This report summarizes the progress made on the development of the KENTORT II process during the period of January 1, 1988 through March 31, 1988. The purpose of this program is to develop on a small scale a process to improve efficiency, process economics, and resolve environmental problems involved in the utilization of eastern US oil shale as an energy source and chemical feedstock. The process includes fluidized bed sections of pyrolysis, gasification, and combustion with combined solid/gas heat transfer among the stages. A 1.5-inch diameter bench-scale fluidized bed reactor was used to investigate the combustion behavior of raw, pyrolyzed, and pyrolyzed/gasified Eastern oil shale materials. Agglomeration of raw and pyrolyzed shales caused blockage of the product withdrawal lines and prevented extended operation of the reactor. Analysis of the agglomerates and resolution of this difficulty is pending. It was discovered, however, that the pyrolyzed/gasified shale char did not form agglomerates allowing smooth operation of the reactor. Consequently, a test matrix involving pyrolyzed/gasified shale char was initiated. Runs investigating carbon combustion at 700, 800, and 900/degree/C and 30 minutes mean solid residence time (MSRT) were completed, and under all conditions over 90% of the carbon was removed from the feedstock.