Mr. Adam Borgatti reports

AECON ANNOUNCES MUTUALLY AGREEABLE GLOBAL SETTLEMENT AGREEMENT OVER COASTAL GASLINK PIPELINE PROJECT DISPUTE AND INTERIM UPDATE ON REMAINING LEGACY PROJECTS

Aecon Group Inc. has noted that SA Energy Group (a general partnership of Aecon Construction Group Inc. and Robert B. Somerville Co. Ltd.) and Coastal GasLink Pipeline LP, by its general partner Coastal GasLink Pipeline Ltd., have reached an amicable and mutually agreeable global settlement to resolve their dispute fully and finally over the construction of sections 3 and 4 of the Coastal GasLink Pipeline project in British Columbia.

The settlement agreement is not an admission of liability by either party and the parties have mutually released their respective claims in the arbitration, thereby avoiding the expense, burden and uncertainty associated with arbitration.

The terms of the settlement agreement are expected to result in no cash impacts to Aecon. From an accounting perspective, Aecon expects an approximately $127-million, non-recurring charge relating to the construction of sections 3 and 4 of the Coastal GasLink Pipeline project to be reflected in Aecon's financial results for the second quarter of 2024.

Further, as part of its continuing review of critical accounting estimates in respect of the remaining three large fixed price legacy projects now nearing completion and being performed by joint ventures in which Aecon is a participant, Aecon currently anticipates additional charges of approximately $110-million in aggregate to be reflected in its second quarter 2024 results. Additional information, including risks related to the four legacy projects is included in sections 5 -- Recent Developments and 10.2 -- Contingencies and in Section 13 -- Risk Factors in Aecon's management's discussion and analysis for the quarter ended March 31, 2024, and for the year ended Dec. 31, 2023, respectively.

"The Coastal GasLink settlement allows Aecon to close the chapter on one of the most technically and financially challenging projects in its history, and represents continued progress in reducing the uncertainty associated with Aecon's four legacy projects," said Jean-Louis Servranckx, president and chief executive officer, Aecon Group. "We are proud of our team and thank them for delivering this project safely and with incredible resiliency through to completion."

Mr. Servranckx further added, "The additional impacts from the remaining legacy projects anticipated in the second quarter reflect the ongoing progress towards driving these remaining legacy projects to completion."

Further details respecting the settlement and the review of the remaining three large fixed price legacy projects noted herein will be provided as part of Aecon's second quarter 2024 financial results to be released on Wednesday, July 24, 2024, after market close, and live webcast and conference call scheduled for 9 a.m. Eastern Time on Thursday, July 25, 2024.

About Aecon Group Inc.

Aecon Group is a North American construction and infrastructure development company with global experience. Aecon delivers integrated solutions to private and public sector clients through its construction segment in the civil, urban transportation, nuclear, utility and industrial sectors, and provides project development, financing, investment, management, and operations and maintenance services through its concessions segment.

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