In consideration of favorable information received via pyrolysis laboratory tests at UCC Research and from Coalite Chemicals in England, it is recommended that the pyrolysis system for the subject project be changed to a low pressure/temperature design. A very considerable effort was expended at UCC Research Corporation during the quarter on justification and documentation for the proposed new system. The preliminary design of the proposed unit was essentially completed. Industrial Machine Company was approved as the subcontractor by DOE and the final furnace design was finished. Based on a trip to Coalite Chemicals, tapered reactor tubes will be used initially in the pyrolysis system.