announced today that it has received contracts, valued at approximately $3.5 million in total, to install its equipment in two petrochemical processing facilities. Revenue from the two projects will be recognized on a percentage-of-completion basis, and shipment is presently scheduled for the first half of fiscal year 2007, which begins April 1, 2006.

Bill Johnson, President and CEO of Graham, commented, "The bid processes for these contracts were complex and detailed, from both technical and commercial standpoints. Graham is well-known for its engineering expertise, solutions-oriented approach and reliable products, all of which gave us the advantage in winning these contracts. By working closely with our customers, we were not only able to design custom solutions to meet their needs but also provide them with the confidence that our quality products and systems will perform as expected. We continue to capitalize on our engineering strengths and product quality in a strong demand environment to pursue other opportunities on a world-wide basis."

Graham was awarded a steam condensers contract, valued at approximately $2 million, by a major U.S. chemical producer for its U.S. based ethylene production facility. The new condensers will replace the current, failing steam condensers previously supplied by another manufacturer. The customer anticipates that the more reliable Graham units will reduce maintenance time and expense. Shipment is presently scheduled for the quarter ending September 2006.

Ethylene, produced from oil or natural gas, is a building-block chemical used in the production of carpets, apparel, plastics, fibers, tires and numerous other consumer products. Global demand for consumer products continues to rise, increasing demand for ethylene. As a result, Graham is realizing growth in demand for its equipment in both existing petrochemical plant upgrades, as well as in new ethylene production plants being developed, particularly in the Middle East and Asia.

Ammonia and Urea Fertilizer Facility

The second contract was awarded to Graham by Mitsubishi Heavy Industries, a Japanese engineering, procurement and construction contractor. This customer ordered two specialized, stainless steel ejector systems to be installed in the Sohar International Urea and Chemical Industries facility in the Sultanate of Oman, located in the Persian Gulf. One of the world's largest privately-funded plants of its type, the Sohar facility will be a global-scale ammonia and urea fertilizer complex capable of producing up to 1.225 million tons of urea a year. Graham is one of only three vendors world-wide approved by Snamprogetti S.p.A., an Italian engineering company and licensor of the urea production process for this facility. Shipment is planned for the quarter ending June 2006.

ABOUT GRAHAM CORPORATION

With world-renowned engineering expertise in vacuum and heat transfer technology, Graham is a global designer, manufacturer and supplier of ejectors, pumps, condensers, vacuum systems and heat exchangers. Over the past 70 years, Graham has built a reputation for top quality, reliable products and high-standards of customer service. Sold either as components or complete system solutions, the principle markets for Graham's equipment are the petrochemical, oil refining and electric power generation industries, including cogeneration and geothermal plants. Graham equipment can be found in diverse applications, such as metal refining, pulp and paper processing, ship-building, water heating, refrigeration, desalination, food processing, drugs, heating, ventilating and air conditioning.

Graham's reach spans the globe. Its equipment is installed in facilities from North and South America to Europe, Asia, Africa and the Middle East. More information regarding Graham can be found at its website: www.graham-mfg.com

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All forward-looking statements are subject to certain risks, uncertainties and assumptions. These risks and uncertainties, which are more fully described in Graham's filings with the Securities and Exchange Commission, include but are not limited to, Graham's ability to successfully execute the contracts awarded, that the estimated value of the production contracts will be realized, customer preferences and changes in market conditions in the industries in which Graham operates. Should one or more of the risks or uncertainties to which Graham is subject materialize, or should Graham's assumptions prove incorrect, actual results may vary in material aspects from those currently anticipated.