U.S. VIRGIN ISLANDS AWARDS FIRST-EVER DESIGN-BUILD-OPERATE CONTRACT

Christie Kaluza
Veolia Water North America
281.985.5481
Christie.Kaluza@veoliawaterna.com

Stella M. Saunders
Government of the U.S. Virgin Islands
340.773.1290
SMS0429@yahoo.com

Water Partnership with Veolia Water North America to Preserve Pristine Island Waters

HOUSTON , April 7, 2004 – The Government of the U.S. Virgin Islands has awarded its first-ever design-build-operate contract to a private-sector firm for the development of a comprehensive, long-term solution to the wastewater management needs of the St. Thomas and St. Croix islands.

VWNA Caribbean , LLC., a wholly-owned subsidiary of Veolia Water North America Operating Services, Inc., (Veolia Water) has won a $123 million, 20-year contract to design, construct and operate two new 4-million-gallon-per-day wastewater treatment facilities. One facility, the Anguilla wastewater treatment plant, will be located on St. Croix . The second facility, the St. Thomas Red Point wastewater treatment plant, will be located on St. Thomas and includes the decommissioning of existing lagoons on that site. A five-year renewal option for continued operations is also part of the contract.

“Critical in our decision was that we wanted the highest possible international standards for these two projects,” said Commissioner Wayne D. Callwood of the Department of Public Works. “Veolia Water provides that standard.”

Through treatment of the waste stream, Veolia Water will help the territory meet the requirements of a 1996 agreement with the U.S. Environmental Protection Agency concerning ocean discharge.

“This truly is some of the most pristine water in the world,” said Joe Ortiz, regional vice president, Veolia Water North America. “Our objective is to keep this water at its unspoiled level by treating the waste stream using our proven technology and years of operating expertise.”

Veolia Water expects the design phase of the contract to last 10 months, followed by a construction phase lasting approximately 24 months. Both new wastewater plants should be fully operational in two-and-a-half years.

In addition to working with the U.S. Virgin Islands on the two new facilities, Veolia Water has been working with island officials on an emergency basis since early February to help repair St. Croix 's collection system and pump stations. “We quickly mobilized a team of experts and moved in to help. Immediate access to technology and expertise is just one of the many benefits local governments realize when partnering with the private sector for water services,” added Ortiz.

Headquartered in Houston , Veolia Water North America (formerly known as USFilter Operating Services) operates approximately 400 municipal and industrial water and wastewater treatment facilities in the United States and Canada . In addition to designing, building and operating water and wastewater treatment facilities for municipalities, the company also provides services to a wide of range of industrial markets, including automotive, refining, chemical, steel and oil and gas, to name a few.

Company Information:

Veolia Water North America is the leading provider of comprehensive water and wastewater services to municipal and industrial customers, providing services to approximately 14 million people in more than 600 communities. The company is part of Veolia Water, the No. 1 water company in the world serving more than 110 million customers. Veolia Water is the Water Division of Veolia Environment (NYSE:VE and Paris Bourse: VIE), the largest environmental services company in the world with more than 310,000 employees in about 80 countries and annual revenues of more than $28.6 billion. Visit the company's web sites at www.veoliawaterna.com.

Important Disclaimer: Veolia Environnement is a corporation listed on the NYSE and Euronext Paris. This press release contains “forward-looking statements” within the meaning of the provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations or beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements, including the risks described in the documents Veolia Environnement has filed with the U.S. Securities and Exchange Commission. Veolia Environnement does not undertake, nor does it have, any obligation to provide updates or to revise any forward-looking statements. Investors and security holders may obtain a free copy of documents filed by Veolia Environnement with the U.S. Securities and Exchange Commission from Veolia Environnement.

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