This report covers progress on the project, "Support Research on Chemical, Mechanical, and Environmental Factors in Underground Coal Gasification", Contract No. DE-AS20-81LC10713, at the University of Texas at Austin during December, 1980 to March, 1981. The staffing of the project included faculty members in the Department of Chemical Engineering, Petroleum Engineering, and microbiology at UT-Austin and also Dr. Michael Humenick of the Department of Civil Engineering at the University of Wyoming. A total of nine graduate students are involved in various tasks form the research contract. Section 2.0 reports recent results in the chemical engineering area, 3.0 covers environmental studies, and 4. 0 details petroleum engineering research.