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January 31, 2006

NASSCO gets ninth T-AKE

NASSCO--National Steel and Shipbuilding Co.--a wholly owned subsidiary of General Dynamics (NYSE: GD), has received a contract option from the U.S. Navy to build an additional ship under the T-AKE program, a new class of combat logistics force ships. The $317 million contract brings the total number of T-AKE ships awarded to NASSCO to nine, and the total contract value to $2.8 billion. Options for three additional T-AKE ships remain available under the existing contract.

The Lewis and Clark Auxiliary Dry Cargo/Ammunition Ships, or T-AKE class, will replace the Navy's aging T-AE and T-AFS fleets starting in 2006 and fulfill a critical role in providing direct support to deployed U.S. Navy ships.

The T-AKEs are 210 meters (689 feet) in length and 32.2 meters (105.6 feet) in beam, with a design draft of 9.12 meters (29.9 feet). The ships can carry almost 7,000 metric tons of dry cargo and ammunition and 23,500 barrels of marine diesel fuel. The T-AKEs are the first modern Navy ships to combine proven international marine technologies such as an integrated electric-drive propulsion system with commercial design features that will minimize their cost of operation and maintenance over their expected 40-year life.

When delivered, the 689-foot, 41,000-ton vessels will join the Military Sealift Command's (MSC) Naval Fleet Auxiliary Force.

The award "continues our commitment to provide combatant commanders with the logistics flexibility they need to rapidly respond to contingencies anywhere in the world," said Dr. Delores M. Etter, assistant secretary of the Navy for research, development & acquisition. "It also provides continued stability in our shipbuilding programs and industrial base that in the long run allows the Navy and industry to more efficiently buy and build these vital wartime assets."

The contract option provides for detail design and construction of the ninth T-AKE ship, performance of system integration, testing and delivery, as well as initial logistics support. The ship is expected to be delivered in 2009.

National Steel and Shipbuilding Company, a General Dynamics company, was awarded a contract for detail design and construction of up to 12 T-AKEs Oct. 18, 2001. The first ship in the class, USNS Lewis and Clark (T-AKE 1), was christened and launched in May 2005.

Fred Harris, president of NASSCO, said, "NASSCO has hired and trained hundreds of employees to build this class of ships, and this award will provide sustained employment for approximately 1,000 skilled NASSCO employees through 2009."

Exercise of this option brings NASSCO's backlog to ten ships, including the nine T-AKEs and the fourth of four double-hull oil tankers being built for BP Shipping Company of Alaska. "Our strong backlog affirms NASSCO's position as a U.S. Navy 'Center of Excellence' for designing and building auxiliary and support ships, and as a leading U.S. builder of commercial ships," Harris said.