Letter of Claim in Respect of Ropax Contract

Singapore, 13 June 2011 - Further to the announcements made by ST Engineering on 19 March 2011 and 24 March 2011, ST Engineering would like to update its shareholders that ST Marine, the marine arm of ST Engineering, has today been issued a letter of claim dated 10 June 2011 (Claim) by the lawyers of Louis Dreyfus Armateurs (LDA) in respect of the shipbuilding contract for the Roll-on/Roll-off Passenger ferry (Ropax Contract) contracted in July 2007 for a contract price (inclusive of variation orders) of approximately S$179m.

The Claim states that LDA is claiming for both liquidated and unliquidated damages resulting from ST Marine's purported breach of the Ropax Contract. As set out in the Claim, LDA is claiming a sum of S$4.8m in respect of liquidated damages for delay in delivery and an aggregate sum indicated as approximately Euro 33.03m for unliquidated damages arising from ST Marine's purported breach.

As stated in the previous announcement on 24 March 2011, ST Marine is of the view that LDA's purported termination of the Ropax Contract is a breach and ST Marine itself has terminated the Ropax Contract on the basis of LDA's breach and accordingly has reserved all its rights in the matter.

ST Marine is taking legal advice on the Claim and intends to dispute the Claim. As announced previously, ST Marine's position is that if liable, its total liability under the terms of the Ropax Contract is capped at 10% of the contract price and on that basis no material impact is expected on the consolidated net tangible assets per share and earnings per share of ST Engineering for the current financial year.

ST Marine (Singapore Technologies Marine Ltd), the marine arm of ST Engineering, provides turnkey building, repair and conversion services for a wide spectrum of naval and commercial vessels. In shipbuilding, it has the proven capabilities to provide turnkey solutions from concept definition to detailed design, construction, on-board system installation and integration, testing, commissioning to through-life support. It has also established a track record in providing high engineering content shiprepair and ship conversion services for a worldwide clientele. ST Marine also provides a suite of sustainable environmental engineering solutions via its environmental engineering subsidiaries led by STSE Engineering Services Pte Ltd (STSE). Please visit www.stengg.com.

ST Engineering (Singapore Technologies Engineering Ltd) is an integrated engineering group providing solutions and services in the aerospace, electronics, land systems and marine sectors. Headquartered in Singapore, the Group reported revenues of $5.98b in FY2010 and ranks among the largest companies listed on the Singapore Exchange. It is a component stock of the FTSE Straits Times Index, FTSE ASEAN 40 Index, MSCI Singapore and other indices, ST Engineering has more than 22,000 employees worldwide, and over 100 subsidiaries and associated companies in 24 countries and 45 cities. Please visit www.stengg.com.

Singapore Technologies Engineering Ltd. press release