WÄRTSILÄ AND HYUNDAI HEAVY INDUSTRIES TO SET UP JOINT VENTURE FOR DUAL-FUEL ENGINES FOR LNG-CARRIER

Wärtsilä Corporation  STOCK EXCHANGE RELEASE  23 January 2007 at
8.45 am

WÄRTSILÄ AND HYUNDAI HEAVY INDUSTRIES TO SET UP JOINT VENTURE FOR
DUAL-FUEL ENGINES FOR LNG-CARRIER MARKET

Wärtsilä and Hyundai Heavy Industries Co. Ltd (HHI) have signed an
agreement to set up a 50/50-owned joint venture in Korea to
manufacture dual-fuel engines for LNG (liquefied natural gas)
carriers.  The total investment in the company will be EUR 58
million, Wärtsilä´s share being EUR 29 million. The name of the
company will be Wärtsilä Hyundai Engine Company Ltd and the
intended location is South Korea.

The technology shift towards dual-fuel machinery in LNG carriers
has significantly increased demand for Wärtsilä´s dual-fuel
engines. The main market is in Korea. Demand in the market is
forecast to continue growing in pace with the increasing demand
for natural gas. To date Wärtsilä has received orders for 206
Wärtsilä 50DF dual-fuel engines for 52 LNG carriers, most of which
will be built in Korea. The global market share of Korea in the
LNG shipbuilding market currently exceeds 70%.

“This joint venture will accentuate the strengths of two companies
that are already partners; the vast know-how of the world´s
biggest shipbuilder with the expertise and experience of a global
leader in engine design and ship machinery. The joint venture
marks a major step in Wärtsilä´s strategy to accelerate growth in
the continuously expanding Asian market,” said Ole Johansson,
President and CEO of Wärtsilä when signing the contract today in
Korea with Ph.D. Min, Keh-Sik, Vice Chairman and CEO of HHI.

The joint venture will manufacture Wärtsilä 50DF dual-fuel engines
for the Korean, Japanese, Chinese and Taiwanese shipbuilding
markets. Focusing on assembly and testing of the engines, the
joint venture is scheduled to deliver its first engine in the
second half of 2008. The total capacity of the factory will be in
the magnitude of 100 engines a year. Wärtsilä´s sales organization
will continue to serve the Japanese, Chinese and Taiwanese markets
whereas the Korean market will be served by the joint venture
company directly.

The joint venture will utilize the established global service
networks of Wärtsilä and HHI to take complete care of customers’
ship machinery needs at every stage in about 70 countries.

The Trieste factory in Italy will continue to manufacture Wärtsilä
50DF dual-fuel engines for the marine markets outside East Asia
and the growing worldwide power plant market.

Wärtsilä and Hyundai Heavy Industries have a long history of close
co-operation. Wärtsilä and HHI have a licence agreement to produce
low-speed engines. The latest

The deal is subject to the approvals of the relevant regulatory
authorities.

For more information, please call

Mr Jaakko Eskola, Group Vice President, Wärtsilä tel +358 10 7095
634

Mr O.S. Kwon, Executive Vice President, Hyundai Heavy Industries,
tel +82 52 202 7028

About Hyundai Heavy Industries

Hyundai Heavy Industries Co., Ltd (HHI) is one of the world’s
leading industry companies, with 26,000 employees and net sales of
USD 10.2 billion in the fiscal year 2005. HHI is also the world´s
number one shipbuilder and also the world’s largest builder of two
stroke diesel engines for ship propulsion and power generation.

About Wärtsilä Corporation
Wärtsilä enhances the business of its customers by providing them
with complete lifecycle power solutions. When creating better and
environmentally compatible technologies, Wärtsilä focuses on the
marine and energy markets with products and solutions as well as
services. Through innovative products and services, Wärtsilä sets
out to be the most valued business partner of all its customers.
This is achieved by the dedication of more than 14,000
professionals manning 130 Wärtsilä locations in close to 70
countries around the world. In 2005 Wärtsilä generated net sales
totalling EUR 2.6 billion.

www.wartsila.com