ATTACHMENT A

CB&I WoRLD
Issue 1, 2004
Available at http://www.cbiepc.com/about/issues/CBI_World_2004_1b.pdf


ATTACHMENT B
Post-Closing Risk Allocation Agreement (Feb. 7, 2001)
Temporarily under seal in accordance with Commission Rule 4.10(g), 16 C.F.R. § 4.10(g).


The bulging and eventual cracking of coke drums in the vicinity
circumferential weld joints creates a maintenance and eliabil
problem that has plagued refineries for decades. So when CB&l decide
to address this challenge, we developed an innovative solution thi

didn't just reduce bulging and cracking in the circumferential weld"

seam, it eliminated the seam altogether, leading to the production of
vessels with a longer operating life and lower maintenance costs. The
solution:Vertical Plate Coke DrumsTM.

The Bulging and Cracking Phenomenon
Industrial petroleum coke isa solid coal-like substance used primarily as
a fuel for the production of anodes, electrodes, graphite or similar
carbon-based products. Petroleum coke is produced by delayed
coking, a batch process in which heavy residual feedstocks. are
superheated and introduced into a vertically oriented cylindrical “coke
drum,’ where the vapors are removed for further processing, leaving
behind a high-density hydrocarbon residue. This residue, referred to as
petroleum coke, is then water quenched to allow for its removal once
the vessel has been depressurized, as well as to coolit toa point where it
will not self-ignite when exposed to air. This severe operational thermal
cycling experienced in the coke drums during the delayed coking
process is what tends to be the primary cause of the bulging and
cracking that occurs over time. Depending on the operating
parameters, type of coke produced, feedstock and other variables, the
cycle time of a given unit can last anywhere from 14 to 36 hours. And
while it is recognized that a shorter, more severe cycle hastens the onset
of bulging and cracking, in order to meet the demand for coke
production (which has steadily increased due to the processing of
heavier crudes), few refinery owners have the option of increasing cycle
times. instead, they must resort to either shortening their coking cycles,
adding more vessels or doing both. Thermal and stress analyses have
shown that the bulging and cracking phenomenon is related to the
higher-strength weld metal in the circumferential girth seams, which
does not yield at the same rate as the base material. The resulting
stiffening effect causes a “constrained balloon shape”. Because of this
restraint, the base materials begin to weaken and ultimately fail due to
cracking. The bulging is most severe in the lower cylindrical portion of
thecoke drum, where the shellis thickest.

DevelopingaSolution

Over the years, the coking industry has developed or proposed
numerous solutions for alleviating the stiffening effect of the
circumferential weld seams and increasing vessel life, including: “blend
grinding” the weld profile, decreasing the weld metal strength to be
within a closer percentage of the base metal yield, specifying higher
alloy material, requiring more non-destructive examinations and a

throughout the vessel. While certain approaches have some techni
merit, the majority of them typically resulted in cost increase:
limited success. To develop a more reliable coke drum design,
focused on eliminating the circumferential weld seam alto,

cycling, except where those seams intersected the ci
‘ones. By incorporating this knowledge, along with
expertise and experience from other applications,
for successfully fabricating shell plates that could r

limitations, up to five circumferential weld,
resulting in a more reliable coke drum tha

few construction (shop built or
rofit applications, where the lower
used. We have patented our Vertical

cone and top head sectio,
Qgy in the United States, and patent coverage

Plate Coke Drum tec!

stricter acceptance criteria, and maintaining a uniform shell thickness,

Vertical Plate Coke Drum Applications
Since 2000, CB&l has completed four Vertical Plate Coke Drum retrofit
projects, all of which were completed at an equal or lower cost to the

lI-vessel replacement. The first successful installation took place at a
refinery in the western United States in 2000.

fscustomer than traditional methods and were much less expensive than

lient had originally planned on replacing two 20-foot-plus

\s of distorted and cracked shell on two of its coke drums, which

ve left circumferential seams in the section of the drum where

jing and cracking was most pronounced. However, after

4 CB&'s vertical plate concept, the client decided to modify its

idireplaced all but the upper nine feet of shell with two vertical
es reaching heights of 23.5 feet and 40 feet, respectively.

The vertical plates are lifted into place at a refinery in
“sthe western United States.

to forming and welding the plates and erecting the vessels

itly on a turnaround basis, CB&l also replaced a large nozzle in

ead and sections of the skirt support, and performed post-

Gat treating and hydrostatic testing all within a span of 28 days.

‘ical plate solution was so successful, the client subsequently
acted CB&d to replace the shells on an additional four coke drums,

jerall, CB&l has completed a total of 11 Vertical Plate Coke Drums.
hese projects have included the full circumferential can section
replacement of shells ranging from 35 to 73 feet, as well as new lower
knuckle and skirt assemblies. Currently, we are pursuing several other
coke drum projects, including some that require a full coke drum
replacement to add to the refinery's existing coke drum production.
Replacing an entire vessel involves rem: tick on top of the
structure with one lift and then remtovi

CB&l has devel
to meet those



CBI

Project
Execution

+ Develop innovative low cost
techniques

* Manage project variances
+ Real time entry of project data

+ Retrieve real time reports from
Global Project Mgmt system (GP)

+ Accurate cost information

* Estimate using best practices JDE Database

+ Evaluate new cost saving
techniques

* Repository of project
information

+ Allows real time

analysis of project

performance

Mgmt Project Project
Reviews Controls

Performance

* Review project variances Factor Analysis + Validate estimates in bid process
= Intervene as necessary to ensure + Identify positive and negative

optimum profitability . variances on current projects
* Identify best practices ° Analyze current project performance * Provide real-time feedback to
+ Validate estimates in bid process multiple key project factors: mgmt on project performance ;

. . a * Manage proprietary global project
* Engineering + Fabrication management system (GPS)

* Procurement = Construction

Real-time project management procedures provide

CB&l a competitive advantage on fixed price projects 4



Relevant Business. A purchaser of an LPG tank or LNG tank may also require other hydrocarbon
tanks, vessels and spheres or specialty structures. The Acquirer may be at a competitive
disadvantage to CB&I, in competing in the Relevant Products, if it is unable to provide the variety
of industrial tanks and specialty structures offered by CB&I.

Further, neither Respondents’ proposal that the Acquirer [

] nor Respondents’ proposal that the Acquirer [

] appear to describe an Acquirer that is likely to be approved by the Commission. Jd.

at 10. Moreover, Respondents’ proposal is objectionable because (1) it would give CB&I a
financial interest in the projects of its competitor; (2) it would allow CB&I to retain control over
the projects of its competitor by controlling the availability of the CB&I employees; (3) it creates
an inherent conflict of interest between the employees and the Acquirer, as employee loyalty will
run to CB&I (the employee’s ultimate employer); and (4) it creates an environment where
competitive secrets are more likely to be leaked and collusive behavior is more likely occur,
notwithstanding any “firewalls” as suggested by CB&I.

Without knowing what resources and existing business the proposed Acquirer brings to the
table, Respondents’ proposal [ ] would likely
reduce the viability and competitiveness of New PDM in the Relevant Products and would impair

the Commission’s ability to obtain effective relief.

14


Global Clean Fuels Market Forecast

Desulfurization Project Awards Expected in 2005-2010

14.0 5 13.2
12.0 4
10.0 +
2 8.0
Gg 807 6.8 6.9
io 6.0 +
An
4.0 5
2.0 +
0.0 T T : 1

N. America Europe Asia Other
Source: ML Payton Consultants

@ $35 billion in global desulfurization projects remain to be completed under

existing environmental standards
© The potential for new standards in the future may drive additional spending

14


CBI

13.0

$ Billions

12.0
11.0
10.0
9.0
8.0
7.0
6.0
5.0
4.0
3.0
2.0
1.0

n

1

Global LNG Construction Forecast

LNG Capital Expenditure Outlook

i
T T T T T T T T T ~

@ Export Terminals

IB Import Terminals

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Source: Douglas-Westwood LTD

$ Billions 2000-2004 | 2005-2009
Import Terminals 4.0 14.5
Export Terminals 7.8 31.1
Total 11.8 45.6

12


Short-term Supply Concerns and Rising Oil Prices
- Strong demand growth in China and India
— OPEC's production capacity is already near full capacity
Political turmoil in Venezuela, Nigeria and Middle East threaten supply
Russian government's policy toward Yukos is slowing investment in FSU

=> Oil futures hitting $50+ per barrel
@ Long-term Supply Concerns, “Hubbert’s Peak”

- Major Oil Fields around the world are aging

— New exploration is required to replace depleting
reserves

—- Newfields are more capital intensive and harder
to find

1=> Alternative fuels are becoming economic



CBI

Revenue ($ in millions)

$2000-§2 200

‘001 anne 003 004 NOSE 2001 2002 2003 2004

Earnings Per Share EBITDA (Percent of Revenue)

2, 8.6%
$0.89-$0.93 la 7.8%

6.7%

$0.69

$0.67 5.5%

’ 2001 2002 2003 2004 Q1 2005

2001 2002 2003 2004 2005E

22


_ Energy Demand Drives Long-Term ©

Infrastructure Spending Cycle

Global Energy Consumption Energy Investment ($ Billions) a

706
Pod 2001- 2011- 2021-
600 oe 2000 2010 2020 2030
2 500 ws
a ee Oil 87 916 1,045 1,136
© 400 | Gas 80 948 1,041 1,157
= 300 Coal 1 125 128 144
s§ 200 Electricity 235 2,562 3,396 3,883
fe]
100 Total 413 4,551 5,611 6,320
@ , Annual Avg 413 455 561 632
2001 2025
Source: Energy Information Administration Source: IEA and CSFB estimates

® Growing global energy consumption is driving infrastructure investment
@ CB&I has strong capabilities in several key areas

-— LNG

— Clean Fuels

— Heavy Crude Conversion
_ — Alternative Energies

® CB&I is well positioned to leverage its strengths to enter new markets as
opportunities develop 10


News & Contracts

Valero Energy Corp. awards major cl
contract to CB&l

approved funding for its McKee refinery to enter into al
procurement and construction contract with CB&l Matrix, a subsidia
Under the terms of the agreement, CB&d Matrix will design, build
35,000 barrel per day (BDP) gasoline desulfurization unit at Valero's 1
McKee refinery in Sunray, Texas. With its completion in fall 2005, thé:
reduce sulfur content of naphtha feedstock using technology licensed.
Catalytic Distillation Technologies, a partnership between ABB Lummus Gl
and Chemical Research & Licensing Co. based in Pasadena, Texas. That,
will enable Valero to better and more cost-effectively comply with
Environmental Protection Agency Tier Il gasoline specifications.

CB&l supports offshore LNG Terminal

development

Jul. 12, 2004 - Leveraging its decades of experience and leading technologies in
liquefied natural gas (LNG) storage and offshore structures, CB&l now offers a
variety of solutions for the design and construction of offshore LNG import
terminals. One such solution combines conventional cylindrical LNG storage
tanks with a concrete gravity based structure (GBS). Ideal for shallow water
environments such as the Gulf of Mexico, CB&l's GasPORTTM concept offers
significant advantages in terms of shorter schedule, lower cost and flexible
design using proven technology. CB&'s GasPORT incorporates a concrete GBS
as the primary component acting as the foundation and support structure for
the facility, The terminal is equipped with integrated facilities for mooring and
berthing of the LNG carrier; berthing of supply vessels; LNG unloading, storage
and_regasification; utilities; natural gas transport to shore; and crew
accommodations. LNG storage is provided ina series of conventional cylindrical
tanks thatare anchored to the GBS.

GasPORT is designed to withstand the adverse environmental conditions
typically found in offshore locations. Design loadings have been factored into
CB&I’s terminal concept to achieve maximum reliability and safe operation
CB&i's engineers have evaluated wind, wave states, scour and anchorage of the
GBS on the ‘ocean floor, as well as graving dock, towing and mooring
requirementsin their design considerations.

“Drawing upon more than 65 years of combined experience in the LNG and
offshore industries, we believe our GasPORT LNG terminal concept offers a cost-
effective and reliable solution to help meet the growing US. demand for natural
gas,’ said Gerald M. Glenn, CB&d's Chairman, President and CEO. "We're pleased to
offer this new development, based on proven technology and our unparalleled

companies seeking to tapthe burgeoning LNG import market”

experience, as well as a number of other offshore terminal concepts “se

é
al
construction (EPC) services for offshore LNG facilities. A pioneer and nol

Bal is in a unique position to offer full engineering, procurement

leader in the LNG industry, CB&I has designed and constructed more thafi
LNG terminals and peak shaving plants and more than 200 LNG storage’
around the world. Furthermore, with the broad offshore experier
capabilities ofits CB&i John Brown unit, CB&'s integrated approach to:ofishiore
LNG import terminals leverages extensive worldwide offshore spro}
background and technology. CB&l John Brown has been resp@hsiblé for

15% of the world's offshore semi-submersible/tension leg
numerous subsea flow lines, trunk lines and production,
addition to gravity based structure designs, CB& has the tes

CB&i, through its Process & Technology Group, is executing the projects on a
lump-sum basis, including engineering, procurement and modular fabrication.
Each facility will use the Company's proprietary HYFORMINGTM steam methane
box reformer technology, which provides superior process performance and
proven reliability within a robust mechanical design. In all of the plants the
process is designed to produce 99.9% purity hydrogen for use in clean fuels
production. The first facility is scheduled for completion in late 2005.

CB& wins follow-on award for further expansion
of U.S. LNG Terminal

June 14, 2004 - CB&I (NYSE: CBI) was awarded a lump-sum turnkey contract
valued in excess of US$55 million for a liquefied natural gas (LNG) terminal
expansion project in Lake Charles, Louisiana, USA. Owned and operated by
‘Trunkline LNG Company, a subsidiary of Southern Union Company (NYSE: SUG),
the expanded Lake Charles terminal is North America's largest operating LNG
terminal.
“ @BRI's work scope for the Phase Il expansion project includes the engineering,
#curement, construction and commissioning of new second stage pumps and
rizers to increase plant send out; the mechanical topsides of a second new
hip unloading dock; and related civil, mechanical and electrical works. The
‘project will increase the facility's send out capacity to 1.8 billion standard cubic
Fe day Scroyofnatural gas from 1.2 billion SCFD. The project is expected to
‘oinpleted by mid-2006, and the terminal will remain in operation during
BRIS Work,

In-2003; CB&I was awarded the EPC contract for the initial expansion of the
termihal. Upon completion, which is scheduled for late next year, the Phase |
expansion will add a 140,000 cubic meter LNG storage tank and increase plant
from 630 million SCFD to 1.2billion SCFO.

“We are‘pleased that Trunkline LNG has chosen to continue their relationship
with GB&i for the further expansion of the Lake Charles terminal," said Gerald M.
Glenn, CB&'s Chairman, President and CEO. “We believe our unique ability to
perform every aspect of an LNG import terminal project will enable us to bring
valuieto this job from start to finish”

&l receives award for LNG Facility in

‘Equatorial Guinea

\pril 6, 2004 - CB&I was awarded a lump-sum turnkey contract valued in excess
USS60 million to design and construct a liquefied natural gas (LNG) storage
ity for Marathon Oil Company on Bioko Island in Equatorial Guinea. The
ility will store LNG produced by a new liquefaction plant that Marathon and
GEPetrol, the National Oil Company of Equatorial Guinea; plan to construct on
the island, which is located about 20 miles (32 kilometers) off the coast of
‘Cameroon in west central Africa. The plant is designed to produce 3.4 million
metric tonnes of LNG per year, with a projected start-up in late 2007, Bechtel
Corporation is the prime contractor for the overall project.

CB&l's work scope for the project encompasses the engineering, procurement
and construction of LNG tankage with a total capacity of 272,000 cubic meters,
including civil and foundation work, tank insulation, in-tank pumps and piping
to grade. CB&i's scope also includes the design and construction of nine smaller
tanksfor miscellaneous storage.

The Company is currently on site on Bioko Island constructing three low
temperature tanks for liquefied petroleum gas (LPG) storage as part of
Marathon's Phase 2B LPG expansion project. In addition, as partof the expansion
project CB&I Howe-Baker designed and fabricated a modular cryogenic gas
processing plant that was delivered to the island earlier this year and is currently
being installed. With a capacity of 870 million standard cubic feet per day
(MMSCFO), itis the largest plant of its type ever built by the Company.

"We are pleased to continue our association with Marathon as they develop a
new LNG source to help meet the growing worldwide demand for natural gas”
said Gerald M. Glenn, CB&i's Chairman, President and CEO. "Our current
mobilization on site should allow us to transition our forces seamlessly to this
importantproject"


ATTACHMENT C

CB&I Investor Presentation
Credit Suisse First Boston, Engineering & Environmental Services Conference
June 2005
Available at http://www.cbi.com/ir/presentations/documents/CSFBConference-June2005.pdf


Acquisition.’ As currently drafted, the definition accounts for the market realities that non-U.S.
assets play an important role in U.S. tank projects; that CB&I inextricably intermingled PDM’s
assets with its own; and that growth, development and innovation have occurred in the five years
since the Acquisition to create additional assets which may be necessary to create a viable
competitor. The definition of “Relevant Business,” therefore, is sufficiently broad to include such
additional assets as available for potential inclusion in the divestiture package.

1. The Assertions in Respondents’ Further Briefing Do Not Justify Narrowing
the Scope of Assets included in the “Relevant Business.”

In their Further Briefing, Respondents portray CB&I’s “Relevant Business” as being much
broader than the business engaged in by the PDM EC and Water Divisions at the time of
Acquisition.” However, the distinctions drawn by Respondents are not supported by the facts and
often appear to be the result of different nomenclature used by PDM versus that used by CB&I to
identify equivalent product and service offerings.

The record shows that the nature and scope of PDM EC’s capabilities and operations as it
existed prior to the Acquisition were substantially broader than just the Relevant Products and
water tanks and included product and service offerings roughly equivalent in scope to those
currently offered by CB&I. Both CB&I and PDM’s business documents show that, at the time of

the Acquisition, the Relevant Products accounted for only a portion of the diverse array of

8 “The relief which can be afforded [from the illegal Acquisition] is not limited to
the restoration of the status quo ante, [but rather] must be directed to that which is ‘necessary and
appropriate in the public interest to eliminate the effects of the acquisition offensive to the
statute.” Op. at 94, quoting Ford Motor Co. v. United States, 405 U.S. 562, 573 n.8 (1972).

° Respondents assert that “[iJn contrast to PDM’s EC Division, which primarily
was a U.S. tank builder, CB&I’s business” is broader in scope and includes “not only
construction of the Relevant Products and water tanks, but also hydrocarbon processing plants,
offshore structures, pipelines, hydrocarbon storage tanks, and other steel structures and their
associated systems.” Further Briefing at 4.


wind farm: layout. The “coon of offshore wind turt nes cera
snowledge ‘about wave conditions, particularly: the- extrer

‘heights. Wave heights generally increase with wind

there is atime. lag, $0 that ‘extreme winds and: waves

‘Waves. vary with geographical location: The I
farms may need to take into account the possibility
the'sea, particularly in more northern latitud
design, the design of the structure (to'prot
collisions with ice floes) and operation:and m
‘egions where the sea freezes over a

“worldwide expenditure on offs
-annum by 2007. The Round
the

jore wind energy.

din

dully 2003 and

ike Smith



News

Welcome to CB&l World

Technology & Innovations
Special Features

World Focus



containment liquefied natural gas (LNG) storage tanks and two
Pressure vessel spheres at a natural gas liquefaction plant in the far
eastern portion of the Russian Federation. The two LNG tanks, which
are being constructed as part of the Sakhalin II project, will be the first
LNG tanks designed and constructedin Russia.

The Sakhalin Il integrated oil and gas development represents the
largest single direct foreign investment project in Russia to date, with
total investment estimated to exceed US$10 billion. The huge gas
resource base of this development will guarantee supplies of more than
nine million tonnes a year for at least 25 years to Sakhalin's key markets
in the growing economies of Asia. It is the first oil and gas project in
Russia to be developed under a production sharing agreement (PSA),
the first offshore development in Russia, and the first LNG project in
Russia. Our work scope includes the engineering, procurement and
construction of two 100,000m’ full containment LNG storage tanks
including all insulation, piping, mechanical equipment, and electrical
systems, two 1,630m* Hortonsphere® pressure vessels made from 9%
nickel plate materials, and a concrete batching plant to supply concrete
for the foundations and containment. We are self-performing alll civil
works forthe project.

We were chosen because of our long tradition of working with Russia
and the countries of the former Soviet Union. Our capabilities in Russia
include: .

© Ability to work with Russian design institutes, manufacturing
tities, federal authorities, and local contracting organizations

+ Legal qualificatidn to perform engineering, procGremeht and
7 os ty

e ilities available Within Russia
jin ae climate conditigns
p'sum contrgctor
are ipa unique position among globa
sntent obligations;i ri
force eh ocood

d it is@’requirement specified in

In June 2003, CB& was awarded lump-sum EPC contracts for two full

We are also adept at applying best international practice to projects in
Russia while maintaining compliance with Russian standards and
regulatory bodies. Our previous experience in the design and
construction of the crude oil tankage at the Novorossiysk marine
terminal was indicative of our ability to successfully execute projects in
Russia. Because storage tanks of the size needed for the Novorossiysk
project had never before been built in the former Soviet Union, local
codes did not address their design or construction. Our scope included
obtaining federal and local approval of the technical specifications
developed for the tanks. Similarly, the Sakhalin Il LNG tanks were not
covered by existing codes; we developed the req documents and
worked with the Russian authorities to obtain the necessary approvals.

We are also working with Russian design institutes to ensure all local
compliance issues are met and to harmonize international, contractor,
and Sakhalin Energy standards with the Russian system.

In addition to being the first major western development in Russia, the
Sakhalin Il project presents a number of challenges, including:

* Contending with and designing for sub-arctic conditions (drift ice,
earthquakes, temperatures that fall below -20°C, snow accumulations
of 2meters)

* Providing a high degree of technical-expertise and applying innovative
technologies (completion.of high-productivity gas wells, erection of
earthquake-proof. and ice-proof platforms, compliance with all
environmental protection regulationsin a sensitive area) \

'» Dealing the island's lack 9f infrastructure (roads, harbors, codes,
distant supply points) " .

‘Our off-site andionsite fabrication abilities ns

innovative tec} none sea i ie jenabie

worldwide expetienge, positidnialsGhiquely well

‘challenges. For the L

design engineer!

contend with

tanks anda is r

able to secure prote

containment wallaffthe
~-end-of December, w

iaavative construction solution to
e i ing a freestanding liner for the
before completing the outer wall, we were
rom the weather and _take-the-coficrete
i at pathy By ‘Completing this work before the
G8'Be ble to keep the constuction project:
thing to do in sub-artic cli 3
ie

come. The'sla
ore renee

employees from 0
Di UAEsanc

wo Mouerot



Chol eHow —

Gerald M. Glenn

Chairman,
President and Chief Executive Officer

Welcome to CB&l World

Many of you are familiar with CB&I, but you may not be aware of the global scope of
our business. For others, this may be your first introduction to our company. We
welcome all of you and hope this magazine gives you a better understanding of the
capabilities, technologies and services we can deliver anywhere in the world.

CB&I was founded in 1889 and is a global specialty engineering, procurement and
construction (EPC) company. With a worldwide network of some 40 offices and
established labor and supplier relationships, our 10,000 employees come together
from many nations to provide engineered facilities and services that help our
customers produce, process, store and distribute the world's natural resources in a
safe, efficient, economical and environmentally responsible manner,

CB&I serves customers in several primary end markets, including oil and gas;
petrochemical and chemical; power; water and wastewater; and metals and
mining. Our projects include hydrocarbon processing plants, LNG terminals and
peak shaving plants, bulk liquid terminals, water storage and treatment facilities,
and other steel structures and their associated systems. We also provide a broad
range of maintenance and repair services, including complete turnarounds for
petroleum refining and petrochemical plants.

Over the years, we have achieved by practice and design a record of exemplary
safety performance, which translates directly to lower cost, timely completion of
projects, and reduced risk to our employees, subcontractors and customers.

CB&I operates as a fully-integrated EPC service provider, offering a complete
package of conceptual design, engineering, procurement, fabrication, field
erection, mechanical installation and commissioning. These capabilities combined
with our safety performance, experience in risk management and disciplined
project controls process - allow us to execute global projects on alump-sum, turnkey
basis. Lump-sum contracting provides advantages in terms of cost and schedule
thatourcustomers depend on to meet their business objectives.

In each issue of CB&I World, we plan to highlight some of the characteristics and
achievements that we believe make CB&l unique in the engineering and
construction industry.

We hope you enjoy our inaugural issue.


Business Profile

Water Storage and Water Treatment

Since CB&I built our first elevated water storage tank in 1894 in Fort
Dodge, lowa, our water storage division has provided a steady flow of
business that has resulted in the design and construction of more than
25,000 water tanks during the past 100 years. Currently, we construct
approximately 175 tanks each year. As new technologies and water
markets are developed and the demand for clean water increases, we
are planning to meet current and future needs in the evolving water
storage and water treatment markets.

Water Storage

Most water tank companies are only able to offer limited types of tanks
in certain regions, whereas CB&_because of our worldwide execution
presence can deliver any style of tank regardless of location. Thisis one
of the main differentiators between us and our competitors. Although
we have an expansive offering of solutions, all our tanks are generally
classified in one of two categories: elevated and ground storage. Atank
is considered elevated if it stores water at a height above the ground
sometimes 100 feet or more while the ground storage tank, also
referred to as a flat bottom tank, stores water at ground level. Sohowdo
municipal and private owners decide between building an elevated
tank versusa flat bottom one?

Owners generally consider several factors, including initial cost,
operating costs and aesthetics. Elevated tanks usually result in lower
Operating costs because once water has been pumped into the tank,
gravity takes over and does the remaining work. This system permits
water availability even during power outages, which is especially
important for tanks designated for fire protection. CB&I has sold more
Waterspheroid? elevated tanks in recent years followed closely by the
HydropillarTM than other types of water tanks, Reliable and secure, the
Waterspheroid is often found in areas of high visibility. The
Waterspheroid is slender and sleek and takes up less surface area,
which makes it aesthetically more appealing to some customers. For
larger tanks with capacities exceeding one million gallons, our
Hydropillar and Composite Elevated Tank tend be more economical
andare often the preferred tank choices.

Our ability to take the available space inside the support tower and
convert it into usable space has made the Hydropillar popular with
many customers. CB&l has installed community centers, fire stations,
meeting rooms, storage areas and offices inside these towers: This
ability to design, build and market these tanks with multiple uses and
purposes also differentiates us from our competitors, We have recently
developed a newinnovative product, called the Precast Waterspheroid,
whichis similar to the Composite Elevated Tank.

Both are supported by a concrete shaft; however, the Precast
Waterspheroid uses concrete elements that are precast at a supplier's
facility and shipped to the job site to be erected by the crew. Over the
years, CB&I has developed several innovative processes for water
storage that have helped the company maintain a leadership position
in the water industry.

One such innovation is the patented
FreshMixTM mixing system, which eliminates
tions of water by using a

te and inlet nozzle to keep
cir intg(see Figure 1).
itkno| ing . dditional energy

, this system is
re frequently

id ldyy“‘mainten, ce
béiag selected phore

Fy tank ow!

‘While expanding ontthese i ns hell ct ontinue to
t the neeqs of i Is, WeKNO' it we pxlist dg so while at

the sai fime| providing a low-cost, ice thet prakes these projects

WaterTreatment

CB& continues to expand
our water business base by
pursuing new opportunities
within the water market. The
company has a number of
innovative water treatment
systems available to meet
the needs of the water
treatment market, including
the. ClariConeTM and the theciariconeTM
FiltraConeTM.

‘design

The ClariCone's design makes it more economical to operate and
maintain than many other water treatment systems. Mixing, tapered
flocculation and sedimentation all take place within a completely
hydraulically driven vessel. They are constructed entirely without
mixers, scrapers, recycle pumps or other continuously moving parts,
eliminating the need for oil changes and gear overhauls.

The FiltraConeTM system brings together the ClariConeTM clarifier with
self-backwashing peripheral filters in a fully enclosed system, providing
exceptional treated water quality with minimal maintenance, power
use and cost.

Safety

Safety has always been an integral and critically important part of our
culture. Because much of the construction work for water projects is
performed at heights, safety is a top priority for these projects. Our goal
isto work safely with no injuries.

Looktothe Future

CB& has won a number of awards for our innovative water solutions.
Ultimately, however, it is the people who work on the water projects
that make us successful. Staffed with a skilled and dedicated workforce,
we have been in the water business for more than 100 years; a tradition
the company hopes will continue for years to come.

3,000,000 gallon standpipe,
ity of ole, nots

1,500,000 gallon Waterspherold®,
Cy of South Bend, Indiana

1,500,000 gallon Composite,
City of Canton, Missisippl

3,000,000 gallon HydropitiarTM,
Jefferson County Commission,



D. CONCLUSION.

For the foregoing reasons, Complaint counsel request that the Commission reaffirm its

Final Order.

DATED: June 20, 2005.

18

Respectfully submitted,

WA K Ailo—

Rhett R. Krulla

Elizabeth A. Piotrowski

David von Nirschl

John A. Singer

Steven L. Wilensky

Counsel Supporting the Complaint
Bureau of Competition

Federal Trade Commission
Washington, D.C. 20580



FTC Order

On January 6, 2005 the FTC Commission issued their Opinion and Order
regarding an administrative complaint filed by the FTC in October 2001

This FTC complaint challenged CB&l’s February 2001 acquisition of
certain assets of Pitt-Des Moines’ Engineering Construction Division.

The Opinion requires CB&l to:
— Divide its industrial division into two separate operating divisions

— Divest one of these divisions within 180 days of the Order becoming final
to a purchaser approved by the FTC |

CB&l believes the ruling is inconsistent with the law and facts presented
at trial

CB&l filed a notice of appeal with the US Court of Appeals for the Fifth
Circuit in March 2005

CB&I would not expect a decision until 2006 or beyond

CB&I is not required to divest any assets until we have exhausted all

appeal processes available to us including the United States Supreme
Court ,

20


Business” does not contain a geographic limitation to U.S.-only assets.” To include such a
limitation at this point in the proceeding would severely impair the Commission’s ability
ultimately to ensure viable and effective divestiture relief for the illegal Acquisition.

3. The Scope of the “Relevant Business” Must Account for the Fact that
following the Acquisition, CB&I Intermingled PDM EC’s Assets and Business
with CB&I’s Assets and Business.

Respondents submit that the plant and equipment held by PDM EC five years ago “reflect

the precise assets necessary to compete against CB&I in the tank business.” Further Briefing at 4.
This throwback to relief even more limited than that ordered by the ALJ ignores PDM’s broad
array of intangible assets that have been intermingled by CB&I with its own intangible assets and
further intermingled by the merged firm with intangible assets developed or acquired since the
Acquisition. It further ignores innovation, product development and growth by the merged firm
since the Acquisition, which will likely continue until the divestiture is completed.

In the months prior to the Acquisition CB&I convened integration teams consisting of
personnel of CB&I, Howe-Baker,* PDM EC and PDM Water to integrate the operations of the
companies with respect to sales, engineering, project management, fabrication, construction and
procurement. CX 1713 at CBI/PDM-H 4015059. In its Form 10-K for 2001 CB&I acknowledged
that it is “leveraging Howe-Baker’s advanced hydrocarbon processing engineéring and technical

capabilities across [CB&I’s] worldwide marketing and execution platform.” CX 1033 at 3.

2 Because Customer Contracts may contain key employee clauses that require

customer approval to replace key employees on a project (IDF 580), it is possible and foreseeable
that the allocation of employees between the two entities Respondents are required to create
pursuant to Final Order {| III may, among other things, necessitate the transfer of Customer
Contracts and assets relating to projects outside the United States to the Acquirer.

3 Howe-Baker, acquired by CB&I on December 28, 2000, provides hydrocarbon
processing plants for the refining, petrochemical and natural gas industries. CX 1033 at 3.

10


CB&I Helps Complete C
Power Plant in Record Time

2004 has been a great year for work in Honduras for CB&d. Currently, the
Company is finishing up two propane spheres for ChevronTexaco in
Puerto Cortes, Honduras, as well as building two cone roof tanks (CRTs)
for Hondupetrol in Puerto Cortes that will store the heavy fuel oil
needed to operate power plants. In addition, we are engaged ina large
expansion project at the tank farm previously built for the Lufussa
power plant in Western Honduras and we have begun construction on
another CRT in Tela, Honduras. Our most recent project is a CRT farm
built to supportthe fuel and lubricant requirements of a 210-megawatt
heavy fuel oil fired electricity-generating plant in Choloma, Honduras.
What is particularly noteworthy about this project is that CB&l
completed the tank farm less than five months after contractaward.

MAN B&W Diesel AG needed to supply five diesel engines to power the
plant's electrical generators by the end of March 2004, so they
contacted us to supply 14 CRTs to the plant within this timeframe. Due
to the project's challenging schedule, we would have to rely on our
experience and connections with key Central American countries and
subcontractors to complete the project on time. CB&I built similar tank
farms for Wartsila in Guatemala, Azua, in the Dominican Republic; for
the previously mentioned Lufussa power plant in Western Honduras;
and for MAN B&W Diesel AG seven years ago in El Salvador. We were
determined to achieve the 11-week field schedule, which was originally
estimated at 18 weeks.

CB&d Engineering, led by John Hormann's team, began detailing the
main steel for the bottom, shell and roof of the first seven tanks in late
November 2003. The demanding schedule called for the rolled shell
plates to be delivered to the Port of Houston by the end of December
2003. The Houston fabrication shop exceeded all expectations and
providing 94 shell plates to the port by the cutoff date, By December,
MAN B&W Diesel AG had more than 400 people working in three shifts
seven days a week on the civil work and foundations for the power plant
andtankfarm.

holoma, Honduras,

To support the tank erection schedule, CB& had to have the liners and
cathodic protection installed in January 2004, while the owner was
clearing materials and equipment through customs. Superintendent
Owen Penniston organized the field crew, and supervision was brought
in from Trinidad, Jamaica, Guatemala, El Salvador, Panama, Venezuela,
the Dominican Republic and the United States.

CB&l's resourcefulness and “can-do attitude” overcame all project
challenges, and on March 31, 2004, the electric power plant was started
up onschedule.

As promised, CB&l got the project done safely, on time and within
budget. In the process, the Company also helped to set a world record for
starting a new power plant of this size in the shortest amount of time. The
inauguration of the power station was attended by Honduras’ President
Ricardo Maduro, who pointed out that commissioning of the power plant
would finally stop the need for the import of expensive electricity and,
therefore, make a considerable contribution to advancing Honduras‘
progress.

“The resulting savings will enable us to finance school lunches for some
800,000 children within the next five years, to employ 2000 policemen,
500 physicians, 1000 nurses and 1000 teachers" he stated.

We are proud to have had an opportunity to perform our portion of the
project. Everyone in Sales, Engineering, Manufacturing, Procurement,
Traffic and the field crew should be commended for the long hours and
around-the-clock effort they put forth.

Dave Mcintosh



Shanghai Ethylene Cracker Complex (SECCO)

Strong economic growth in: China has.

that give
worldwide

tp =e the-best price along with an

‘of
flevel Wateyanda YELLOW SEA

ect i tek for achieving 1,000,000, warkshours)
eat iceanape 0; Bacirs hos fable’ ident.

te ‘will

be th vargert of

ject. com|

AN pr seb
tes, 600), KTPA objet
sii common tif i



the type of tank business that was conducted by PDM EC. Further Briefing at 6-7. However, at
the time of the Acquisition, process systems and process vessels were identified by Respondents as
being included in PDM EC’s business, both in CB&I’s 2001 Form 10-K and in PDM EC’s
offering memorandum."

In other words, PDM EC’s business and pre-Acquisition capabilities encompassed
products that Respondents’ Further Briefing claim are beyond the scope of PDM EC’s business.
Accordingly, Respondents’ Further Briefing provides no reliable basis on which to carve any
specific assets out of the definition of “Relevant Business.”!*

2. Divestiture Should Restore the Competition Represented by PDM, a Global

Competitor, by Recreating Two Viable Businesses Capable of Competing

Effectively in the Relevant Products in the United States.

Prior to its acquisition by CB&I, PDM EC conducted business operations on a global scale

8 As noted supra n.10, in reporting on the Acquisition in its 2001 Form 10-K,

CB&I identified process systems as among the products engineered, fabricated and constructed
by PDM EC. CX 1033 at 44 (internal page 37). Moreover, the offering memorandum expressly
identifies process vessels, which are used in process systems and plants, as among the products
offered by PDM EC. CX 385 at 12 (internal Page 9). Further, shortly before the Acquisition,
PDM EC identified future business opportunities and projected that the “Clean Fuels Act will
provide demand for towers, pressure vessels, some storage, vessel retrofit.” CX 1713 at
CBI/PDM-H 4015076 (PDM Engineered Construction Financial Forecast 2001-2004) (emphasis
added).

4“ Moreover, as discussed at pages 11-12, infra, PDM EC’s business, as now

commingled with the merged firm, offers various offshore LNG tank and terminal designs.

6 Respondents also imply, without support, that reductions in the purchase price for

PDM occurred as the result of a reduction in the scope of the assets and business acquired by
CB&I from PDM. Further Briefing at 6 n.6. However, the ALJ found that the reductions in
purchase price were due to financial losses in PDM EC and PDM Venezuela, both acquired by
CB&I and both covered by the PDM EC Offering Memorandum. Initial Decision by
Administrative Law Judge D. Michael Chappell (June 18, 2003), Findings of Fact, J 11 (“IDF”)
available at www.ftc.gov/os/2003/06/cbiid.pdf. In addition, the purchase price may have been
reduced because CB&I agreed to [

] See Post-Closing Risk Allocation Agreement (Feb. 7, 2001) (Attachment B).
7


products that were offered by PDM EC."° For example, “hydrocarbon storage tanks,”'' which
Respondents assert were not included in PDM EC’s business, in fact represented the mainstay of
PDM EC’s business, accounting for 56.7 percent of PDM EC’s revenues over the three-year period
1997-1999. CX 385 at 15 (internal Page 12). Similarly, “other steel structures and associated

””!2 which Respondents also claim were not included in PDM EC’s business, accounted for

systems,
30.3 percent of PDM EC’s revenues in 1997 and 15.1 percent of PDM EC’s revenues over the
period 1997-1999. Id.

Additionally, the inclusion of “industrial process systems” in the definition of “Relevant
Business” is consistent with the scope of PDM EC’s business. Respondents argue that because the

term “industrial process systems” is not expressly stated in the offering memorandum, its inclusion

in the definition “Relevant Business” would expand the scope of potential divestiture far beyond

10 By PDM’s own account, PDM EC was, at the time of the Acquisition, “a leading

global engineering and construction company specializing in the design and field erection of bulk
liquid terminals, storage tanks, process vessels, low temperature and cryogenic storage facilities
and other specialty plate structures and their related systems.” CX 385 at 4 (internal Page 1)
(emphasis added). CB&I agreed with this description, which goes well beyond the Relevant
Products and water tanks for the domestic market. In its Form 10-K for 2001, CB&I stated that
PDM EC “engineers, fabricates and constructs storage tanks and systems, process systems, and
unique plate structures for the petroleum, petrochemical, cryogenic, liquid natural gas, defense
and aerospace industries.” CX 1033 at 44 (internal page 37) (emphasis added).

" “Hydrocarbon tanks” are a type of industrial tank that PDM EC’s offering
memorandum variously refers to as bulk liquid terminals, storage tanks or flat bottom tanks.

e “Other steel structures and associated systems” include thermal vacuum
chambers, specialty plate structures and other products. CB&I identifies thermal vacuum
chambers as one of a variety of specialized, large metal structures engineered, fabricated and
constructed by CB&I, including wind turbine generators, research wind tunnels, aircraft engine
test facilities, aluminum laser target chambers and nuclear reactor vessels. CB&I WORLD, Issue
1, at 15 (“Special Features”) (2004) (Attachment A); see CX 1629 at 5 (thermal vacuum chamber
shown as illustrative of CB&I Specialty & Other Structures; CB&I Market Position -
“Acknowledged technical expertise worldwide in all types of steel plate structures”). PDM EC’s
offering memorandum also identified wind tunnels, fusion facilities and autoclaves as examples
of specialty plate structures that PDM EC designed, fabricated and constructed. CX 385 at 13
(internal Page 10).


CERTIFICATE OF SERVICE

[hereby certify that I today caused:

One original and twelve copies of Complaint Counsel’s Response to Respondents’ Further
Briefing on Specific Remedy Issues to be served, by hand delivery, and one copy to be
served, by electronic mail, upon:

Office of the Secretary

Federal Trade Commission
600 Pennsylvania Avenue, NW
Washington, DC 20580

And one copy to be served, by first-class mail and by electronic facsimile, upon each of the
following:

Clifford H. Aronson

Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square

New York, NY 10036-6522

(212) 735-2644

Charles W. Schwartz

Skadden, Arps, Slate, Meagher & Flom LLP
1600 Smith, Suite 4400

Houston, TX 77002-7348

(713) 655-5160

Counsel for Respondents Chicago Bridge & Iron Company N.V. and Chicago
Bridge & Iron

Jennifer L. Gray

Robert M. Unger

Brown Raysman Millstein Felder & Steiner LLP
900 Third Avenue

New York, NY 10022

(212) 895-2130

Counsel for Respondent Pitt-Des Moines, Inc.

MA cll

Rhett R. Krulla
Counsel Supporting the Complaint

Dated: June 20, 2005


are applied to projects in the United States, personnel are shifted between United States and
foreign projects as local demand conditions warrant, and CB&I relies on its global procurement
network in bidding for and completing United States projects. For example, Respondents’ claims
that no non-U.S. CB&I assets are utilized in U.S. tank projects and that CB&I’s assets and
operations outside the United States “are wholly unrelated to the U.S. tank business” (Further
Briefing at 8) are contradicted by CB&I’s own public statement that in designing, engineering and
constructing the recent expansion of the Lake Charles, Louisiana LNG import terminal, CB&I
“called on resources from around the world to execute the complex project. Engineering expertise
was combined with procurement capabilities on three continents and an experienced project team
with a history of proven performance in existing facilities in Louisiana.””!

A key element that enabled PDM EC’s global reach was its human capital in the form of
expert employees capable of designing, engineering, erecting and managing projects around the
world. The Commission has noted that the evidence shows that employees that build the Relevant
Products also build other types of tanks. May 10" Order at 24 n.111. For the same reason, it is
equally. likely that many employees may possess the same skills necessary to design, manage and
complete foreign as well as domestic projects, including in tandem with foreign partners. Because
we do not yet know what potential Acquirers will need in terms of human capital and other assets

to assure the competitiveness and viability of the divestiture relief, the definition of “Relevant

21 Attachment A at 12 (“The expanded Lake Charles terminal is North America’s
largest operating LNG terminal”). In this 2004 publication, CB&I highlighted the characteristics
and achievements that, according to CB&I’s CEO, make CB&I unique in the engineering and
construction industry. Jd. at 3. In its investor presentations CB&I notes that it is “Executing
Projects Around the World” and that “CB&I operates a global network of sixty facilities and has
the capability to rapidly mobilize people, materials and equipment virtually anywhere in the
world.” CB&I Investor Presentation, Credit Suisse First Boston, Engineering & Environmental
Services Conference, at 5 (June 2005) (Attachment C).

9


c

fi P
PRE in‘over a decade. Operated by EnCana (U.K.) Limited and
employing contractors in multi locations, the development is
gathering pace and Buzzard is expected to come on-stream late in
2006.

The Buzzard field is a major offshore development located in the UK
Outer Moray Firth, central North Sea, some 100 kilometers northeast of
Aberdeen and 55 kilometers from the nearest landfall at Peterhead.
Major contract awards were made by EnCana (U.K.) Limited during 200:

with CB&l John Brown winning the contract for Concept Definition and
Project Specification (CDPS) for the Buzzard installation in August 2002.

Buzzard is one of the largest discoveries made in the UK North Sea in
over 10 years. It's a product of innovative thinking, where EnCana (U.K.)
Limited applied creative geological techniques to a basin once
considered by some to be too mature for world class discoveries.

CBRL John,Brown completed the CDPS phase of work in June 2003. The
the detailed design.and procurement: of:
terials for the three platform topsides facilities:
is‘being undertaken at our offices in.Paddi
with ‘a team of over 600 people.

The platform topside facilities are being fabricated in a number of
locations:

« The Production deckis being fabricated by Dragados in Cadiz, Spain

* The Wellhead deckis being fabricated by Burntisland Fabricators Ltd
in Scotland, United Kingdom

« The Utilities deck is being fabricated by Heerema in Hartlepool,
United Kingdom

+ The Buzzard jackets are being fabricated by AkerVerdal in Norway

The Buzzard field development is on course with the fabrication and
construction of all topside facilities under way. Hundreds of people are
now working on the topsides design, steel jacket fabrication, pipeline
engineering and facilities installation. A huge and exciting challenge lies
ahead. The field is anticipated to begin producing by late 2006. At peak
rates Buzzard could account for 10% of the UK's total oil production.

More «informa:
wwwencana:com:

3-DCAD Model Strowing the Buzeard Facilites

non.ithe Buzzard’ development ‘is ‘available-on..” :


"TRADE COMA

JOCUNEN’ ‘gy
Leta
S/T.

SECRETE

UNITED STATES OF AMERICA
BEFORE FEDERAL TRADE COMMISSION

In the Matter of

CHICAGO BRIDGE & IRON COMPANY, N.V., PUBLIC VERSION

a foreign corporation,

CHICAGO BRIDGE & IRON COMPANY, Docket No. 9300

a corporation, and

PITT-DES MOINES, INC.,
a corporation.

To: Commission

COMPLAINT COUNSEL’S RESPONSE TO CB&I RESPONDENTS’
FURTHER BRIEFING ON SPECIFIC REMEDY ISSUES

The Commission has concluded that “Respondents have created ~ at least to an extent —
any problems associated with unwinding the transaction (and restoring competition), [so] equity
necessitates that they help solve them.”' Towards that end, the Commission directed Respondents
Chicago Bridge & Iron Company N.V. and Chicago Bridge & Iron Company (collectively,
“Respondents” or “CB&I’”) to “identify those assets in the ‘Relevant Business’ definition that are
unnecessary to build the relevant products and the water tank products,” and to “explain why the
inclusion of such assets is unnecessary, especially in light of the facts that: (1) the assets identified
in the ‘Relevant Business’ definition match those identified in PDM’s offering memorandum to

CB&I; and (2) the assets defined as CB&I’s ‘Relevant Business’ are integrated with the assets

' Opinion (“Op.”) at 94, quoting Ford Motor Co. v. United States, 405 U.S. 562,
573 n.8 (1972).


Production Processing Storage Distribution
eOil & Gas e@Oil & Gas e@Oil & Gas ei & Gas
—Wellhead design —Catalytic reformers —LNGILPG storage ~LNGILPG terminals
=Platform topsides —Hydrodesulfurization = Crude and refined —Crude and refined
~ Offshore substructures -Turnarounds product terminals product terminals
ePetrochemical/Chemical —Desalting/dehydrating ~ Pressure vessels —Pipelines
Hydrogen plants @Petrochemical/Chemical @Petrochemical/Chemical —Process piping
—Synthesis gas plants -Ammonia plants ~Flat bottom tanks —Compressor stations
Power —Process piping —Pressure vessels @Petrochemical/Chemical
—Heat recovery steam @Water & Wastewater Water & Wastewater —Import/Export terminals
generators ~ClariCone clarifiers ~ Elevated tanks —Pipelines
—Gas turbines —Egg-shaped digesters ePower —Process piping
@Metals & Mining — Thermal energy storage —Compressor stations
@Metals & Mining

Greater than 80%

of CB&l’s business is energy based


depth.” CX 1629 at 17. In sum, Respondents have inextricably commingled CB&I’s and PDM’s
intellectual property and other intangible assets into the merged firm.

Respondents’ assertion that “contrary to the implication in the Briefing Order, CB&I’s
other businesses were not and are not an integrated part of its U.S. tank business” (Further Briefing
at 4), is contradicted by CB&I’s public announcement that its offshore LNG terminals draw on
CB&I’s combined experience in LNG tanks and in offshore structures. CB&I July 12, 2004 Press
Release: “CB&I Supports.Offshore LNG Terminal Development” (Attachment D) at 1.. CB&I
acknowledges that

CB&I is in a unique position to offer full engineering, procurement and

construction (EPC) services for offshore LNG facilities. A pioneer and technology

leader in the LNG industry, CB&I has designed and constructed more than 40 LNG

terminals and peak shaving plants and more than 200 LNG storage tanks around the

world. Furthermore, with the broad offshore experience and capabilities of its

CB&I John Brown unit, CB&I’s integrated approach to offshore LNG import

terminals leverages extensive worldwide offshore project background and

technology.

Id. CB&I reaffirmed this announcement in Attachment A at 4 (“CB&I Supports Offshore LNG
Terminal Development”). CB&I recently announced development of a steel plate structure —
vertical plate coke drums. Attachment A at 17 (“Technology & Innovations; Coke Drums
Designed for Longer Life”). Process vessels, hydrocarbon processing plants, and clean fuels
projects, discussed at 5-7, nn.10, 13, supra, provide other examples of how CB&I has combined
the technology of PDM EC, Howe-Baker and CB&I.

It is not feasible to purge CB&I of the intellectual property and goodwill it acquired
through the Acquisition, because PDM’s knowhow, trade secrets and goodwill have been
disseminated throughout CB&I and reside in employees who will continue to work for CB&I

following the divestiture. For this reason, restoring the competition that was eliminated by the

Acquisition also requires that the divestiture include new product development and growth of the

12


Following the Acquisition CB&I similarly commingled PDM EC’s intangible assets across
CB&I’s businesses. CB&I explained in its 2001 10-K Report:
[W]e are creating synergistic growth by integrating the PDM
Divisions’ storage tank technology, execution capabilities and customer
relationships with our existing businesses to expand our product offerings. We

will also focus on imparting best practices and technologies from each business
throughout the organization.

CX 1033 at 5.4 In July 2002 CB&I again acknowledged that the acquisition of PDM’s EC and
Water Divisions “enhances our engineering and execution capabilities” and “provides access to an
expanded customer base” (CX 1021 at 36 (internal page 30)). PDM’s entire body of relevant
know-how, experience and customer relations was disseminated throughout CB&I following the
Acquisition. In July 2002 CB&I informed investors that it would execute the following growth
strategy:

Leveraging the Strengths of Howe-Baker and the PDM Divisions. Our acquisitions

of Howe-Baker and the PDM Divisions have broadened our capabilities and

resources to meet customer needs in our end markets, and we intend to focus on

imparting best practices and technologies from each business throughout the

organization.

Id. at 6 (internal page 2) (emphasis added). Following the Acquisition CB&I informed investors

that its acquisitions of PDM’s EC and Water Divisions “Enhances CB&I management team

24 CB&I explained how its acquisition of PDM’s EC and Water Divisions enhanced
CB&I’s product and service offerings:

On February 7, 2001, we acquired the Engineered Construction and Water
Divisions of Pitt-Des Moines, Inc., which specialize in the design and
engineering, fabrication and construction of products for the petroleum,
petrochemical, cryogenic, liquefied natural gas, defense and aerospace
industries, as well as water storage and treatment facilities. This acquisition
enhances our engineering and execution capabilities, provides access to an
expanded customer base, and is producing significant synergies from the
application of best practices and the elimination of duplicative costs.

CX 1033 at 3-4 (emphasis added).
11


@ Tar Sands

— CB&l performs extensive work with Syncrude on their Fort McMurray
project and constructed the world’s largest coker reactor

@ Hydrogen Generation
— CB&l has engineered and constructed over 170 hydrogen plants

@ Fuel Cell

— CB&l has a JV with a subsidiary of United Technologies to design and
build Fuel Cells for residential and industrial use

@ Gas to Liquids

— CB&l is part of ConocoPhillips’ proprietary design team and developed
and built their pilot facility in Ponca City, Oklahoma

@ Wind Energy

— CB&l is working with industry leading partners to leverage our strength
in steel structures to this fast growing market

19


Forward Looking Statements

Certain statements made in this presentation constitute
forward-looking statements, within the meaning of the Private
Securities Litigation Reform Act, regarding the Company's
future plans, objectives, and expected performance.
Statements that are not historical facts, including statements
accompanied by words such as “believe,” “expect,” “estimate,”
“intend,” or “plan” are intended to identify forward-looking
statements and convey the uncertainty of future events or
outcomes. The Company cautions that any such forward-
looking statements are based on assumptions that the
Company believes are reasonable, but are subject to a wide
range of risks, and actual results may differ materially.


In.2001,Trunkline LNG;a Southern Union Company, chose to expand its
Lake Charles, Louisiana LNG import terminal to meet increasing
demand. The expansion would include increasing the terminal's
unloading, storage and send-out capabilities. It was also critical to
Trunkline LNG that operations of the existing facility not be interrupted
by work on the expansion and that the project be completed as quickly
as possible. Critical to the successful completion of the project was the
selection of an EPC contractor, and in 2002 the company selected CB&d.
Tomeetall of Trunkline LNG's requirements for the expansion, we called
‘on resources from around the world to execute the complex project.
Engineering expertise was combined with procurement capabilities on
three continents and an experienced project team with a history of
proven performance in existing facilities in Louisiana.

As the EPC contractor, we designed the unloading, storage and send-
‘out systems to meet code requirements, to incorporate innovative
ideas from our best practices and to blend smoothly with maintenance
and operation of the existing facility. To procure the cryogenic
vaporizers, pumps, unloading arms, recondenser, valves and 9% nickel
material, our engineering and procurement groups worked together to
develop specifications that incorporated both Trunkline LNG and CB&d
requirements for design, operability, quality and schedule.
Additionally, the Trunkline LNG and CB&l project teams, Trunkline LNG
plant operations personnel and selected vendors together explored
varied designs and details to find solutions that provide the latest
technology yet fit well with the existing facilities operating procedures.

While engineering and procurement proceeded, our project team
addressed the many construction issues that every project of this type
presents. We focused on how to construct a cryogenic facility safely and
‘on schedule within the confines of an existing facility. Many constraints
had to be addressed using new ideas based on our past experience. We
created procedures for working within the close confines of the existing
facility that did not endanger the existing facility or its operations.
Critical to the safe installation of equipment was the development of
ways to lift new components into position without lifting over or
threatening operating faci

Additionally, Trunkline LNG operations personnel and the CB&d project:
team had to find the means to integrate the new systems into the
existing mechanical and electrical systems without endangering

personnel or equipment. This integration, or tie-in process, was
addressed in two ways during the planning process. In many instances,
methods for isolating a specific component in a manner that allowed
safe work and did not interrupt plant operations were developed.
Integral to development of these methods were our construction
personnel, project engineer, project safety manager and corporate
safety staff. Not all the tie-ins could be accomplished without
interrupting plant operations. By working with Trunkline LNG project,
plantand scheduling groups, CB& planned two short duration outages
to minimize plant shut down and the impact on ship unloading
schedules.

In October 2003, the CB&l project team mobilized to the site to begin
installation of the pile cap foundation for the new storage tankas well as
to initiate other civil work on the site. Since then, installation of the pile
cap has been completed. The storage tank's outer bottom and portions
of the outer shell and roof have been erected. Dikes for the new tank as
wellas underground piping in the tank area are also being erected.

Work in the process area began in earnest in 2004 with the installation
of foundations for a new pump building, recondenser and vaporizers.
Portions of the underground piping were installed, as were tie-ins that
could be made without an outage. By completing these tie-ins early in
the project, the project team shifted work from very late in the schedule
so that amore balanced work plan was created.

The CB&l project team that is responsible for safety, quality and
schedule on the project has a varied background but brings many years
of experience doing work on the United States Gulf Coast to the project.
By blending experiences, in the construction of LNG storage tanks,
process piping and petrochemical outage work, along with an absolute
commitment to safety, the project team provides the knowledge and
experience necessary to plan and delivera successful project.

Wayne Nixon



WE Process and Technology

waa Pressure and Vessels

‘Specialty and Other Structures
25 Repairs and Turnarounds
I Low Temperatures Cryogenic: Tank and Systems.

MMM Standard Tanks

Specialty and Low Temperature
Other Structures Cryogenic Tanks

Te 24.1%
89%
20.4%
14.8% Standard Tanks
22.1%
ABA%
2000 2004 ;
CAGR = Compound Average Growth Rate Repairsand 7

Pressure Vessels Turnarounds


AUSTRALIA

CB&I Completes Clean Fuels Project in Australia

CB&l provided the engineering, procurement, construction and pre-
commissioning for a new hydrodesulfurization (HDS) plant at Shell's
refinery in Geelong, Australia, participating in one of the major
refinery development projects in Australia.

CB& hasalong tradition of working in Australia and has participated in
major refinery development projects in Australia for more than 50
years. In March 2002 CB&l was awarded a lump-sum turnkey EPC
contract valued in excess of A$90 million (approximately US$50 million)
by Shell Refining (Australia) Pty. Ltd. for a new Hydrodesulfurization
(HDS) plant at Shell's refinery in Geelong, Victoria, Australia. Our
relationship with Shell is very extensive on a global basis and, in
Australia, has included involvement in the most recent major projects
undertaken at both the Geelong Refinery near Melbourne, and Clyde
refinery in Sydney. The Shell Geelong Refinery, situated approximately
70km Southwest of Melbourne, is the second-largest refinery in
Australia and produces 15 percent of the country's petroleum products
{around 5.3 million tonnes of material per year) and about 50 per cent of
Victoria's petrol. This 50 year old refinery is the larger of the two Shell
refineries in Australia,

Following the global drive to cleaner petrol and diesel, the HDS plant,
which has a design capacity of 6,000 tonnes per day, is designed to
enable Shell to produce ultra-low sulfur diesel to meet the Australian
Government's new clean fuels specifications that will become effective
from January 2006. The plant acts as a reactor, removing sulfur from
diesel by converting it into hydrogen sulfide, which is subsequently
converted into solid sulfur for use as fertilizer. Lowering the sulfur
content of diesel in turn reduces particulate emissions from diesel
engines, resulting in a significant improvement in air quality. CB&l was
responsible for the detailed engineering, procurement, construction
and pre-commissioning of the project.

Site works began in early July 2002 with the clearing of disused plant
and excavations in preparation for pouring of 3,400 cubic meters of
concrete which would form the foundations for the plant.

In parallel with the civil works, mechanical erection of 14 pipe rack and
process modules started in late July 2002 at a yard established
specifically for modularization. This yard was located on the Brisbane
River approximately 2,400km to the north of the Shell site.

Mechanical erection at the Geelong site commenced with the
placement of pipe rack modules, 24m(L) x 8m(W) x 7m(H), onto
foundations at the end of February 2003. In all over 500 tonnes of
modules were placed by the end of June 2003. The centerpiece of the
plant, the 300 tonne reactor, was placed in October 2003 with
mechanical and electrical and instrumentation works continuing
through to early 2004.

Our team worked hard to meet Shell's best-in-class operational criteria,
Australia's most southerly sited refinery is now equipped to produce
fuels with a sulfur content of less than 50 ppm to meet the country's
new fuel specifications and to help secure its long-term future.

Mike Trzeciak



structures, over 15% of the world's offshore semi-submersible/tension leg
platforms, and numerous subsea flow lines, trunk lines and production/riser
systems.

In addition to gravity based structure designs, CB&I has the technical
capabilities and experience to develop offshore LNG terminals based on more
traditional jacket substructures and topsides for the regasification equipment.

CB&l is one of the world's leading EPC companies, specializing in lump-sum
turnkey projects for customers that produce, process, store and distribute the
world's natural resources. With more than 60 locations and approximately
10,000 employees throughout the world, CB&I capitalizes on its global
expertise and local knowledge to safely and reliably deliver projects virtually
anywhere. Information about CB&I is available at www.CBlepc.com.

For Further Information Contact:

Media: Bruce Steimle (832) 513-1111
Analysts: Marty Spake (832) 513-1245

News Releases...

© Copyright 2004 Chicago Bridge & Iron Company NV,
Legal Information (General Provisions)
All Rights Reserved.


from its headquarters in The Woodlands, Texas, which today still serves as CB&I’s own
operations headquarters.’ Moreover, PDM EC’s offering memorandum described the global
scope of its sales,'” procurement capabilities,'* operations and strategic alliances," all of which
contributed significantly to PDM EC’s profitability and financial viability.”” CB&I similarly
informed investors, following the Acquisition, that CB&I’s “global reach makes us an attractive
partner for large, global energy and industrial companies with geographically dispersed operations
and also allows us to allocate our internal resources to geographies and industries with the greatest
current demand.” CX 1033 at 4; accord Attachment A at 9 (“Bonny Island”). Thus, by CB&I’s
own account, large, global energy and industrial companies are more likely to select CB&I for
projects in the United States because of CB&I’s ability to meet the customers’ needs throughout
the world.

Moreover, innovations developed or implemented by the merged firm throughout the world

16 CX 522 at TAN 1003368; CB&I Global Locator, http://www.cbiepc.com/locator/
(CB&I’s Worldwide Administrative Office is located in The Woodlands, Texas).

v In the three years prior to the Acquisition one-half of PDM EC’s sales were
outside the United States. CX 385 at 21 (internal Page 18).

8 PDM EC had a strong global procurement organization which enabled it to
purchase steel plate and other materials on a competitive worldwide basis. CX 385 at 16
(internal Page 13).

9 PDM EC reported that in order to participate effectively in markets outside the
United States, PDM EC maintained strategic alliances with engineering and construction
companies in China, India, Australia, South Korea, Mexico, and Saudi Arabia. CX 385 at 4-5, 8
(internal Pages 1-2, 5); see CX 802. PDM EC explained that these alliances complement PDM
EC’s technology and project management capabilities by providing local capabilities in regions
outside the United States and allowing PDM EC to pursue global projects. CX 385 at 5, 8-9
(internal Pages 2, 5-6).

20 According to PDM EC’s offering memorandum, its global strategic alliances
enabled PDM EC to obtain higher margins for its technical and project management services.
CX 385 at 9 (internal Page 6).


suzanrie Gates

‘Design:
‘Mark West :
Tel: 44 (0) 207.957 3696

Print: «
‘AOK Printers

In this issue

Welcome.

3 WELCOME TO CB&I WORLD
Welcome message by Gerald Glenn

News

4 NEWS AND CONTRACTS

World Focus:
Current Projects

5 EUROPE
Buzzard

6 RUSSIA & FSU
Leading the Way in the Caspian:
CB&I John Brown has increased its
involvement in Azerbaijan and
Georgia on one of the largest pipeline
projects in the world today

7 Building the First LNG Plant in Russia

8 MIDDLE EAST
‘CB&I Completes Oil/Water Separation
Facility in Qatar

Sohar Refinery Project

9 AFRICA
Bonny Island: Participating in one of
the largest construction projects in
Africa and the fastest growing LNG
project in history

‘ASIA
Shanghai Ethylene Cracker Complex
(SECCO)

11 AUSTRALIA
CB&l Completes Clean Fuels Project
in Australia

NORTH AMERICA

LNG Expansion Project:

The expanded Lake Charles terminal is
North America's largest operating LNG
terminal

13. CENTRAL & SOUTH AMERICA

CB&I Helps Complete Choloma,
Honduras, Power Plant in Record Time

Special Features

14 WIND ENERGY

CB&i - Supporting the Development
of Wind Energy

Business Profile

WATER STORAGE AND
WATER TREATMENT

16

Technology & Innovations

17. COKE DRUMS DESIGNED

FOR LONGER LIFE

Marketing News

18 3-D Animated Videos
Tradeshows
New Brochures
Hot off the Press
Safety
19 SAFETY FIRST

This documents intended for general information purposes only and does not in
certain countries or political subdivisions



CBI

Global mix of crude supply is changing

— Decreasing production of light crude in fields of the U.S., North Sea and Saudi Arabia

— New sources of crude.in Venezuela, FSU, Tar Sands and Saudi Arabia are heavier
than the sources they are replacing.

— Changing mix is driving premiums for light crude in excess of $10/barrel

@ Significant refinery investment is needed to yield equivalent high-quality
fuels from heavier crude

— Hydrocrackers — Cokers
— Residual Fluid Catalytic Cracking Units - Increased desulfurization capacity
— Continuous Catalytic Reforming

@ CB&l has many years of experience constructing these units for our
customers and is well positioned in this market

“Refiners, already working flat out to meet rising world fuel demand, face a major chall
world crude-oil output toward (heavy) grades that are more:expensive-and difficult top
be produced from:such grades, but the world’s refiners will have-to put up hundreds of
their plants:first. The shift to lower quality. crudes also will force them to invest more tc
environmental fuel specifications.” is ae

Karen Matusic, September 1, 2004 in The Wall Street



ATTACHMENT D

CB&I Supports Offshore LNG Terminal Development
Available at http://www.cbiepc.com/ir/release.aspx?releaseid=138676


| Safety

Safety First

At CB&d, we believe that safety starts the minute we scope the project.
Asan integrated services company, we ensure health and safety in the
same way that we achieve quality - by implementing rigorous controls
though every phase of our projects. Our ultimate goal is the delivery of
‘our services with zero injuries to our employees and subcontractors
while causing no harm to the environment. Our health and safety
management program and extensive employee training have resulted
in one of the best safety records in the industry. Year after year, our
OSHA lost workday cases and recordable cases have been far lower than
the industry average as reported by the U.S. Bureau of Labor Statistics.
We've executed thousands of projects without a single lost workday or
recordable incident. And our projects have garnered numerous safety
awards from customers, industry associations, and safety organizations
worldwide.

Safety Benefits the Customer

We make safety our top priority because it is the right thing to do. But
wealso know that safety benefits our customers. It:

+ Reduces costs A strong safety record reduces our customers’
labor costs and the expenses they incur for supervising their
contractor's safety practices.

+ Lessens risk Safer work practices reduce the chance of an
incident occurring at the customer's facility and therefore
reduce the customer's liability.

* Minimizes impacts Our global Crisis Management Team is
trained to respond quickly in the event of a natural disaster,
operational upset or unlikely construction event. Their
knowledge and preparedness is key to minimizing the impact
ofanincident.

+ Improves compliance Our safety focus helps customers
comply with applicable regulations and standards.

* — Ensures peace of mind Our customers can be confident they
have a capable, safety-focused contractor with well-trained
personnel on the job.

Safety is the responsibility of every employee at CB&d, and zero injuries
is our foremost goal. Around the world, our trained personnel work to
ensure the safety of themselves, their coworkers, the customer and the
public.

Safety News
CB&l Howe-Baker receives Excellence in Safety Award

(CB&I Howe-Baker was recognized for its exemplary safety record by the
Gas Processors Suppliers Association when it was presented with the
prestigious Excellence in Safety. Award at the annual Gas Processors
Association meeting held in March 2004 in New Orleans, La. CB& Howe-
Baker was one of only two contractors to receive this honor, which was
presented “in recognition of an outstanding Safety record and ongoing
efforts in the development of an exemplary Safety Program in the Gas
Processors Suppliers industry”,

CB&dl Constructors Crew at El Segundo Refinery Receives Safety
Award

CB&l Constructors crew at the Chevron refinery in El Segundo, Cal
recently was recognized for its exemplary safety performance. In Maft
2004 the El Segundo crew received the 2003 GOLD Safety Awarq
Chevron for outstanding safety performance during
Contractor Award Ceremony.

dj

Standard: CB&I John Brown has struck GOLD again
jp:Brown was awarded a RoSPA Gold Award for Occupational
following receipt of this award in 2003 and 2002. RoSPA
de to organizations that demonstrate an ongoing
poe ee health and safety, and that are able to

prove they hayé implemented the guidance contained in the Health
e's (HSE) publication “Successful Health and Safety
delighted that our commitment to exemplary
ield of health and safety has been recognized.

and Safety Ex
Management’,
performancein

CB&I Matrix Hon

d by Texas Safety Association

CB&I Matrix was recently selected as a recipient of the Texas Safety
Association's highest: jor, the prestigious Chairman's Award for
outstanding safety pes and records. The award was presented to
CB&l Matrix at the Openi ig, Session of the Texas Safety Association's
2004 Annual Conferet San Antonio. According to Safety
Coordinator Jeanie Sistrupk,,CB&l Matrix has achieved success by
“Designing and Building with Safety First’through the helping hands of
qualified and well-trained: ees who continuously strive toward
their goal of an accident-frée workplace. CB& Matrix has a strong belief
that all accidents are prevehtable; a framework consisting of proper
policies, procedures ant ining methods, and a supportive
management team that pla afety as Top Priority’.

NPRA Recognizes CB&d for Safety Achievements at National Safety
Conference ae

9fésented with awards by the National
n (NPRA) for their exemplary record
rds presentation took place during
‘as part of NPRA's National Safety
‘Austin, Texas. At the safety awards
‘ious facilities in the petroleum and
\dustries, as well as the contractors
had achieved the highest possible
rations in 2003. NPRA Chairman of
‘Officer of Valero Energy Corporation
ptal of 621 awards to 76 refineries, 94
“sites with contractor. recognition. CB&I
ive a Contractor Award for Meritorious
i¢ 8 facilities with contractor recognition.
ators that have achieved a total recordable
for the 2003 calendar year at an individual
jum of 20,000 hours at that particular site.

‘ted with a Contractor Award for its work at
mont refinery. This facility also received the
Hon Distinguished Safety Award. Randy Hynek,
3f Safety, was in attendance to accept the award.
hich is the construction subsidiary of CB& Matrix,

a Contractor Award for its performance at the
‘Memphis, Tenn. Gerald Whatley, Safety Director for

Several CB&I subsidiaries wet
Petrochemical & Refiners Ass
of safe operations in 2003. TI
the safety awards banquet ‘hi
Conference April 27 - 29, 20
banquet, the NPRA recognized.
petrochemical manufactu
supporting those industri
safety standards in their di
the Board and Chief Oper:
William R. Klesse presente;
petrochemical plants an
was one of 81 companies t
Safety Performance at t}
This award is given to con
incidence rate of 1.5 0
site and have worked g

CBI Services Inc. wasipi
the CITGO Petrolet

2003 Honorable



2 yee
Construction|

CB&l is a specialty engineering, procurement and construction company.
Since 1889, we have built upon our technical capabilities, our expertise and
our financial strength to become one of the world’s leading contractors.

Our business strategy is to provide lump-sum turnkey projects to customers
that produce, process, store and distribute the world’s natural resources. We
offer a complete package of integrated engineering, procurement, fabrication
and construction services to deliver projects safely, on time and within budget.

We have more than 40 offices located throughout the world. Our global
expertise and knowledge of local regulations enable us to reliably deliver
projects virtually anywhere.

To learn more, please visit: www.CBlepc.com

Focused » Competitive + Local
Results Second to None

www.CBlepc.com

production | processing | storage | distribution |
i lone wg x



Global Leader in LNG

@ Strong capability across the entire LNG spectrum: Import Terminals,
Export Terminals, Offshore Terminals and Peak Shaving Plants

@ Engineered and erected more than 40 LNG terminals and peak
shaving plants

@ Engineered and erected more than 1,100 low temp/cryogenic tanks
@ Designed and erected first peak shaving plant

CB&I is Poised to Capitalize on these Trends

® Currently working on 10 LNG projects with total revenue of
approximately $2.5 billion

@ Tracking 40 to 50 LNG opportunities worldwide with potential
revenue totaling $5 billion to $10 billion.

13



MIDDLE EAST

CB&I Completes Oil/Water
Separation Facility in Qatar

CB&d first executed work in Qatar in 1969. Since then, we have
accomplished dozens of projects in country and are proud to have
played an important role in the development and expansion of the
Qatarioilandgasindustry.

In June 2002 CB&l was awarded a lump sum turkey contract by
Occidental Petroleum of Qatar (Occidental) for the engineering,
procurement and construction of new oil/water separation facilities
offshore of Qatar. The Halul Island PWHF Project is part of Occidental's
ongoing development of the Idd El Shargi North Dome and Soyth
Dome offshore oil fields located approximately 80 kilometers northeast
of Doha in the territorial waters of the State of Qatar. Halul Island is a
storage and export terminal for Qatar's offshore oil. The island (about
1.5 sq. km) is home for 11 giant crude oil storage tanks, pumping
stations, power generation, water desalination plants and a heliport in

addition to staff accommodation, sports and recreational facilities. °

Known as the PS-1 Produced Water Handling Facilities (PWHF) on Halul
Island, CB& was responsible for the engineering, procurement,
installation and commissioning (EPIC) of new oil/water separation
facilities for crude oil and produced water from Occidental's offshore
PS-1 production complex. Today, the facilities are able to process up to
435,000 barrels per day of liquids.

The project involved the construction of two 150,000 barrel capacity

separation tanks, crude oil pumping and fiscal metering facilities,

pumping and filtration facilities, a remote flare system, a local

equipment and control room and associated facilities. CB&I were

responsible for the engineering, supply and on-site construction of the

facilities. The plant is now being commissioned. CB&I completed the
oje 00

Sohar Refinery Project

CB&l has worked in Oman since the 1970s and has built several large-
scale tankage projects, including a 600,000-barrel storage facility in
Muscatin 1999 anda 1 million-barrel storage facility in Mina al Fahal
in 1993. Today CB&I is participating in the major Sohar Refinery
Project - a top-priority project in Oman's energy strategies, which
when finished will provide the refinery with more than 1 million cubic
meters of bulk liquid storage and more than 40,000 cubic meters of
pressurized storage for propylene and liquefied petroleum gas.

The Sohar Refinery is to be built in Sohar, about 250 km northwest of
Muscat, the capital of Oman. The refinery is owned jointly by the
Sultanate of Oman and Oman Oil Co. CB& was awarded a $50 million
contract for all tankage at the grassroots Sohar Refinery in November
2003. CB&i's work scope includes engineering, material supply,
fabrication, construction, testing, painting and insulation of 55
miscellaneous storage tanks, 16 spheres and one elevated water
storage tank. In total there are 39 uniquely designed structures
amassing 25,000 metric tons of steel.

To help overcome the difficulties associated with engineering 39
unique structures, CB& engineering has implemented the philosophy
of standardizing components and drawings. For example, nozzles, man
ways, sumps as well as many other tank and sphere components are
detailed on one or two drawings for all structures instead of individual
drawings for each structure, In addition to reducing the number of
drawings by 20%, the standardization allows for fabrication to be done
inan assembly line manner instead of waiting for individual drawings to
be completed for each structure before commencing the work for a
particular structure. Another significant achievement has been the
advance billing of all material in addition to the main steel plate, which
is typically done for tanks and spheres. This has allowed us to more
easily consolidate purchase orders for other items such as pipe,
pipefittings, flanges and structural steel. In addition to the cost benefits,
the end result has been that much of the material is arriving well ahead
ofthe construction need dates.

We are now moving into the construction phase of the project, and we

have mobilized nearly 300 people to site. One of the biggest challenges
that we will now face is the requirement to employ a workforce
containing 30% local employees and yet maintain the productivity
levels we expect from our experienced crews. We have made the
commitment to not only hire the required numbers of local employees
but also to train and integrate the local employees as productive
members of our international work force. Within three weeks of award,
with the help of the local labor authorities and government sponsored
training organizations, CB&d recruited 60 locals to participate in a six
month training program. After each recruit passes the training program
the new employee will be: integrated i into our experienced crews where
It i



CBI Forecast for Heavy Crude Upgrades

ae _ Heavy Crude Upgrade Awards Expected in 2004-2008 -
12.0 5

11.0
10.0 5
8.0
a 8.0 5
6 6.5
m 80} 5.0 .
° 4.0
4.0 +
_ f
0.0 T T r r 1
N. America Europe Latin America Asia Mid-East &
Source: Frost & Sullivan Africa

@ Investment decisions driven by spread between light and heavy crude
prices
@ Market forces will determine the level and timing of upgrades

@ CB&I’s global execution capabilities enable us to participate in all key

markets 16


About

ENGINEERING + PROCUREMENT + CONSTRUCTION

CBad

Investor Relations

[Search :

contact us careers

OurTeam
of Compar

“TM\ Technologies
nies & Services

< HOME : INVESTOR RELATIONS : NEWS RELEASES : RELEASE

Corporate Profile
Corporate Governance
Detailed Stock Quote
News Releases

SEC Documents (EDGAR)
Annual Reports Online
Presentations and Webcasts
Event Calendar .
Analyst List

Receive News by E-Mail
Printed Materials Request
Earnings Estimates
Financial Fundamentals
Dividend History

CB&I Supports Offshore LNG Terminal Development

THE WOODLANDS, Texas -- July 12, 2004 -- Leveraging its decades of
experience and leading technologies in liquefied natural gas (LNG) storage and
offshore structures, CB&| (NYSE:CBI) now offers a variety of solutions for the
design and construction of offshore LNG import terminals.

One such solution combines conventional cylindrical LNG storage tanks with a
concrete gravity based structure (GBS). Ideal for shallow water environments
such as the Gulf of Mexico, CB&l's GasPORTH concept offers significant
advantages in terms of shorter schedule, lower cost and flexible design using
proven technology.

CB&l's GasPORT incorporates a concrete GBS as the primary component
acting as the foundation and support structure for the facility. The terminal is
equipped with integrated facilities for mooring and berthing of the LNG carrier;
berthing of supply vessels; LNG unloading, storage and regasification; utilities;
natural gas transport to shore; and crew accommodations. LNG storage is
provided in a series of conventional cylindrical tanks that are anchored to the
GBS.

GasPORT is designed to withstand the adverse environmental conditions
typically found in offshore locations. Design loadings have been factored into
CB&l's terminal concept to achieve maximum reliability and safe operation.
CB&I's engineers have evaluated wind, wave states, scour and anchorage of
the GBS on the ocean floor, as well as graving dock, towing and mooring
requirements in their design considerations.

“Drawing upon more than 65 years of combined experience in the LNG and
offshore industries, we believe our GasPORT LNG terminal concept offers a
cost-effective and reliable solution to help meet the growing U.S. demand for
natural gas," said Gerald M. Glenn, CB&l's Chairman, President and CEO.
“We're pleased to offer this new development, based on proven technology and
our unparalleled experience, as well as a number of other offshore terminal
concepts to companies seeking to tap the burgeoning LNG import market."

CBa&l is in a unique position to offer full engineering, procurement and
construction (EPC) services for offshore LNG facilities. A pioneer and
technology leader in the LNG industry, CB&I has designed and constructed
more than 40 LNG terminals and peak shaving plants and more than 200 LNG
storage tanks around the world. Furthermore, with the broad offshore
experience and capabilities of its CB&I John Brown unit, CB&I's integrated
approach to offshore LNG import terminals leverages extensive worldwide
offshore project background and technology. CB&l John Brown has been
responsible for engineering and project management of more than 100 jacket


A. The “Relevant Business” as Defined in the Commission’s Final Order Is the
Appropriate Business from which New CB&I and New PDM Should Be Created to
Restore Competition to the Relevant Markets.

CB&I and PDM were roughly equal competitors prior to the Acquisition. May 10" Order
at 23. Respondents concede that an effective divestiture would need to include assets related to
businesses outside the Relevant Products,° and enough assets to re-create the combined former
PDM Engineered Construction (“PDM EC”) and Water Divisions for the resulting entity to be
competitively viable.’ Indeed, the record in this proceeding establishes that an effective and viable
remedy requires divestiture of assets beyond those involved in the construction and sale of the
Relevant Products and water tanks.

Nothing in Respondents’ Further Briefing provides a reliable basis on which to narrow the
scope of the definition of “Relevant Business.” Respondents’ statements are either wholly
unsupported or are based on incorrect or misleading assertions about the scope of PDM EC’s
assets and capabilities prior to the Acquisition.

The definition of “Relevant Business” in the Final Order is consistent with the broad scope

of PDM EC’s capabilities and operations as it existed prior to the Acquisition by CB&I and

accomplishes the purpose of divestiture — to eliminate the anti-competitive effects of the

6 See, e.g., Leon, Tr. 8311-12 (“[I]f you were only to spin off some personnel and
assets to make products in these markets, that company would wilt like a rose left out too long.
There is not enough business. So, you would have to give it all this other stuff to make flat
bottom tanks, to make gravel (sic) tanks, to make all kinds of other stuff. You would have to
give it enough personnel so that everybody would have the expertise to do every kind of tank”);
Simpson, Tr. 3607 (“an entity that would be divested would have to include assets that would
enable the divested firm to compete not just in the markets in this case but also in markets such
as flat bottom tanks, egg-shaped digesters and water tanks.”).

7 See, e.g., Scorsone, Tr. 4779-80; CX 552 at 45-48, 52-53 (Braden, Dep.); Byers,
Tr. 6780.


2004 % of Revenue
by Region

Ft. S3 ewan ,
- Calgaty «
Evei a"
Sacramento/ ‘i Ni
Concord ¢ Plainfield,

San Luis Obispde_, New Castle.’

\

Pre

Los Angeles’. Pallesqyler Atlanta
\ mont i
“Vtousten Shanghai
, J Sap.
North ren ica Manila Asia Pacific
fo 9%
y
Brisbane

Central and
South America
4%

CB&l operates a global network of sixty facilities and has the capability to rapidly
mobilize people, materials and equipment virtually anywhere in the world.



CBI Fully-Integra

Conceptual Design Detail Engineering Global Procurement

In-house Fabrication

Start-up and

Field Erection Mechanical Installation Operator Training Commissioning

CB&I delivers projects from
“concept to commissioning” on 3


Cc. The Final Order and the Divestiture Application Process Provide Appropriate Means
for Determining, at the Appropriate Time, What Assets, If Any, Within the “Relevant
Business” May Be Excluded from Divestiture.

In their Further Briefing, Respondents express numerous objections to the definition of
“Relevant Business,” which they claim is overly broad. However, Respondents have provided no
reliable basis on which to narrow the definition at this point in the proceeding. Moreover, pending
finality of the divestiture obligation, CB&I will be in control of the location, organization and
disposition of the affected assets and businesses subject only to the Final Order’s asset
maintenance requirements. Respondents have not suggested that they would be prejudiced if their
proposed exclusions of assets arguably within the definition of “Relevant Business” were deferred
until the Commission or its staff could conduct a meaningful evaluation of such proposals,
particularly with reference to potential divestitures to potential Acquirers.

Complaint counsel believe that narrowing the scope of the definition of “Relevant
Business” at this point in the proceeding could irreparably prejudice the Commission’s ability
ultimately to achieve effective, viable and competitive divestiture relief. We also believe this is
not necessary because the Final Order itself and the divestiture application process provide
appropriate opportunities and procedures through which Respondents can present and substantiate
their arguments on the scope and nature of assets to be divested.

Indeed, the Final Order allows Respondents to determine, in the first instance and
consistent with Paragraph III., the specific assets of the Relevant Business to be assigned or

transferred to “New PDM” and to “New CB&I.””® Further, the proviso to Paragraph IV.A. of the

26 CB&I is required, inter alia, to reorganize its Relevant Business into two entities,

each “fully, equally, and independently engaged in all aspects of the Relevant Business.” Final
Order { I1.A. Because CB&I will be entitled to retain one of these entities, it should have the
proper incentives to ensure each entity meets this standard. The Final Order also includes
provisions for appointment of a Divestiture Trustee (Final Order { V) “to ensure that CB&I has

15


Clean Fuels Spending Driven by Regulatory Mandate

@ U.S., Europe, Australia, Japan and India all have existing legislation
to lower sulfur content in gasoline and diesel fuels

@ These regulations not only affect refineries in these countries, but all
refineries that import to these markets

@ US. standards need to be achieved by 2007 (gasoline) and 2010
(diesel)

@ Rest of world has varying standards and timelines for clean fuels
implementation that will continue to drive spending thru 2010

CB&I Continues to Win Clean Fuels Projects
@ Recognized leader in hydrogen plants and desulfurization units
@ Constructed 9 of last 11 CCR units built in US

@ Currently working on 19 clean fuels projects with total revenue of
more than $900 million

1

5


Financial
Results


appointed by the Commission) and Commission staff, prior to the Commission’s final review of
the specific divestiture package and Acquirer proposed by CB&I or a Divestiture Trustee. The
Commission’s review will be conducted in accordance with the agency’s established practices for
reviewing divestiture applications.” Significantly, in the divestiture application process pursuant
to F.T.C. Rule of Practice 2.41(f), 16 C.F.R. § 2.41(f), Respondents will be required to establish
“with supporting materials” that the divestiture of “New PDM” to the proposed Acquirer will
satisfy the Final Order’s remedial purpose.’ This process will assure that all necessary facts
regarding the specific assets, including Customer Contracts, that CB&I proposes to divest and the
specific employees that CB&I proposes to allocate to each business entity it organizes (one to be
retained by CB&I and one to be divested) are considered at a time reasonably proximate to the
divestiture.

Respondents can therefore assert their arguments that certain assets should be excluded
from their divestiture obligation at the appropriate time and in the proper manner in connection
with the reorganization and divestiture application process so that the Commission and its staff can

fully evaluate the merits of such proposals.

» See Statement of the Federal Trade Commission’s Bureau of Competition on
Negotiating Merger Remedies (“Negotiating Merger Remedies”) at 2, 9-10, available at
www.ftc.gov/be/bestpractices/bestpractices030401.htm.

30 See Negotiating Merger Remedies at p. 9 & n. 29, citing Dr Pepper/Seven-Up
Companies Inc. v. FTC, 991 F.2d 859 (D.C. Cir. 1993) (in proceeding for FTC approval pursuant
to Rule 2.41(f), the burden of proof is on the party seeking approval to demonstrate that it should
be granted).

17


the Final Order already provides the means by which CB&I can submit for Commission approval a
proposed package of assets comprising “New PDM” from which any or all of the assets included
within the scope of “Relevant Business,” other than assets involving any Relevant Product, may be
excluded from the ultimate divestiture.> The Final Order and the divestiture application process
provide CB&I with the opportunity and “flexibility to decide how best to effectuate the Final

Order’s requirement,”*

via procedures in which CB&I can present and substantiate its arguments
on the scope of assets to be divested at the appropriate time, i.e., within the context of CB&I’s
proposed divestiture of “New PDM” to the Acquirer proposed by CB&I. Consistent with the
Commission’s findings, the Final Order does not limit relief to “the restoration of the status quo
ante” but rather provides that which is “necessary and appropriate in the public interest to
eliminate the effects of the acquisition offensive to the statute.”*

Removirig assets from the pool of those available for potential inclusion in the divestiture
on the basis of inaccurate and unsupported assertions could irreparably prejudice the
Commission’s ability ultimately to obtain a divestiture that remedies the lessening of competition
from the Acquisition. Accordingly, Complaint counsel believe it is premature and inappropriate to

exclude assets that may ultimately be needed to assure the viability and competitiveness of the

divested business. Therefore, Complaint counsel ask that the Commission affirm its Final Order.

3 See Respondents’ Further Briefing on Specific Remedy Issues (“Further
Briefing”) at 3 n.3, filed June 6, 2005 (citing Final Order 4 IV.A., which states “if the Acquirer,
with the concurrence of the Monitor Trustee, determines that acquiring any or all of [such assets]
is not necessary to achieve the purposes of this Order”). In addition, the Final Order allows
Respondents to determine, in the first instance and consistent with Paragraph IIL, the specific
assets of the Relevant Business to be assigned or transferred to “New PDM” and to “New
CB&I.”

4 May 10" Order at 23.

5 Op. at 94.


Marketing News

3-D Animated Videos

In 2004, CB&l plans to produce five videos on selected technologies.
The videos encompass the following subjects: Vertical Plate Coke
DrumTM Technology, Strata-Therm® Thermal Energy Storage (TES)
Technology, Sulfur Recovery Technology, Hydrogen Technology and
Gas Processing Technology. The videos are tools that utilize three-
dimensional computer animation to depict our technologies and EPC
services. Each video integrates computer-generated animated images,
photos and other graphics, along with voice narration and sound
effects, to describe the features and benefits of the technology on
which it is focused. Each video is available on CD-ROM, runs about 5-6
minutes, is playable on any computer system. We are looking at Arabic,
Chinese, Russian, and Spanish as possible languages for translation. In
2005, we plan to produce videos for other areas. For instance, within the
production and distribution markets served by CB&I John Brown,
videos for our offshore oil and gas production platforms and pipelines
are being explored.

Tradeshows

We will demonstrate our expertise, technology and track-record during
anumber of forthcoming global tradeshows:

Remaining 2004

11" ADIPEC, 10-13 Oct., Abu Dhabi, UAE

PowerGen, 30 Nov.-2 Dec., Orlando, FL, USA

European Wind Energy (EWEC), 22-25 Nov.,London, UK

2005

GASTECH2005, 14-17 March, Bilbao, Spain

NPRA Annual Meeting, 13 March, San Francisco, CA, USA

OTC, 2-5 May, Houston, TX, USA .

AWWA, 12-16 June, San Francisco, CA, USA

7thWorld Congress of Chemical Engineering, 10-14 July, Glasgow, UK
WEFTEC, 29 Oct-2 Nov., Washington DC, USA

PowerGen, 6-8 Dec., Las Vegas, NV, USA

New Brochures

Hot off the Press...

A number of CB&I employees have written articles that have been accepted in key
industry publications and trade journals. So far this year, published articles have
portrayed challenging projects, innovative technologies and critical regulatory
solutions.

“Think Tanks" - Hydrocarbon Engineering, September 2004 in October 2003,
CB&I completed 28 storage tanks and one butane sphere as part of a project that
provided Papua New Guinea with its first oil refinery. The article describes tank
designs and the procurement and construction challenges of performinga project
this size in a logistically remote area. The project is an excellent model of the
advantages of the EPC approach.

“Leading the way in the Caspian" - Pipeline & Gas Technology, July /August,
2004 A special report that profiles C8B&I's pipeline capabilities and the ways CB&I
John Brown uses latest technologies and engineering methods for SCP, BTC
pipeline projects. An overview of our past and current projects in the region and
engineering methods and technologies, such as state-of-the-art Geographic
Information Systems (GIS), isincluded.

"A Sense of Achievement" - MEED, July 2004 Features a special report that
profiles CB&i. Phil Asherman, Executive Vice President and Chief Marketing Officer
‘of CBl, was interviewed for the article which opens with a discussion of three of
the outstanding engineering achievements of 1969, including the Apollo moon
project, Boeing's 747 and CB&l's Khazzan offshore storage facility. CB&l's history in
the Middle East is noted, Current projectsin the region are described.

“Membrane Separation for Clean Fuels" - PTQ The article describes how
membrane technology can be used to remove sulfur from naphtha streams to
reduce the volume of product sent to the hydrotreater. This technology, named S-
BraneTM, can be integrated into a refinery's overall clean fuels strategy to effectively
remove sulfur atarelatively lower capital cost.

“LNG Storage Tanks: Advancements in Weld Inspections" - Hydrocarbon
Processing, July 2004 The article describes a technique developed and patented
to use ultrasonic technology instead of radiographic technology for non-
destructive examination of weld joints. It explains how CB&l has developed a
methodology and apparatus that provides us with the ability to use UT technology
forthese weld inspections and lists some of the advantages for doing so.

"advances in Egg-shaped Digester Design Enhance Life Cycle Benefits" -
Water and Wastewater International, June 2004 The article describes how
recent enhancements incorporated into the original anaerobic egg-shaped
digester (ESDTM) design have simplified mechanical systems. These improvements
have led to accelerated construction schedules and lower capital costs. Examples
from three CB&I ESD projectsillustrate this,

"Beating the Clock" - Hydrogen Engineering, April 2004 The article describes
how off-the- shelf design and modular construction can help refineries meet
deadlines for clean air and clean fuels regulations. Considerable cost savings can
be realized. Proprietary technologies developed by CB&l TPA can be used in
designing sulfur recovery units and tail gas treating units that meet regulatory
standards, These units can be fabricated offsite while permitting activity is still
underway, which can greatly accelerate tight schedule.

“CB&d - a wide range of services for the Russian Oil & Gas Market" - Oil & Gas
(CIS&EE), February 2004 The article, published in Russian, describes CB&'s wide
capabilities and services for the Russian oil and gas market.

“Time For a New Hydrogen Plant?" - Hydrocarbon Engineering, February
2004 The authors discuss alternatives for refinery operators concerned with
increasing hydrogen production in their plants and provide technical and
economic evaluation methodologies for determining how best to optimize the
plant while addressing the need for additional hydrogen.

“The Dominican Republic LNG Import Terminal: Challenges in Engineering,
Procurementand Construction" -LNG Journal, January/February 2004
Aprofile of an LNG import terminal built by CB&i on a lump-sum, turnkey basis for
AES Corporation in the Dominican Republic. This import terminal was completed
two months ahead of schedule, despite the remote location and challenging
conditions. The terminal, which was commissioned in 2003, provides anew, much-
needed fuel source for power generation in the country.


Leading the Way in the Caspian:
CB&l John Brown has increased its involvement in Azerbaijan and Georgia
on one of the largest pipeline projects in the world today.

Since 1948, CB&I John Brown has provided superior pipeline systems
safely and on schedule. We take pride in engineering and delivering
innovative, technically sound and cost-effective solutions. Today
CB&I John Brown is participating in one of the largest projects being
undertaken in the world, the AGT (Azerbaijan-Georgia-Turkey)
pipelines project.

The AGT pipelines project includes the construction of two major
pipelines, the Baku-Tbilisi-Ceyhan (BTC) oil pipeline and the South
Caucasus gas pipeline (SCP), as well as the associated above ground
facilities. The BTC pipeline is 1,768 km in length, and will send oil from
the Sangachal terminal near Baku on the Caspian Sea coast in
Azerbaijan, past Tbilisi in Georgia, and finally to the Mediterranean port
of Ceyhan in Turkey. CB& John Brown is responsible for corridor and
pipeline engineering for the Azeri and Georgian sections of the BTC
pipeline, and for construction engineering of the BTC pump stations in
Turkey. The South Caucasus Pipeline (SCP), 692 km in length, will
transport natural gas from the Shah Deniz field in the Caspian along the
same route as the BTC pipeline, through Azerbaijan and Georgia to the
Turkish border, and then into the Turkish distribution system. CB&/ John
Brown is the engineering and procurement services contractor for the
SCP from Azerbaijan to Turkey. The two pipelines largely parallel the
Western Route Export Pipeline (WREP), previously completed by CB&l
John Brown in 1999.

BTC Western Route.

The success of the WREP encouraged additional investment by the BP-
led international oil companies, leading to the award of further major
contracts to CB&l John Brown, for world-class oil and gas export
pipelines from the Caspian region. Today two new pump stations are
being installed on the Azerbaijan section of the BTC pipeline, two in
Georgia, and four in Turkey. The pipelines depart from the Western
Route approximately 20 km into Georgia and head to the
Georgian/Turkish border. In Azerbaijan, the BTC pipeline is 443 km in
length and 42" in diameter, and 249 km long and 46” diameter in

CB&I John Brown personnel are actively involved in all three countries,
and have a significant role in the BP-led Integrated Project
Management Team (IPMT) overseeing the engineering and
construction work performed by the contractors.

In Baku, we are providing project and pipeline engineering and
inspection ices, In Georgia, our staff are key players in the Technical
Group in Tbilisi, and on site along the pipeline route they are providing
construction management, field engineering, logistics and
construction inspection services.

In Turkey, we are assisting with project management support and
construction engineering services for the pump stations construction
and installation.

Using state-of-the-art geographical information system (GIS)
Under the client leadership and as part of the Caspian pipeline project
team, CB&l John Brown developed a project-specific GIS. This system
was used during the design phase of the projects, alongside more
established design software packages, such as AutoCad and PDMS.

GIS was used to manage, interrogate and interpret an extensive range
of available data, allowing the project team to develop detailed routing
and constraints maps to avoid known sensitive or densely populated
areas, cultural monuments and archaeological sites, and known geo-
hazards. Itis also used to maximize the safe, uninterrupted construction
and operation of the pipelines and the potential for reinstatement, and
to minimize the risk of oil spill and the amount of land required for
pipeline construction.

During construction and operation, the GIS allows rapid and effective
data management. The system proved to be an essential tool not only
during design, but also during the process of consultation with
governments and NGOs, as well as potentially affected communities
and interest groups at the local, regional and international level. As a
result of the meticulous route selection process, nota single person will
be required to move from their home because of the BTC and SCP
pipelines, nor will there be any permanent disruption to the livelihood
of the local communities. The GIS will also provide an active link to the
pipeline tracking system, enabling continuous monitoring of materials
movement and progress of pipeline installation and testing. During
pipeline operation, it will be an essential tool for pipeline surveillance,
maintenance and repair.

Rees Brislin


necessary to build the relevant products.”

Respondents were also to “address which assets outside
of the United States the ‘Relevant Business’ definition encompasses and why the inclusion of such
assets is unnecessary for an effective divestiture.” Jd. Finally, the Commission afforded
Respondents an opportunity to provide “an alternative suggestion for a divestiture package that is
consistent with [the Commission’s] findings.” Jd.

In response, Respondents have presented a series of conclusory, unsubstantiated and
inaccurate assertions in support of their arguments that the definition of “Relevant Business,”
which describes the scope of assets available to create a viable divestiture package that meets the
standards for competitiveness, marketability and economic viability set forth in the Order, should
be narrowed. As discussed herein, Respondents’ Further Briefing provides no reliable basis on
which to carve any specific assets out of the definition of “Relevant Business” at this point in the

proceeding.

Respondents’ alternative proposed relief would [

] the Relevant Products. Because it is impossible to
determine what the needs of potential Acquirers will be in the abstract, before any concrete
divestiture proposal has been submitted to the Commission, Complaint counsel believe
Respondents’ alternative proposal is insufficient to assure effective divestiture relief.

For these reasons, Complaint counsel believe the scope of assets included within the
definition of “Relevant Business” as it appears in the Final Order is necessary in order to ensure

that divestiture relief ultimately is effective and viable. Moreover, as Respondents acknowledge,

2 Decision and Order Partially Denying Respondents’ Petition for Reconsideration

and Directing Further Briefing on Specific Remedy Issues, at 24 (May 10, 2005) (“May 10"
Order”).


Gerald Glenn
Chairman,
President & CEO
40 Years

Richard Goodrich
EVP & CFO
28 Years

Stephen Crain
President, Operations
Western Hemisphere
27 Years

David Bordages
VP,

Human Resources
32 Years

Robert Jordan
EVP & COO
35 Years

Philip Asherman

EvP &

Chief Marketing Officer
27 Years

Walter Browning
VP, General Counsel
and Secretary

29 Years

Senior management average EPC

industry experience:

31

years 8


100,000. MW. In Europe, offshore wind

nergy produced, but this figure is set

1@ offshore wind farms are developed.
inparticular,is set to boom.

eeelaeg

Sane

det 3008 MW)
T9603,

den, Holland and Germany

rent UK legislation

f energy i is produced

uirces by 2010.and
I

installations is already bringing dows
so the prospects for large-scale expl ‘of Europe's:
large resource at modest-cost are becor ing i increas gly:
attractive. Additionally turbine'size‘oi
around 2MW, but offshore the target must be

in European seas. This will be equivalent to several larg straditi
fired power stations. Plans are currently advancing for: such wind parks
in Swedish, Danish, German, Dutch, Belgian; British.and Irish

The pace of technology development continues to be¥apid; partly due
to the research:and development programs currently: under- way: in
most of the industrialized nations, largely due to market’stimulation
programs. The primary aim of the market stimulation programs is:to
encourage the development of technologies with low (orin the case of
wind energy, zero) carbon dioxide and other emissions. Rapid growth in
Denmark, Spain and Germany shows no sign.of slowing and there ate
plans for further capacity in the United States, Canada, the Middle East
and: the Far East. With the development: of a numbet-of new: wind
‘energy ‘proposals in the ‘UK and Europe, and with such excellent
potential on its doorstep, CB&l with its extended capabilities to provide
services for upstream, downstream and now airstream, has the
opportunity to be at the center of this new industry. The design,
engineering and installation of offshore and onshore wind energy
requires just the type of skills and facilities that are already available in
CB&l.

CB&l OnshoreWind Tower Experience
CB& built support towers for wind turbines at Goldendale, We

and performed similar work on other towers built in Medicine Bow,
Wyoming: near San Francisco, California and in Hawaii. CB&I was a
subcontractor to Boeing Engineering and Construction Company Co,
which was the prime contractor on the structures for NASA and the U.S.
DOE. Each of the experimental turbines was capable of producing 2500
kilowatts of electricity. CB&I was contracted by Boeing to fabricate and
erect the support towers for three wind-turbine generators (WTG) in
Washington. The three WTGs are positioned 1500 to 3000 feetapartina
triangle on hills overlooking the Columbia River Gorge. As general
‘contractor, Boeing handled the installation of all other components.
easures 350 feet tall with blades vertical and weighs 316
attributed to the
200 feet

ind



investor Presentation

Credit Suisse First Boston
Engineering & Environmental Services Conference
June 2005 —


Bonny Island:

Participating in one of the largest construction projects in Africa
and the fastest growing LNG project in history

The Bonny Island LNG facility, situated at the southern edge of Rivers
State in the Niger Delta of Nigeria, Africa, is being developed by Nigeria
LNG Limited (NLNG). The NLNG is a joint venture company whose
shareholders are the Nigerian National Petroleum Corporation (NNPC)
49%, Shell Gas BV (Shell) 25.6%, Ceag Limited (Elf) 15% and Agip
International BV (Agip) 10.4%.

NLNG is one of the world's major exporters of LNG. In 1999 NLNG
commenced an Expansion Project to increase liquefaction capacity by
50% with the addition of a third LNG production train. The expansion
also added process units to produce more than 1 million tonnes per
year of liquefied petroleum gas (LPG). The project will utilize the gas
reserves of the eastern part of the Niger Delta by converting them to
liquefied natural gas for export to industrial customers in Europe and
Turkey. The LNG shipments leaving Bonny Island represent the first LNG
to be exported from sub-Sahara Africa, and the plant has one of the
world's largest single LNG trains, producing 2.95 million metric tons per
year. CB& was selected to design and build one full-containment LNG
storage tank, two double-wall LPG storage tanks, two smaller tanks and
associated foundations and civil works. We completed the work in early
2003, achieving a world-class safety record in the process on one of the
largest construction projects in Africa.

Our substantial experience in low temperature and cryogenic storage
terminals, coupled with our remote project execution ability, helped us
add value to this project from engineering through construction to final
commissioning. With the nearest major town, Port Harcourt, nearly two
hours away by boat, mobilization was challenging. Setting up the site
office, establishing reliable communications, recruiting and training
local workers, receiving tons of steel and beginning construction was a
massive undertaking... but one at which we have excelled for decades.
Our global reach makes us an attractive partner for large, multinational
energy and industrial companies with geographically dispersed
operations, and also allows us to allocate our resources to locations and
industries with the greatest current demand. In addition, because of
our long-standing presence in many markets around the world, we
enioya prominent position asa local contractor in those markets.

Building on our proven performance, in January 2003 CB&l in consortium
with Bilfinger Berger AG of Germany was awarded a contract in excess of
US$100 million by the TSKJ group of companies - EPC contractor for the
NLNG Expansion and Plus Projects - to provide civil and mechanical
erection services for NLNG Plus Project. This award demonstrated TSKJ's
confidence in our ability to execute complex technical projects, and
further solidified our position as one of the world's leading providers of
LNG liquefaction and storage facilities. CB&d is the mechanical erection
contractor for the construction of a fourth LNG production train with a
design capacity of 4.0 million tonnes per year, one of the largest capacity
units in the world. Our excellent worldwide safety record, well proven
QA/QC Management Systems, ISO 9001- Quality Management Program
and Environmental Procedures, which are established in accordance with
ISO 14001 guidelines, were instrumental in the company receiving the
award. Our scope includes structural, piping and mechanical erection of
Train 4 and the new area Offsite Works. Bilfinger Berger AG performs the
civil work forTrain 4, Ourteam mobilized on site in early 2003 and expects
tocomplete the projectin the spring of 2005.

PeterRano



Relevant Business since the Acquisition.”°

B. Respondents’ Alternative Proposal is Insufficient To Assure an Effective Divestiture
that Restores the Competition Eliminated by the Acquisition.

Without waiving their rights of appeal, Respondents propose to divest, in lieu of the

divestiture ordered by the Commission, [

] Further Briefing at 9, n.9 (footnote omitted). Respondents propose that [

]

Respondents’ alternative proposed relief would [

] the Relevant Products. For example, Respondents’

proposal would exclude from the divestiture [

] In addition, the Relevant Products are often

purchased as a component of a larger project including complementary products within the

25 CB&I’s revenues have tripled since the Acquisition, increasing from $612 million

in 2000 to $1,897 million in 2004. Attachment C at 7. CB&I’s revenues, in low
temperature/cryogenic tank and systems, the category that includes the three Relevant Products
LNG tanks, LPG tanks and LIN/LOX tanks, grew five-fold, with an increase from $90 million
dollars in 2000 to $456 million in 2004. Jd. CB&I reports that it is “[c]urrently working on 10
LNG projects with total revenue of approximately $2.5 billion.” Jd. at 13. CB&I’s revenues for
specialty and other structures, the category that includes thermal vacuum chambers, tripled from
$54 million in 2000 to $154 million in 2004. Jd. at 7. In order to restore competition to the
relevant markets, New PDM and New CB&I should each reflect a share of the growth in the
Relevant Business since the Acquisition.

13


ROIC ($ in millions)

$1,897

$600

2001 2002 2003 2004 2001 2002 2003 2004

Free Cash Flow ($ in millions)

Cash in Excess of Debt ($ in millions)

$152

$44
$28 $36

2001 2002 2003 2004

2004 2002 2003 2004

2

3


Opportunities
For Growth


@ Plenty of Natural Gas available; location of reserves requires transportation
@ Underdeveloped transport systems are driving natural gas prices

@ Significant reductions in liquefaction and transportation costs of LNG

@ LNG trends are driving growth in infrastructure spending

1

1


Final Order expressly provides that CB&I may propose to divest a package of assets comprising
“New PDM” from which any or all of the assets included in the Relevant Business, other than
assets involving any Relevant Product, may be excluded “if the Acquirer, with the concurrence of
the Monitor Trustee, determines that acquiring any or all of [such assets] is not necessary to
achieve the purposes of this Order.” As an initial step, therefore, Paragraph II.A. requires that
Respondents “retain a Monitor Trustee, acceptable to the Commission.””” The Monitor Trustee is
expected to play an important part in the process by which CB&I proposes to reorganize its
“Relevant Business” for divestiture,”* and should facilitate Commission staff’s evaluation of
Respondents’ compliance with their Order obligations. CB&I will also select the Acquirer in
accordance with Paragraph IV.A. of the Final Order.

Thus, the Final Order prescribes a broad and flexible process for: (1) identifying assets,
including Customer Contracts, that are part of the Relevant Business; (2) reorganizing the
Relevant Business into two independent, viable and competitive entities with approximately equal
shares of the markets for the Relevant Products; and (3) divesting one such entity, including
transferring employees with relevant technical experience and expertise, to an Acquirer. Each step

will be accomplished by CB&I with input from the Monitor Trustee (chosen by CB&I and

an incentive to assemble a package of assets that will be sufficient to create a viable competitor
and readily attract an acceptable buyer” within a reasonable time frame. Op. at 94.

" CB&I has already selected and proposed a Monitor Trustee for Commission
approval. See Application for Approval of Proposed Monitor Trustee and Monitor Trustee
Agreement filed by Respondents Chicago Bridge & Iron Company N.V. and Chicago Bridge &
Iron Company (filed May 26, 2005).

28 For example, the Final Order requires CB&I, inter alia, to submit reports to the
Monitor Trustee identifying “‘all of the assets of the Relevant Business and all Customer
Contracts” (Final Order { IV.E.), and to consult with the Monitor Trustee to “ensure that New
PDM and New CB&I are each assigned Customer Contracts, equitably apportioned among the
types of products relating to the Relevant Business.”(Final Order {| IIIB.)

16