As part of the US Department of Energy's (DOE) Underground Coal Conversion (UCC) program, the Republic of Texas Coal Company conducted engineering, geologic, and financial studies to determine the commercial feasibility of developing deep basin Texas lignite. The lignite would be developed by in situ gasification to produce a synthesis gas consisting of hydrogen and carbon dioxide. The study was conducted during a 2-year period from October 1, 1980 to December 31, 1982. The study was designed to analyze the four major factors that determine commercial feasibility of industrial processes: (1) market potential, (2) finance, (3) site selection and characterization, and (4) process and facility design engineering. The results of the study indicated that such a facility was both technically and economically feasible if appropriate financing could be found. A preferred site meeting the geologic, technical, and environmental parameters for an efficient in situ gasification facility was selected in east Texas in Panola County, 5 miles west of Carthage, Texas. It was also discovered that the Carthage site was in the proximity of a number of oil reservoirs that were suitable for EOR by CO/sub 2/ flooding. The engineering and design analysis, which included an in situ field and a surface cleanup and purification facility, incorporated system design descriptions for nine major project systems: (1) underground coal gasification (by reverse combustion linkage), (2) underground coal gasification (by directional drilling), (3) air separation system, (4) sulfur recovery system, (5) CO-shift system, (6) acid gas removal system, (7) raw gas cooling and scrubbing system, (8) gas compression system, and (9) methanol synthesis system. Directional drilling was determined to be the optimal method for in situ gasification in the field. 23 figs., 15 tabs.