KBR Announces New Business Units

HOUSTON - September 06, 2007 - KBR (NYSE:KBR) today announced the creation of three new business units; Technology, Downstream and Services. Today's announcement follows the recent appointments of John Rose as President, Upstream and Bruce Stanski as President Government and Infrastructure. The creation of these business units, in addition to the previously announced Upstream and Government and Infrastructure units, provides an organizational framework which best aligns KBR's operations organization with the company's current and mid-term market opportunities. This new structure is designed to fully maximize the opportunities ahead of KBR in the coming years.

To lead these new business units, the following appointments have been announced.

Tim Challand, currently Senior VP of Downstream, has been appointed President, Technology. KBR Technology will be charged with overseeing the company's portfolio of intellectual property assets. This unit will also seek to profitably grow this sector of our business through the acquisition and/or development of new technologies and applications across the entire hydrocarbon value chain.

John Quinn, currently Chief Executive Officer for M. W. Kellogg Ltd, KBR's 55% owned operation in Greenford, United Kingdom, has been appointed President, Downstream. KBR Downstream will oversee the business development and project execution responsibilities for KBR's projects in the Downstream hydrocarbon market. KBR Downstream will work closely with KBR Technology to exploit KBR's complimentary strengths and resources in technology and EPC / EPCm work. John will also continue in his present capacity as M.W. Kellogg's Chief Executive Officer until a successor can be identified.

David Zimmerman, currently Senior VP Engineering, Procurement, Construction and Services, has been appointed President, Services. KBR Services will encompass KBR's industrial and maintenance services businesses, North American construction and Canadian fabrication operations. This business unit will also lead a study to examine KBR's possible re-entry into the offshore marine fabrication and international operations and maintenance services businesses. David will also continue in his present capacity until a successor can be identified.

KBR is a global engineering, construction and services company supporting the energy, petrochemicals, government services and civil infrastructure sectors. The company offers a wide range of services through its Energy and Chemicals, Government and Infrastructure, and Ventures business segments. For more information, visit www.kbr.com.

CONTACT:
KBR, Houston
Director, Communications
Heather Browne, 713-753-3775
heather.browne@kbr.com
or
Director, Investor Relations
Rob Kukla, Jr., 713-753-5082
investors@kbr.com