KBR Acquires Wabi Development Corporation

Houston, Texas - October 06, 2008 - KBR (NYSE:KBR) today announced that it has acquired Wabi Development Corporation (Wabi) for approximately US$19.5 million. Wabi, a privately held Ontario, Canada-based general contractor, services the energy, forestry and mining industries. The company will be integrated into KBR's Services Business Unit. Wabi currently employs over 350 people, providing maintenance, fabrication, construction and construction management services to a variety of clients in Canada and Mexico and generated revenue of approximately C$124 million for its fiscal year ended July 31, 2007.

"The Wabi acquisition demonstrates KBR's commitment to diversifying and expanding our capability across markets and geographic regions," said William P. Utt, KBR Chairman, President and CEO. "Additionally, the integration of Wabi into KBR's Services business will provide additional growth opportunities for our heavy hydrocarbon, forestry, oil sand, general industrial and maintenance services business."

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 Downstream, Government and Infrastructure, Services, Technology, Upstream and Ventures business segments. For more information, visit www.kbr.com.

KBR, Houston
Director, Communications
Heather Browne, 713-753-3775
Director, Investor Relations
Rob Kukla, Jr., 713-753-5082