The overall objective of this project is to develop the IGT Mild-Gasification (MILDGAS) process for near-term commercialization. The specific objectives of the program are to: design, construct, and operate a 24-tons/day adiabatic process development unit (PDU) to obtain process performance data suitable for further design scaleup; obtain large batches of coal-derived co-products for industrial evaluation; prepare a detailed design of a demonstration unit; and develop technical and economic plans for commercialization of the MILDGAS Process. The MILDGAS process is a continuous closed system for producing liquid and solid (char) co-products at mild operating conditions up to 50 psig and 1300 F. It is capable of processing a wide range of both eastern caking and western noncaking coals. The 1 ton/hr PDU facility that is to be constructed is comprised of a 2.5-ft ID adiabatic gasifier for the production of gases, coal liquids, and char; a thermal cracker for upgrading of the coal liquids; a three-stage condensation train to condense and store the liquid; a three-stage condensation train to condense and store the liquid products; and coal feeding and char handling equipment. The facility will also incorporate support equipment for environmentally acceptable disposal of process waste. This quarter the authors continued to assist DOE in the preparation of the Environmental Assessment documentation for the NEPA application. Also this quarter, they obtain permission from DOE to pursue the permitting needed to construct the PDU and they have started the preparation of the application document for the Illinois EPA Air Emissions permit.