Extensive laboratory and pilot plant experimental work on the Solvent Refined Coal process by Gulf Oil Corporation over the past 18 years, sponsored by the Fossil Fuel Division of the United States Department of Energy and its predecessor agencies, has led to the development of an improved version of the process known as SRC-II. This work has shown considerable promise in recent years and plans are now being made to demonstrate the SRC-II process with commercial size equipment in a 6000 ton/day (5440 t/day) plant to be located near Morgantown, West Virginia. On the basis of recent economic studies, the products (both liquid and gas) from a future large-scale commercial plant are expected to have an overall selling price of $4.25-4.75/GJ (first quarter 1980 basis). The major product of the primary process is distillate fuel oil of less than 0.3% sulphur for use largely as a non-polluting fuel for generating electrical power and steam, especially in the east where utilities and industry are currently using petroleum products. In such applications, SRC-II fuel oil is expected to be competitive with petroleum-derived fuels within the next decade. During this period, SRC-II fuel oil should be economically attractive compared with coal combustion with flue gas desulphurization in electric utility and industrial boilers, particularly in the major metropolitan areas. Naphtha produced by the SRC-II process can be upgraded to a high-octane unleaded gasoline to supplement petroleum-derived supplies. Significant quantities of pipeline gas are also produced at a cost that should be competitive with s.n.g. from direct coal gasification. Light hydrocarbons (ethane, propane) from the process may be effectively converted to ethylene. In addition, certain fractions of the fuel oil might also be used in medium-speed diesel engines and automotive gas turbines. For many of these applications, the fuel oil and other products from the SRC-II process would displace high-quality petroleum fractions, which could then be used for production of diesel fuels, jet fuels, home heating oil and gasoline by conventional refinery processes.