J. Ray McDermott S.A. (“J. Ray”) is planning to set up its newest fabrication facility in Tub-Karaganskiy Bay in the Caspian Sea (Mangistau region, Republic of Kazakhstan).

Appropriate agreements were recently signed between the Kazakhstan branch of McDermott Caspian Contractors, Inc. (“McDermott“), J. Ray’s Caspian operating subsidiary, and TenizService LLP (“TS”), a subsidiary of JSC “NC KazMunaiGas”.

Under the agreements, McDermott will build and operate a fabrication facility on 49 acres of land reclaimed by, and leased from, TS. Tub-Karaganskiy Bay is located approximately 87 miles north of Aktau, the capital of the Mangistau region and the main sea gate of Kazakhstan to the Northern part of the Caspian Sea.

“We are very pleased to be expanding our physical presence in Kazakhstan and our Caspian fabrication capability to meet the emerging market demands,” said Dan Houser, Vice President and General Manager, Caspian Operations. “We expect sustained high demand for large-scale fabrication work in Kazakhstan and elsewhere in the North Caspian.  I expect that with our world-class employees and industry-leading practices, McDermott will add tremendous value to Kazakhstan’s offshore oil and gas industry.”

TS will reclaim 49 acres of land from the Caspian Sea to build the yard, including landfill and sheet piling, all to the requirements applicable in the Republic of Kazakhstan and to McDermott’s specifications. McDermott will provide engineering and construction of fabrication facilities and will install utilities, procure yard equipment, and recruit and train Kazakhstan personnel to manage and operate the Bautino fabrication yard.

“We are very pleased to be working with TenizService and we may even explore further opportunities for cooperation in projects and services,” said Dan Houser.

The Bautino yard will have 2,188 feet of quayside length with an average water depth of 21.3 feet, dedicated fabrication and erection areas, and other structures including offices, warehouse, training centre, canteen, and a dual bay fabrication shop. The yard layout has been designed so that the next phases may include construction of a heavy duty loadout skidway, additional fabrication bay, and a pipe mill with rolling equipment, with the flexibility to cater to future market needs.

McDermott Caspian Contractors, Inc. (McDermott) is the Caspian operating entity, and wholly owned subsidiary, of J. Ray McDermott, S.A.

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”) (NYSE:MDR).

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 25,000 employees. Its subsidiary, J. Ray McDermott, S.A. is a leading provider of solutions for the offshore field development worldwide.

In accordance with the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, McDermott cautions that statements in this press release, which are forward-looking and provide other than historical information, involve risks and uncertainties that may impact the Company's actual results of operations. The forward-looking statements in this press release include statements concerning the development, timing, capacity and throughput  of the fabrication yard and related business at the Tub-Karaganskiy Bay on land leased from TenizService in Kazakhstan. Although we believe that the expectations reflected in those forward-looking statements are reasonable, we 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, including, but not limited to, risks that awards and contracts in backlog may not result in the expected revenues and risks that there are adverse changes in those markets. 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 and quarterly filings with the Securities and Exchange Commission, including its report on Form 10-K for the year ended December 31, 2007.