J. Ray McDermott, S. A. (“J. Ray”) announced today that its subsidiary J. Ray McDermott Far East Inc., has received a Letter of Award for engineering, procurement and construction of 6,500 tonnes of topside modules for the Peregrino FPSO (floating, production, storage and offloading) by A.P. Moller – Maersk A/S (Maersk Contractors). Projects of this nature are typically valued in excess of US$250 million.

“This project underscores J. Ray’s ability to draw from its global resources to offer a fast track and cost effective solution when our customers need one most,” said Bob Deason, President and Chief Executive Officer of J. Ray McDermott.

“Our engineering and procurement resources in Houston combined with our operations on Batam Island, Indonesia are able to leverage the global footprint of J. Ray to optimize project execution and delivery.”

Engineering and procurement activity have commenced while the fabrication scope is expected to begin in the third quarter 2008. Construction of the 6,500 tonnes of topside modules will commence in the third quarter 2008 at J. Ray’s Batam Island facility in Indonesia.  Up to 1,200 Indonesian craftsmen are expected to be employed on this project at J. Ray’s Batam fabrication facility. The Peregrino FPSO project is expected to be complete by the fourth quarter 2009. 

The FPSO will ultimately operate in the Peregrino field, located in the Campos Basin approximately 85 kilometers offshore Brazil. Under the development plan, the field is to be designed with the FPSO and two drilling platforms.

J. Ray McDermott, S.A. is a leading provider of solutions for the offshore field development industry worldwide and is a subsidiary of McDermott International, Inc. (“McDermott”). McDermott is an engineering and construction company, with specialty manufacturing and service capabilities, focused on energy infrastructure. McDermott’s customers are predominantly utilities and other power generators, major and national oil companies, and the United States Government. With its global operations, McDermott operates in over 20 countries with more than 20,000 employees, and can be found on the internet at www.mcdermott.com.

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 which 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 statements concerning the typical contract value, the project execution and timing of the Maersk Contractors/A.P. Moller - Maersk AS project. 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 by using various underlying assumptions and are subject to numerous uncertainties and risks.  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 risk factors, please see McDermott’s annual report on Form 10-K for the year ended December 31, 2006 and its quarterly reports on Form 10-Q.