The first phase of the DOE project for gasification of steeply dipping coal beds consisted of site selection activities, a concept feasibility study and program planning. A test site was selected at North Knobs near Rawlins, Wyoming. This site has the best potential for a successful first UCG-SDB test. Analysis of the concept suggests air emission and aquifer degradation as possible areas of environmental impact. A monitoring plan has been established to determine the environmental effect of the tests. The detailed technical approach for the project is being developed based on present DOE field experiences and previous Russian work. Emphasis will be on resolving technical areas where the DOE experience is not transferrable (i.e., process modeling, well configuration, and installation). Using a proprietary cost estimating model, the parameters of greatest sensitivity were product gas quality, gas leakage, and yield of product gas per unit volume of injection air. A facility and equipment design was established for cost projection and to serve as a basis for detailed design work during the second phase. A cost analysis of the project indicated that the original costs projections still hold but that the spending curve will require revision.