McDermott Wins Pipeline Installation Project in Gulf of Mexico

HOUSTON--(BUSINESS WIRE)--McDermott International, Inc. (NYSE:MDR) (“McDermott”), announced today that one of its subsidiaries was awarded a contract by PEMEX Exploración y Producción for procurement, construction and installation of three oil and gas pipelines ranging from 8 to 20 inches in diameter, in Mexico’s Bay of Campeche. The contract is valued at more than US$50 million and will be included in McDermott’s second quarter backlog for 2011.

“We are pleased to be working again for PEMEX in the Gulf of Mexico. Our installation solution for this project will be supported by our subsea engineering design group in Houston and fabrication work from our construction yard in Altamira, Mexico”

“We are pleased to be working again for PEMEX in the Gulf of Mexico. Our installation solution for this project will be supported by our subsea engineering design group in Houston and fabrication work from our construction yard in Altamira, Mexico,” said Stephen M. Johnson, McDermott’s Chairman, President and Chief Executive Officer.

Pipeline installation engineering is expected to begin in the second quarter of 2011, with subsequent fabrication of the risers, clamps and guards, subsea tie-in assembly and additional platform piping and structural items from Altamira. McDermott’s DB16 will perform the installation work, with completion expected by the end of the year.

DB16 is outfitted with a customized Automatic Welding System that offers high weld production rates and production flexibility. The vessel and its crew are recognized for producing repeatable high-quality welds with exceptional mechanical properties. Also impressive is the vessel’s underwater block, capable of lifting large amounts of tonnage into deepwater.

The field development in the Gulf of Mexico sits in approximately 170 feet of water. The pipelines will run from the Kambesah Wells Recoverer Structure to the Kutz TA platform and the Ixtoc-A platform.

More about DB16

DB16 is a dynamically positioned, shallow and deepwater combination barge with the flexibility of installing structures or S-Laying pipe up to 48-inch in diameter. The vessel is equipped with three 100 kip tension machines and five pipelay welding stations, an abandonment and recovery hoist for laying down pipelines in deep water. The DB16’s 200-foot long deep water truss stinger with an A-Frame and an underwater block enables it to lower heavy structures up to 62 tons into water 10,000 feet deep, and lift up to 94.5 tons in water depths of 6,000 feet.

More about Altamira Fabrication Facility

Altamira offers significant advantages for McDermott’s customers such as cost efficiency and space, and with a new enclosed assembly building nearing completion; this facility will offer the largest under cover assembly bays of any of McDermott’s competitors on the Gulf Coast.

Located in the Port of Altamira, Mexico, the McDermott fabrication facility is one hour’s flight time from Houston, Texas and 30 minutes flight time from Brownsville, Texas. Strategically and competitively positioned for turnkey offshore construction of modules, hulls and substructures, as well as rig repair and upgrade services, this expansive yard has direct, unrestricted access to open sea and an extensive 40-foot deep quayside (47.5-feet expected September 2011).

Altamira’s equipment and infrastructure, material flow and management are designed for optimum performance, delivering safe, efficient, cost-effective offshore construction and rig repair and upgrade solutions.

This yard caters to customers throughout the Gulf of Mexico and Atlantic region.

ABOUT McDERMOTT

McDermott is a leading engineering, procurement, construction and installation (“EPCI”) company focused on executing complex offshore oil and gas projects worldwide. Providing fully integrated EPCI services for upstream field developments, the Company delivers fixed and floating production facilities, pipelines and subsea systems from concept to commissioning. McDermott’s customers include national and major energy companies. Operating in more than 20 countries across the Atlantic, Middle East and Asia Pacific, the Company’s integrated resources include more than 15,000 employees and a diversified fleet of marine vessels, fabrication facilities and engineering offices. McDermott has served the energy industry since 1923.

To learn more, please visit McDermott’s website on the internet at www.mcdermott.com

FORWARD LOOKING STATEMENTS

In accordance with the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, McDermott International, Inc. cautions that statements in this press release which are forward-looking and provide other than historical information involve risks and uncertainties that may impact McDermott's actual results of operations. The forward-looking statements in this press release include, among other things, the expected value, scope, execution, and timing associated with this project, and the expected quayside depth and timing of improvements at the Altamira fabrication facility. Although McDermott's management believes that the expectations reflected in those forward-looking statements are reasonable, McDermott can give no assurance that those expectations will prove to have been correct. Those statements are made based on various underlying assumptions and are subject to numerous uncertainties and risks, including without limitation, changes in project design or schedules, contract cancellations, change orders and other modifications, and difficulties executing on the project. If one or more of these risks materialize, or if underlying assumptions prove incorrect, actual results may vary materially from those expected. For a more complete discussion of these and other risk factors, please see McDermott's annual report on Form 10-K for the year ended December 31, 2010 and subsequent quarterly report on Form 10-Q. . This news release reflects management’s view as of the date hereof. Except to the extent required by applicable law, McDermott undertakes no obligation to update or revise any forward-looking statement.

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