ENCOAL Corporation, a wholly-owned subsidiary of SMC Mining Company (formerly Shell Mining Company, now owned by Zeigler Coal Holding Company), has completed the construction and start-up of a mild gasification demonstration plant at Triton Coal Company`s Buckskin Mine near Gillette, Wyoming. The process, using Liquids From Coal (LFC) technology developed by SMC and SGI International, utilizes low-sulfur Powder River Basin coal to produce two new fuels, Process Derived Fuel (PDF) and Coal Derived Liquids (CDL). The LFC technology uses a mild pyrolysis or mild gasification process which involves heating the coal under carefully controlled conditions. The process causes chemical changes in the feed coal in contrast to conventional drying, which leads only to physical changes. Wet subbituminous coal contains considerable water, and conventional drying processes physically remove some of this moisture, causing the heating value to increase. The deeper the coal is physically dried, the higher the heating value and the more the pore structure permanently collapses, preventing resorption of moisture. However, deeply dried Powder River Basin coals exhibit significant stability problems when dried by conventional thermal processes. The LFC process overcomes these stability problems by thermally altering the solid to create PDF and CDL. Several of the major objectives of the ENCOAL Project have now been achieved. The LFC Technology has been essentially demonstrated. Significant quantities of specification CDL have been produced from Buckskin coal. Plant operation in a production mode with respectable availability (approaching 90%) has been demonstrated.