Construction of the process research unit (PRU) was completed with the successful modification and shakedown testing of the high-pressure steam boiler. Following an initial shakedown test of the PRU, four wet carbonization tests were conducted: a test (86-PRU-1) to determine the wet carbonization characteristics of (-1 1/2 inch) North Dakota Indianhead lignite, a replicate test (86PRU-2) to determine reproducibility of data, a test (86PRU-3) to determine the effect of residence time, and a test (86PRU-4) to determine the effect of partial wet oxidation using air feed to the reactor. The PRU and ancillary equipment operated smoothly, and system temperature and pressure controls operated well. The operating conditions for the four tests were a residence time of 0.3 to 1.1 hours and a temperature of about 550F. Air was used in the fourth test as a means of providing a portion of the required process heat. Product solid, liquid, and gas samples were taken for analyses. Two successful tests were conducted in the free-fall devolatilization reactor with raw Texas lignite and Montana subbituminous coals. These tests were conducted at a temperature of 1300F and a pressure of 500 psig with a steam-hydrogen mixture (50 mole percent hydrogen). About 150 grams of coal were fed during the 60-minute duration of the tests. The product solid, liquid, and gas samples from the tests are being analyzed. Anaerobic digestion tests continued with filtered product water from the batch wet carbonization unit and the PRU. The objective of these tests is to determine the preferred reactor configuration and operating conditions for producing methane from and reducing the chemical oxygen demand of the wet carbonization product water.