The groundwork was laid for both the membrane materials development and the construction of the required facilities for testing the membrane reliability and performance. It has resulted in the construction of a single tube and multi-tube combustion test facility. Design for Six Sigma (DFSS) principles were applied to the membrane material selection process. The required ceramic powders were ordered and will be evaluated in 2005. Design of experiment techniques (fuel gas mixture design) were applied to the membrane performance evaluation process. The first results indicate that the oxygen flux of the membrane is significantly higher when the porous support is exposed to the fuel gas mixture instead of air. Failures of the oxygen transport membrane tube did not occur during the reporting period which is supporting evidence that our emphasis on design for robustness is yielding the desired result. All work on the project was performed in a safe manner as proven by zero recordable injuries or lost work days.