All of ASFI's construction subcontractors suffered setbacks due to the severe weather during January. The mechanical completion of most sections of the pilot plant is now predicted to be March 31, 1979. Engineering work on various projects is detailed. Concerning environmental activities, the Kentucky EPA requires ASFI to propose an SO/sub 2/ emission offset for the pilot plant and has stated there must be an emission reduction in the S-217 oil mist eliminator. They have also requested ASFI to investigate alternate means for controlling particulate emissions from the S-104 baghouse. The H-Coal pilot plant is now required to obtain state water permits since the passage of the Clean Water Act Amendments. Work is continuing on the preparation of computer programs which will be used to predict H-Coal Pilot Plant performance and to analyze pilot plant results. Work continues on the Operations training manuals; at month's end, the training manuals for Sections 200 and 400 are 85% complete. A report specifying analytical laboratory support requirements for the pilot plant is complete.