MHI has been formally awarded a contract by AES Corporation, a leading global power company based in the U.S., for a gas turbine combined-cycle power plant to be constructed in Cartagena, southeast Spain. The order which MHI and Mitsubishi Corporation, in cooperation with Nichimen Corporation of Japan, had been awarded has now become effective upon recent completion of financing arrangements by AES, and MHI will proceed to bring
plant construction under way. Plant operation is slated to commence in November 2005.

With total power generation capacity of 1,200 MW, the plant will be among Spain's largest in scale. MHI will supply three gas turbines, three steam turbines and three heat recovery steam generators (HRSG). Mitsubishi Electric Corporation will manufacture three generators. Provision of other auxiliary equipment as well as installation and construction work will be performed by the Spanish engineering firm INITEC Energia.

MHI also signed a long-term service agreement with AES under which it will undertake maintenance work on the gas turbines for a maximum duration of eight years after the plant goes on-stream.

AES is a leading global IPP (independent power producer) that operates more than 150 power generation businesses in 28 countries. In Europe, the number of power generation businesses operated by foreign companies is increasing in line with liberalization of the power industry. The Cartagena project is drawing attention as the first undertaking of its kind in Spain to be conducted by a non-European company.

MHI has received two other European orders for its gas turbines recently: first in August 2002 from the Spanish electricity company ENDESA for one unit, and another this June from Electrabel SA, a Belgian electricity producer, for two units. MHI has long ties with Spain's power generation industry tracing back to 1972, to the first delivery to ENDESA of power generation equipment for its Compostilla plant. Through the years core equipment, including steam turbines and boilers, has been supplied in large numbers, and presently power generation equipment provided by MHI generates an estimated 15% of all power produced in Spain.