One of the primary concerns in oxy-coal combustion is whether or not conventional coal pyrolysis and char burnout model can be used because of the presence of high CO2, in gas medium around coal particles. This paper attempts to understand the effect of high concentration of CO2 during coal pyrolysis and oxidation by conducting experiments in a drop-tube reactor and a thermogravimetric analyzer (TGA). Two ranks of bituminous coal particles were pyrolyzed in CO2 and Ar atmosphere during the pyrolysis tests and in 21% O-2/79% CO2 and air during combustion tests. The results showed that the differences observed during pyrolysis and combustion tests conducted with and without CO2 can be attributed to the effects of char-CO2 reaction. This result implies that char CO2 reaction should be included in model reactions while modeling coal pyrolysis or char oxidation in oxy-coal combustion. Furthermore, a faster increase in the rate of char burnout during combustion in O-2/CO2 relative to that with air for an lvb coal was due to lower activation energy of C-O-2 and higher activation value of C-CO2 reaction compared to that of an hvCb coal. This result implies that some coals may be more suitable for oxy-coal combustion which can be identified based on the intrinsic activation energy value of char CO2 and char O-2 reactions.