Work continued this quarter on the design and procurement of equipment to construct the wet-carbonization process research unit(PRU). The PRU is being designed to process about 100 lb/h of as-received coal. Nine batch wet-carbonization tests were conducted this quarter. Tests have now been conducted with all four coals specified in the approved test plan. The four coals are lignites from the Indianhead and Center mines, North Dakota, subbituminous coal from the Rosebud mine, Montana, and lignite from the South Hallsville mine near Martin Lake, Texas. The operating conditions for the tests were temperatures, pressures, and residence times in the range of 400/sup 0/ to 650/sup 0/F, 250 to 3300 psia, and 0 to 60 minutes, respectively. Results to date show that overall component conversions for the two North Dakota lignites are similar for the tests conducted at comparable conditions. The Texas lignite is less reactive and the Montana Rosebud subbituminous coal to significantly less reactive than the North Dakota lignites. Handling characterization tests were conducted with raw and wet-carbonized coals. These tests include drop-shatter tests, bulk and particle density measurements, and particle shrinkage determinations. Particle-size reduction due to drop-shatter testing of wet-carbonized coal was greater than that of the corresponding feed coal and increased with wet-carbonization severity. However, once air-dried, the raw coal decrepitated (crumbled) much more readily than the air-dried wet-carbonized coal. Bulk and particle densities of the wet-carbonized coal products decreased with increasing temperature and residence time. Anaerobic biogasification potential assays were continued this quarter to determine the biodegradability of liquid product samples from the batch wet-carbonization tests. 16 figs., 8 tabs.