The Rawlins UCG Demonstration Project is progressing in Phase 1 with the majority of the emphasis on facility design, site characterization and the environmental work. The site characterization field work was completed in February with the interpretation, analysis, and final report to be completed towards the end of Phase 1. The facility design effort continues and is well beyond the 40% level. It is anticipated that all permits will be applied for in Phase 1 and most of them will be granted by the end of Phase 1. Significant changes in the scope of the project were requested during this period and are under review. A request was made to eliminate urea production, make ammonia the primary product, and add cogeneration. An extension of Phase 1 and rescheduling of project deliverables were requested to accommodate the needs for private financing. The obtaining of the private financing continues to be a major activity in the project. All of the financing must be in place before the continuation application for DOE funding to Phase 2 will be submitted.