NEW ORLEANS, LOUISIANA -- Avondale Industries, Inc. (NASDAQ/NMS-AVDL) today announced the Navy exercised its option for the construction of an additional Strategic Sealift ship at a value of $211.1 million. After consideration of certain additional components and cost escalations, the contract is expected to total more than $240 million. This represents the fifth ship which Avondale has now been awarded in the Sealift program, a multi-ship initiative intended to support the nation's ability to deploy military materials and equipment quickly throughout the world. Avondale was awarded the contract in 1993 for the initial Sealift ship which contained options for five additional vessels. The remaining option covering the last ship is exercisable over the next year. Avondale was informed of the award by its Congressional delegation including House Appropriations Committee Chairman Bob Livingston (R-LA) and Senator J. Bennett Johnston (D-LA) whose committees funded this ship and U.S. Representative William Jefferson (D-LA) whose House National Security Committee authorized this ship. Other area lawmakers including U. S. Representative Billy Tauzin (RLA) voted for this ship on the House floor. Work on the first Sealift ship is underway, and delivery is scheduled for early 1998. Completion of the fifth ship announced today is set for 2000. Avondale's peak production on the Sealift vessels is anticipated to involve the direct employment by the Company of approximately 3,000 individuals. Albert L. Bossier, Jr. Chairman and Chief Executive Officer, remarked, "The Navy's decision to exercise the option for this Sealift ship increases Avondale's funded backlog to more than $1.2 billion. Avondale has made excellent progress to date on the Sealift program. We believe the Navy's exercise of the option today is a vote of confidence in our employees who are the principal reason for the Company's success." Avondale Industries, Inc., headquartered in metro New Orleans designs, builds and overhauls both military and commercial vessels.