined site award firmly establishes Shaw as a trusted provider of privatization services to the military and a major player in the overall infrastructure privatization market. Our partnerships with CEI on previous military housing privatization projects have been very successful and we are pleased to work with them again to enhance the residential facilities for the Army's personnel and their families at these three Northeast Region locations."

Approximately $150 million in private sector financing will be invested in the project during the initial four-year development phase to renovate existing and construct new family housing at the three installations. The plan will improve overall housing appearance and functionality and weave natural and historical elements together as part of the planned communities. Recreational spaces will be created at each location which may include clubhouses, ancillary facilities and other amenities to enrich the quality of life for the residents.

The proposed plan also includes a fifty-year operations and maintenance agreement whereby American Eagle Communities will provide comprehensive residential services, including interior, exterior and grounds maintenance, for the residents at each of the project's sites. American Eagle Communities will also construct and maintain roads and infrastructure within the housing communities.

Headquartered in Meriden, Connecticut, CEI Investment is a 50-year-old, privately-held firm 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 exceeds 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 provider of consulting, engineering, construction, remediation and facilities management services to government and private sector clients in the environmental, infrastructure and emergency response markets. The Shaw Group is also a vertically integrated provider of comprehensive engineering, consulting, procurement, pipe fabrication, construction and maintenance services to the power and process industries worldwide. A Fortune 500 company with $3.3 billion in revenues in 2003, The Shaw Group debuted on the magazine's "America's Most Admired Companies" list in 2004. Shaw is headquartered in Baton Rouge, Louisiana and employs approximately 17,000 people at its offices and operations in North America, South America, Europe, the Middle East and the Asia-Pacific region. Additional information on The Shaw Group is available 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 Statements". 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.

    CONTACT: The Shaw Group Inc.
             Chris D. Sammons, 225-932-2546
    SOURCE: The Shaw Group Inc.
"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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