AbstractIn this study, a nonhydrogenative process for partial upgrading of heavy oil was evaluated in a semi‐continuous laboratory scale unit for producing a low viscosity oil which could be pipelined easily. The process was conducted at atmospheric pressure and over a temperature range of 400 to 470°C. Gas production was negligibly small (1‐2 wt. % of the feed) and there was virtually no coking of reactor except at high coal concentrations (>9.1 wt. %) and high reactor temperatures (470°C). The particulate content of the liquid product which contained unreacted coal, ash and coke (defined as toluene‐insolubles) was less than 5 wt.% in the majority of the cases. In the presence of coal, iron oxide mixed with coal. and iron oxide alone, maximum reductions in viscosity were: from 1540 to 248 mPa.s, from 1540 to 192 mPa.s, and from 1540 to 80 mPa.s, respectively. A moderate improvement in API gravity (from 13.0 to 18.2) was obtained using 1 wt. % iron oxide additive at 470°C. However, apparent pitch (resid) conversion were of the order of only 20