Reducing enzymes can be chemically modified by activated polyethylene glycol or various substituted aromatic organic reagents so that they can be effectively dissolved and used in organic liquids while maintaining catalytic activity. Such biocatalysts are being investigated for use in organic solvents to enhance the conversion of coal to liquids in a hydrogen atmosphere at mild operating conditions. Most of the recent work has been with a hydrogenase isolated from Proteus vulgaris, cytochrome c, and a hydrogenase from the hyperthermophile Pyrococcus furiosus. Chemical modification has been primarily by methoxypolyethylene glycol p-nitrophenyl carbonate and dinitrofluorobenzene. Solvents used have included pyridine; benzene; toluene; and a mixture of tetralin, 2-methylnaphthalene, and p-cresol that simulates a process-derived solvent. Molecular hydrogen and other reducing agents are being evaluated with reaction temperatures in the range of 30-80 degrees C. It has been shown that the modified enzymes do enhance the conversion of coal to liquids with over 40% of bituminous coal having been converted in a small fluidized-bed bioreactor during a 24 h period. Work with model compounds such as 1-C4-(2-phenylethyl)benzyl]naphthalene suggests that part of the conversion process may be due to splitting at methyl or ethyl bridging, and there is some indication that there may be additional saturation of the ring structures.