The Babcock & Wilcox Company (B&W) (NYSE:BWC) announced today that it has received a $5 million grant from the Virginia Tobacco Indemnification and Community Revitalization Commission (TICRC) for its Integrated System Test (IST) facility in Bedford County, Va. The facility is located at the Center for Advanced Engineering and Research (CAER), currently being constructed at the New London Business & Technology Center.

The grant supports further development of the B&W mPower™ reactor that represents a new generation of smaller, scalable nuclear power plants on track to be deployed by 2020. Babcock & Wilcox Nuclear Energy, Inc. (B&W NE) and Bechtel Power Corporation have formed a joint company, Generation mPower LLC, to design, license and build the next generation of nuclear power plants based on B&W mPower reactor technology.

The test program will collect data to verify the reactor design and safety performance in support of B&W's licensing activities with the Nuclear Regulatory Commission. B&W anticipates the facility will begin testing activities later this summer.

"B&W is pleased to receive continued support from the Virginia Tobacco Commission and CAER as we establish a world-class testing facility in Bedford County," said Christofer Mowry, B&W NE President. "This facility will play a vitally important role in testing, licensing activities and demonstrating the maturity of the design for the B&W mPower reactor, while strengthening Central Virginia's reputation as a premier region for innovation in nuclear technology."

"The Tobacco Commission has worked to make Central Virginia one of the nation's top places for technology and technology manufacturing firms to locate and to grow," noted Delegate Kathy J. Byron (R-Campbell), who serves as Chairman of the House Science and Technology Committee and is a member of the TICRC. "B&W's investment is further confirmation that our efforts are paying off, and that opportunities for the people of our region are on course for expansion."

"We are extremely pleased with this award," added Bob Bailey, Executive Director of the CAER. "Our research facility is designed to support innovation in our region's industries and strengthen the role of science and technology in our economy. The Tobacco Commission's continued support of this project reinforces this mission and will make this region even stronger."

This is the second grant the Virginia TICRC has awarded for design and construction of B&W's IST facility. In July 2010, B&W announced a $2.4 million grant from the commission to support construction. The additional $5 million is designated for process equipment to support operation of a scaled prototype of the B&W mPower reactor. All of the technical features of B&W's mPower reactor are included in the IST, although the source of energy is electricity rather than nuclear.

About B&W

Headquartered in Charlotte, N.C., The Babcock & Wilcox Company is a leader in clean energy technology and services, primarily for the nuclear, fossil and renewable power markets, as well as a premier advanced technology and mission critical defense contractor. B&W has locations worldwide and employs approximately 12,000 people, in addition to approximately 10,000 joint venture employees. Learn more at www.babcock.com.

About the Virginia Tobacco Indemnification and Community Revitalization Commission

The Tobacco Indemnification and Community Revitalization Commission is a 31-member body created by the 1999 General Assembly to promote economic growth and development in tobacco-dependent communities, using proceeds of the national tobacco settlement. To date, the Commission has awarded 1,365 grants totaling more than $763.7 million across the tobacco region of the Commonwealth, and has made available nearly $268 million in indemnification payments to tobacco growers and quota holders. For information on the Commission's history, mission, funding programs and recent grant awards, visit our website at www.tic.virginia.gov or call toll free 877-807-1086.

Cautionary Statement Regarding Forward Looking Statements

B&W cautions that this release contains forward-looking statements, including statements relating to the timing of the testing activities and deployment of the B&W mPower reactor. These forward-looking statements involve a number of risks and uncertainties, including, among other things, delays or other difficulties obtaining regulatory approval and adverse changes in the nuclear energy industry. If one or more of these or other risks materialize, actual results may vary materially from those expected. For a more complete discussion of these and other risk factors, please see B&W's filings with the Securities and Exchange Commission, including its annual report on Form 10-K for the year ended December 31, 2010. B&W cautions not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and undertakes no obligation to update or revise any forward-looking statement, except to the extent required by applicable law.