UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    Form 10-Q



[X]  Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934
     For the period ended June 30, 2001

                                       or

[ ]  Transition Report Pursuant to Section 13 or 15(d) of the Securities
     Exchange Act of 1934

                         Commission File Number 1-12396


                                THE BEARD COMPANY
             (Exact name of registrant as specified in its charter)


          Oklahoma                                          73-0970298
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)


                           Enterprise Plaza, Suite 320
                              5600 North May Avenue
                          Oklahoma City, Oklahoma 73112
               (Address of principal executive offices) (Zip Code)


Registrant's telephone number, including area code:  (405) 842-2333

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]

     Indicate the number of shares outstanding of each of the registrant's
classes of common stock as of July 31, 2001.


                   Common Stock $.001333 par value - 1,828,845
<PAGE>

                                THE BEARD COMPANY

                                      INDEX

PART I. FINANCIAL INFORMATION
                                                                        Page
                                                                        ----
Item 1.   Financial Statements............................................3

    Balance Sheets - June 30, 2001 (Unaudited) and
       December 31, 2000..................................................3

    Statements of Operations - Three Months and Six Months
       ended June 30, 2001 and 2000 (Unaudited)...........................4

    Statements of Shareholders' Equity - Year ended December 31, 2000
       and Six Months ended June 30, 2001 (Unaudited).....................5

    Statements of Cash Flows - Six Months ended
       June 30, 2001 and 2000 (Unaudited).................................6

    Notes to Financial Statements (Unaudited).............................8

Item 2.   Management's Discussion and Analysis of
          Financial Condition and Results of Operations..................14

Item 3.   Quantitative and Qualitative Disclosures About Market Risk.....23


PART II.  OTHER INFORMATION

Item 2.   Changes in Securities..........................................24

Item 4.   Submission of Matters to a Vote of Security Holders............24

Item 6.   Exhibits and Reports on Form 8-K...............................25

Signatures...............................................................28

Item 1. Financial Statements

<TABLE>
                       THE BEARD COMPANY AND SUBSIDIARIES
                                 Balance Sheets
                 June 30, 2001 (Unaudited) and December 31, 2000
<CAPTION>
                                                                June 30,        December 31,
                                Assets                            2001             2000
                                ------                        -------------     -----------
<S>                                                           <C>               <C>
Current assets:
  Cash and cash equivalents                                   $      84,000     $    31,000
  Accounts receivable, less allowance for doubtful
     receivables of $292,000 in 2001 and 2000                       527,000         337,000
  Inventory                                                          42,000         129,000
  Prepaid expenses and other assets                                  25,000          39,000
  Current portion of notes receivable                               473,000          80,000
                                                              -------------     -----------
       Total current assets                                       1,151,000         616,000
                                                              -------------     -----------

Notes receivable                                                    143,000         789,000

Investments and other assets                                         50,000         467,000

Property, plant and equipment, at cost                            5,382,000       5,364,000
  Less accumulated depreciation, depletion and amortization       2,260,000       2,198,000
                                                              -------------     -----------
       Net property, plant and equipment                          3,122,000       3,166,000
                                                              -------------     -----------

Intangible assets, at cost                                           56,000          50,000
Less accumulated amortization                                        16,000           1,000
                                                              -------------     -----------
       Net intangible assets                                         40,000          49,000
                                                              -------------     -----------
                                                              $   4,506,000     $ 5,087,000
                                                              =============     ===========

                      Liabilities and Shareholders' Equity

Current liabilities:
Trade accounts payable                                        $     152,000     $   167,000
Accrued expenses                                                    370,000         578,000
Current maturities of long-term debt                                 11,000          30,000
                                                              -------------     -----------
       Total current liabilities                                    533,000         775,000
                                                              -------------     -----------

Long-term debt less current maturities                              323,000         347,000

Long-term debt - related entity                                   1,812,000       1,081,000

Other long-term liabilities                                         108,000         112,000

Redeemable preferred stock of $100 stated value;
  5,000,000 shares authorized; 27,838 shares issued
  and outstanding in 2001 and 2000 (note 4)                         889,000         889,000

Common shareholders' equity:
  Common stock of $.001333 par value per share; 7,500,000
     shares authorized; 2,123,898 shares issued
     and outstanding in 2001 and 2000                                 3,000           3,000
  Capital in excess of par value                                 38,032,000      37,986,000
  Accumulated deficit                                           (35,320,000)    (34,247,000)
  Accumulated other comprehensive income                            (28,000)        (13,000)
  Treasury stock, 295,053, at cost, in 2001 and 2000             (1,846,000)     (1,846,000)
                                                              -------------     -----------
       Total common shareholders' equity                            841,000       1,883,000
                                                              -------------     -----------
Commitments and contingencies (note 7)
                                                              $   4,506,000     $ 5,087,000
                                                              =============     ===========
</TABLE>

See accompanying notes to financial statements.

<PAGE>
<TABLE>
                                                    THE BEARD COMPANY AND SUBSIDIARIES
                                                         Statements of Operations
                                                               (Unaudited)
<CAPTION>
                                                             For Three Months Ended                   For Six Months Ended
                                                             ----------------------                   --------------------
                                                          June 30,            June 30,             June 30,           June 30,
                                                           2001                2000                 2001               2000
                                                           ----                ----                 ----               ----
<S>                                                      <C>                 <C>                 <C>                <C>
Revenues:
    Coal reclamation                                     $   45,000          $   11,000          $    97,000        $    23,000
    Carbon dioxide                                          116,000             114,000              242,000            213,000
    China                                                         -                   -                    -                  -
    e-Commerce                                                    -                   -                    -                  -
    Natural gas well servicing                                3,000                   -                3,000             65,000
    Other                                                     7,000               9,000               12,000             15,000
                                                         ----------          ----------          -----------        -----------
                                                            171,000             134,000              354,000            316,000
                                                         ----------          ----------          -----------        -----------
Expenses:
    Coal reclamation                                        131,000             184,000              260,000            359,000
    Carbon dioxide                                           21,000              15,000               45,000             36,000
    China                                                         -             107,000                    -            190,000
    e-Commerce                                                    -                   -                    -                  -
    Natural gas well servicing                               15,000               5,000               17,000             48,000
    Selling, general and administrative                     355,000             387,000              670,000            817,000
    Depreciation, depletion & amortization                   43,000              28,000               71,000             53,000
    Other                                                     4,000              12,000               17,000             22,000
                                                         ----------          ----------          -----------        -----------
                                                            569,000             738,000            1,080,000          1,525,000
                                                         ----------          ----------          -----------        -----------
Operating profit (loss):
    Coal reclamation                                       (124,000)           (223,000)            (242,000)          (438,000)
    Carbon dioxide                                           86,000              91,000              180,000            161,000
    China                                                         -             (82,000)                   -           (191,000)
    e-Commerce                                              (52,000)            (79,000)            (103,000)          (154,000)
    Natural gas well servicing                              (63,000)            (48,000)             (95,000)           (76,000)
    Other, primarily corporate                             (245,000)           (263,000)            (466,000)          (511,000)
                                                         ----------          ----------          -----------        -----------
                                                           (398,000)           (604,000)            (726,000)        (1,209,000)
Other income (expense):
    Interest income                                          35,000              30,000               76,000             57,000
    Interest expense                                        (57,000)             (7,000)             (96,000)            (8,000)
    Equity in operations of unconsolidated affiliates       (49,000)             52,000             (106,000)           148,000
    Gain on sale of assets                                   51,000              10,000               68,000             10,000
    Minority interest in operations of subsidiary                 -              10,000                    -             16,000
    Other                                                     4,000              (1,000)               4,000              5,000
                                                         ----------          ----------          -----------        -----------

Loss from continuing operations before income taxes        (414,000)           (510,000)            (780,000)          (981,000)
Income taxes (note 6)                                         2,000              (8,000)              62,000            (14,000)
                                                         ----------          ----------          -----------        -----------
Loss from continuing operations                            (412,000)           (518,000)            (718,000)          (995,000)

    Loss from discontinued operations                       (77,000)           (338,000)            (355,000)          (649,000)
                                                         ----------          ----------          -----------        -----------
Net loss                                                 $ (489,000)         $ (856,000)         $(1,073,000)       $(1,644,000)
                                                         ==========          ==========          ===========        ===========
Net loss per average common share outstanding:
    Basic and diluted:
       Loss from continuing operations                   $    (0.23)         $    (0.28)         $     (0.39)       $     (0.54)
       Loss from discontinued operations                      (0.04)              (0.19)               (0.20)             (0.36)
                                                         ----------          ----------          -----------        -----------
       Net loss                                          $    (0.27)         $    (0.47)         $     (0.59)       $     (0.90)
                                                         ==========          ==========          ===========        ===========

Weighted average common shares outstanding -
    basic and diluted                                     1,829,000           1,829,000            1,829,000          1,829,000
                                                         ==========          ==========          ===========        ===========
</TABLE>

See accompanying notes to financial statements.

<PAGE>
<TABLE>
                                                       THE BEARD COMPANY AND SUBSIDIARIES
                                                       Statements of Shareholders' Equity
<CAPTION>
                                                                                    Accumulated                       Total
                                                  Capital in                          Other                           Common
                                       Common      Excess of      Accumulated      Comprehensive     Treasury      Shareholders'
                                       Stock       Par Value       Deficit            Income           Stock           Equity
                                       -----       ---------       -------            ------           -----           ------
<S>                                    <C>        <C>            <C>                 <C>         <C>               <C>
Balance, December 31, 1999             $  3,000   $ 37,723,000   $( 31,218,000)      $    4,000  $(  1,846,000)    $   4,666,000

    Net loss                                  -              -      (3,029,000)               -              -        (3,029,000)
    Comprehensive income:
      Foreign currency translation
      adjustment                              -              -               -          (17,000)             -           (17,000)
                                                                                                                   -------------
    Comprehensive loss                        -              -               -                -              -        (3,046,000)
                                                                                                                   -------------
    Reservation of shares pursuant to
      deferred compensation plan              -        263,000               -                -              -           263,000
                                       --------   ------------   -------------       ----------  -------------     -------------
Balance, December 31, 2000                3,000     37,986,000     (34,247,000)         (13,000)    (1,846,000)        1,883,000

    Net loss, six months ended June           -              -      (1,073,000)               -              -        (1,073,000)
      30, 2001 (unaudited)
    Comprehensive income:
      Foreign currency translation
      adjustment (unaudited)                  -              -               -          (15,000)             -           (15,000)
                                                                                                                   -------------
    Comprehensive loss (unaudited)            -              -               -                -              -        (1,088,000)
                                                                                                                   -------------
    Reservation of shares pursuant to
      deferred compensation plan
      (unaudited)                             -         46,000               -                -              -            46,000
                                       --------   ------------   -------------       ----------  -------------     -------------
Balance, June 30, 2001 (unaudited)     $  3,000   $ 38,032,000   $( 35,320,000)      $(  28,000) $(  1,846,000)    $     841,000
                                       ========   ============   =============       ==========  =============     =============
</TABLE>

See accompanying notes to financial statements.

<PAGE>
<TABLE>
                               THE BEARD COMPANY AND SUBSIDIARIES
                                    Statements of Cash Flows
                                          (Unaudited)
<CAPTION>
                                                                  For the Six Months Ended
                                                              --------------------------------
                                                              June 30, 2001      June 30, 2000
                                                              --------------------------------
<S>                                                           <C>               <C>
Operating activities:
      Cash received from customers                            $    293,000      $   1,580,000
      Cash paid to suppliers and employees                      (1,299,000)        (2,900,000)
      Interest received                                             69,000             51,000
      Interest paid                                               (120,000)           (28,000)
      Taxes (paid) refunded                                         62,000            (20,000)
                                                              ------------      -------------
           Net cash used in operating activities                  (995,000)        (1,317,000)
                                                              ------------      -------------

Investing activities:
      Acquisition of property, plant and equipment                 (20,000)          (249,000)
      Proceeds from sale of assets                                  68,000             13,000
      Proceeds from redemptions of certificates of deposit               -            280,000
      Investment in and advances to fifty percent-owned           (347,000)          (196,000)
         subsidiary
      Advances for notes receivable                               (302,000)          (163,000)
      Payments on notes receivable                                 896,000             87,000
      Other                                                         41,000            178,000
                                                              ------------      -------------
           Net cash provided by (used in) investing activities     336,000            (50,000)
                                                              ------------      -------------

Financing activities:
      Proceeds from term notes                                   1,043,000            710,000
      Payments on line of credit and term notes                   (331,000)            (9,000)
                                                              ------------      -------------
         Net cash provided by financing activities                 712,000            701,000
                                                              ------------      -------------

Net increase (decrease) in cash and cash equivalents                53,000           (666,000)

Cash and cash equivalents at beginning of period                    31,000            767,000
                                                              ------------      -------------

Cash and cash equivalents at end of period                    $     84,000      $     101,000
                                                              ============      =============
</TABLE>

Continued

<TABLE>
                                    THE BEARD COMPANY AND SUBSIDIARIES
                                         Statements of Cash Flows
                                                (Unaudited)

Reconciliation of Net loss to Net Cash Used in Operating Activities
<CAPTION>
                                                                           For the Six Months Ended
                                                                           ------------------------
                                                                       June 30, 2001        June 30, 2000
                                                                       ----------------------------------
<S>                                                                   <C>                  <C>
Net loss                                                              $   (1,073,000)      $   (1,644,000)
Adjustments to reconcile net loss to net cash
 used in operating activities:
      Depreciation, depletion and amortization                                71,000               54,000
      Gain on sale of assets                                                 (68,000)             (10,000)
      Equity in operations of unconsolidated affiliates                      394,000              389,000
      Net cash used by discontinued operations offsetting
        accrued impairment loss                                              (37,000)            (149,000)
      Minority interest in operations of consolidated subsidiary                   -              (16,000)
      Noncash compensation expense                                                 -                6,000
      (Increase) decrease in accounts receivable, prepaid expenses
         other current assets                                               (194,000)             128,000
      (Increase) decrease in inventories                                     105,000               (6,000)
      Decrease in accounts payable, accrued
         expenses and other liabilities                                     (193,000)             (69,000)
                                                                      ---------------     ---------------
      Net cash used in operating activities                           $     (995,000)     $    (1,317,000)
                                                                      ==============      ===============


Supplemental Schedule of Noncash Investing and Financing Activities:
      Issuance of subsidiary common stock in exchange for
        ownership in applied-for patents                              $            -      $        10,000
                                                                      ==============      ===============
</TABLE>

See accompanying notes to financial statements.

<PAGE>
                       THE BEARD COMPANY AND SUBSIDIARIES
                          Notes to Financial Statements

                             June 30, 2001 and 2000
                                   (Unaudited)

(1)  Summary of Significant Accounting Policies
     Basis of Presentation
     The accompanying financial statements and notes thereto have been prepared
     pursuant to the rules and regulations of the Securities and Exchange
     Commission. Accordingly, certain disclosures normally prepared in
     accordance with generally accepted accounting principles have been omitted.
     The accompanying financial statements and notes thereto should be read in
     conjunction with the audited consolidated financial statements and notes
     thereto included in The Beard Company's 2000 annual report on Form 10-K.

     The accompanying financial statements include the accounts of The Beard
     Company and its wholly and majority-owned subsidiaries in which The Beard
     Company has a controlling financial interest ("Beard or the Company").
     Subdidiaries and investees in which Beard does not exercise control are
     accounted for using the equity method. All significant intercompany
     transactions have been eliminated in the accompanying financial statements.

     The financial information included herein is unaudited; however, such
     information reflects solely normal recurring adjustments which are, in the
     opinion of management, necessary for a fair presentation of the results for
     the interim periods presented.

     The results of operations for the three and six-month periods ended June
     30, 2001, are not necessarily indicative of the results to be expected for
     the full year.

     The Company's current significant operations are within the following
     segments: (1) the Coal Reclamation ("Coal") Segment, (2) the Carbon Dioxide
     ("CO2") Segment, (3) the China ("China") Segment, (4) the e-Commerce
     ("e-Commerce") Segment, and (5) the Natural Gas Well Servicing ("WS")
     Segment.

     The Coal Segment is in the business of operating coal fines reclamation
     and/or briquetting facilities in the U.S. and provides slurry pond core
     drilling services, fine coal laboratory analytical services and consulting
     services. The CO2 Segment consists of the production of CO2 gas. The China
     Segment is pursuing (i) environmental opportunities, (ii) the sale of
     technical services, (iii) the sale of coal equipment, and (iv) the
     operation of coal fines reclamation facilities in China. The e-Commerce
     Segment consists of a 78.4%-owned subsidiary in the process of developing
     and implementing systems and technologies related to Internet commerce. The
     WS Segment is conducted by a wholly-owned company that has designed a sand
     separator for use on natural gas wells and has had five of them custom
     fabricated for use on a trial basis.

     As discussed in note 3: (1) In April 1999, the Company's Board of Directors
     adopted a formal plan to discontinue its interstate travel facilities
     business (the "ITF" Segment); in December 1999 the Management Committee of
     NABR adopted a plan to discontinue its brine extraction/iodine
     manufacturing business which comprised the Company's ("BE/IM") Segment; (3)
     in May 2001 the fixed assets of the 50%-owned company (accounted for as an
     equity investment) involved in natural gas well testing operations were
     sold; and (4) in March 2001 the Company ceased providing financial support
     to its environmental remediation subsidiary, its exclusive marketing
     license was subsequently cancelled, and the ER Segment was discontinued.

     Reclassifications
     Certain 2000 balances have been reclassified to conform to the 2001 pre-
     sentation.

(2)  Liquidity and Ability to Fund Operations
     Despite continuing operating losses during the past 12 months, the
     Company's cash and cash equivalents decreased only slightly from $101,000
     at June 30, 2000 to $84,000 at June 30, 2001. To mitigate potential
     liquidity problems, the Company obtained financing of $1.8 million in 2000,
     and an additional $500,000 in the first half of 2001. $2.0 million of such
     funding was from an affiliate of the Company's chairman. In addition, the
     Company expects to generate cash from the disposition of assets of
     discontinued operations and from the pay down of notes receivable. The sale
     of the fixed assets of the Company's 50%-owned investee in the well testing
     business on May 4, 2001, resulted in the distribution of $821,000 of cash
     to the Company and the reclassification of a portion of a note receivable
     from long-term to current. As a consequence, working capital improved
     $777,000 during the first six months of 2001. To further bolster working
     capital, the Company is also currently pursuing a $750,000 loan backed by
     its CO2 reserves at McElmo Dome.

     The Company is focusing on replacing its Coal Segment's revenues and is
     currently working on two new pond reclamation projects, both of which are
     expected to mature into operating projects for the segment in the next nine
     months. The segment is currently negotiating with a Fortune 500 company
     which has made the decision to install a clean coal preparation plant at a
     pond in West Virginia. The segment is negotiating with third parties
     concerning the installation of the equipment needed for the project. If
     such negotiations are successfully concluded, plant construction is
     expected to commence in the fourth quarter of 2001. Negotiations are also
     in progress in connection with the second project. A bid has been submitted
     to the company involved for the first phase of the project which is
     expected to take approximately 12 months to complete. If we are the
     successful bidder, this phase is expected to commence early in the fourth
     quarter of 2001.

     The Company expects that present working capital, coupled with the cash
     expected to be generated from the sale of assets and from the $750,000 bank
     loan currently being pursued will be sufficient to continue operations
     through 2001 and until the operations of the new coal projects and the
     plants in China have come on stream.

(3)  Discontinued Operations
     BE/IM Segment
     In December 1999, the Management Committee of North American Brine
     Resources ("NABR") adopted a formal plan to discontinue the business and
     dispose of its assets. Beard had a 40% ownership in NABR, which was
     accounted for under the equity method. As a result of the discontinuation,
     Beard's share of NABR's operating results have been reported as
     discontinued for all periods presented in the accompanying statements of
     operations. The joint venture was dissolved effective September 15, 2000
     and the Japanese partners received their final distribution of cash in
     December 2000, with the Company taking over the remaining assets and
     liabilities.

     In December 1999, Beard recorded a $540,000 loss, which represented its
     share of NABR's $1,350,000 estimated loss expected from the discontinuation
     of operations. NABR's loss included $778,000 which represented the
     difference in the estimated amounts expected to be received from the
     assets' disposition and the assets' recorded values as of December 31,
     1999, and $572,000 of anticipated operating losses through April 2000 (the
     date operations ceased) and costs of ceasing operations. NABR's actual
     operating results for the three and six-months periods ended June 30, 2000
     were losses of $81,000 and $137,000, respectively, the Company's share of
     which were charged against the loss accrual recorded in 1999. NABR's actual
     operating results for the three and six-month periods ended June 30, 2001
     were losses of $12,000 and $43,000, respectively, which were charged
     against the loss accrual recorded in 1999. In addition, the Company
     recorded losses of $1,000 and $26,000 for the three and six-month periods
     ended June 30, 2001, respectively, for the operations of the smaller of the
     two plants distributed to Beard from NABR. These losses were not
     anticipated in the loss accrual of 1999.

     As of June 30, 2001, the significant assets related to NABR's operations
     consisted primarily of equipment and inventory with estimated net
     realizable values of $154,000 and $42,000, respectively. The liabilities
     related to NABR's operations consisted primarily of accounts payable
     of $5,000. The Company is actively pursuing opportunities to sell NABR's
     assets and expects the disposition to be completed by December 31, 2001.

     ITF Segment
     In April of 1999, the Company's Board of Directors adopted a formal plan to
     discontinue its interstate travel facilities ("ITF") Segment and recorded a
     $1,603,000 estimated loss for the discontinuance in 1998. In November of
     1999 ITF disposed of a majority of its assets and was relieved of its
     outstanding debt of $2,149,000 and accounts payable of $126,000. ITF
     retained two convenience stores ("C-stores"), including their equipment and
     inventory, and Beard became 100% owner of ITF.

     In the fourth quarter of 1999, Beard recorded an additional $214,000 loss
     related to the discontinued ITF Segment. Revenues from the discontinued ITF
     Segment were $580,000 and $1,118,000, respectively, for the three and
     six-month periods ended June 30, 2000. ITF's actual operating losses for
     the three and six-months periods ended June 30, 2000 were $37,000 and
     $149,000, respectively. Such losses were charged against the loss accrual
     recorded in the fourth quarter of 1999.

     Beard recorded an additional $420,000 loss in December 2000; $60,000
     represented losses expected to be incurred by the discontinued ITF Segment
     from the date of shutdown through the anticipated disposal date of the
     remaining assets; $360,000 of the loss represented an additional reduction
     in the estimated realizable value of the remaining C-stores and related
     assets as of December 31, 2000. The discontinued ITF Segment had no
     revenues for the three months ended June 30, 2001 while recording revenues
     of $7,000 for the six-month period ended June 30, 2001. ITF's actual
     operating losses for the three and six-months periods ended June 30, 2001
     were $6,000 and $37,000, respectively. Such losses were charged against the
     loss accrual recorded in the fourth quarter of 2000.

     As of June 30, 2001, the significant assets related to the ITF Segment
     consisted primarily of the two remaining C-stores with a total recorded
     value of $499,000. The significant liabilities of the segment consist of
     trade accounts payable and accrued expenses totaling $28,000. Beard is
     actively seeking opportunities to sell the remaining C-stores and expects
     them to be sold by year-end 2001.

     ITS-Testco, LLC
     On May 4, 2001, the fixed assets of the 50% owned company involved in
     natural gas well testing operations for the Natural Gas Well Servicing
     Segment were sold for $1,550,000, subject to a 90 day hold back of
     $150,000. $21,000 of the hold back was received on June 4, 2001. Beard's
     share of operating losses from the discontinued company were $75,000 and
     $313,000, respectively for the three and six-month periods ending June 30,
     2001. The six month period included a provision of $175,000 for estimated
     losses from the discontinuation of operations. Beard's share of operating
     losses from the discontinued company were $282,000 and $528,000,
     respectively for the three and six-month periods ending June 30, 2000.

     As of June 30, 2001 the 50% owned company in the WS Segment had cash and
     accounts receivable of $5,000 and $194,000, respectively. No other
     significant assets remained. The significant liabilities of the entity
     consisted of taxes payable, trade accounts payable and accrued expenses of
     $219,000, $102,000 and $36,000, respectively. It is anticipated that all
     liabilities of the subsidiary, totaling approximately $357,000, will be
     paid off during the third quarter of 2001 and that the company will be
     dissolved in May of 2002.

     ISITOP, Inc.
     In March of 2001 the Company determined that it would no longer provide
     financial support to ISITOP, Inc., an 80%-owned subsidiary specializing in
     the remediation of polycyclic aromatic hydrocarbon ("PAH") contamination.
     The operations of ISITOP had previously comprised the Company's
     environmental remediation ("ER") Segment. On May 31, 2001, ISITOP was
     notified by the Licensor that the segment's exclusive U.S. marketing
     license for the chemical used for such PAH remediation had been cancelled.
     ISITOP generated no revenues in 2001 or in 2000. ISITOP's operating losses
     totaled less than $1,000 and $17,000 for the second quarter and six months
     of 2001, respectively. The operating losses totaled $52,000 and $117,000
     for second quarter and six months of 2000, respectively. ISITOP had no
     significant assets or liabilities at June 30, 2001.

(4)  Redeemable Preferred Stock
     The Company's preferred stock is mandatorily redeemable through December
     31, 2002, from one-third of Beard's "consolidated net income" as defined.
     Accordingly, one-third of future "consolidated net income" will accrete
     directly to preferred stockholders and reduce earnings per common share.
     The Company's 2001 operations through June 30 were not sufficient to begin
     the sharing of the consolidated net income. To the extent that the
     preferred stock is not redeemed by December 31, 2002, the shares of
     preferred stock can be converted into shares of the Company's common stock.

(5)  Loss Per Share
     Basic loss per share data is computed by dividing loss attributable to
     common shareholders by the weighted average number of common shares
     outstanding for the period.

     Diluted loss per share in the statements of operations exclude potential
     common shares issuable upon conversion of redeemable preferred stock or
     exercise of stock options as a result of losses from continuing operations
     for all periods presented.

(6)  Income Taxes
     In accordance with the provisions of the Statement of Financial Accounting
     Standard No. 109, "Accounting for Income Taxes" ("SFAS No. 109"), the
     Company's net deferred tax asset is being carried at zero book value, which
     reflects the uncertainties of the Company's utilization of the future net
     deductible amounts. The Company recorded refunds of $41,000, $2,000 and
     $19,000 for federal, foreign and state income taxes, respectively, for the
     six months ended June 30, 2001. The provision for income taxes for the
     three and six months ended June 30, 2000 consist of federal alternative
     minimum tax of $8,000 and $14,000, respectively.

     At June 30, 2001, the Company estimates that it had the following income
     tax carryforwards available for both income tax and financial reporting
     purposes (in thousands):

<TABLE>
<CAPTION>
                                                    Expiration
                                                      Date           Amount
                                                      ----           ------
<S>                                                 <C>             <C>
Federal regular tax operating loss carryforwards    2004-2009       $  52,800

Tax depletion carryforward                          Indefinite      $   5,500
</TABLE>

(7)  Commitments and Contingencies
     In the normal course of business various actions and claims have been
     brought or asserted against the Company. Management does not consider them
     to be material to the Company's financial position, liquidity or results of
     operations.

     In connection with the sale of the fixed assets of the Mexican well testing
     operations the Company and its 50% partner have each, as to 50%,
     indemnified the purchaser from and against any claims, demands, actions,
     damages, cause of action, cost, liability, penalties and expense (including
     reasonable legal fees) that purchaser or its successors or assigns may
     suffer arising from the Mexican subsidiary's failure to file any applicable
     tax returns or pay any and all of its taxes which had accrued prior to the
     sale date. As of June 30, 2001, the accrued tax liabilities were estimated
     to be $149,000, with the Company liable for one-half of such amount.

     The Company has an indemnity obligation to its institutional preferred
     stockholder and one of its assignees for certain losses (i) arising out of
     the ownership and/or operation of Beard Oil's former oil and gas assets,
     including environmental liabilities; (ii) arising under any employee
     benefit or severance plan; or (iii) relating to any misrepresentation or
     inaccuracy in any representation made by the Company or Beard Oil in
     connection with the Restructure (collectively, the "Obligations"). Neither
     Beard nor Beard Oil is presently aware of any material liabilities existing
     as a result of such Obligations.

(8)  Business Segment Information
     The Company manages its business by products and services and by geographic
     location (by country). The Company evaluates its operating segments'
     performance based on earnings or loss from operations before income taxes.
     The Company had four reportable segments in the first half of 2001 and
     2000: Coal, Carbon Dioxide, Natural Gas Well Servicing, and China.

     The Coal Segment is in the business of operating coal fines reclamation
     and/or briquetting facilities in the U.S. and is pursuing the development
     of advanced fine coal preparation processes. The Carbon Dioxide Segment
     consists of the production of CO2 gas. The China Segment is pursuing (i)
     environmental opportunities, (ii) the sale of technical services, (iii) the
     sale of coal equipment, and (iv) the operation of coal fines reclamation
     facilities in China. The Natural Gas Well Servicing Segment is conducted by
     a wholly-owned company that has designed a sand separator for use on
     natural gas wells and has had five separators custom fabricated for use on
     a trial basis.

     The following is certain financial information regarding the Company's
     reportable segments (presented in thousands of dollars). The information
     contained in "Other" relates to the Company's e-Commerce Segment and
     consists of start-up costs.

     General corporate assets and expenses are not allocated to any of the
     Company's operating segments; therefore, they are included as a reconciling
     item to consolidated total assets and loss from continuing operations
     before income taxes reported in the Company's accompanying financial
     statements.

<TABLE>
<CAPTION>
                                          Carbon                Natural Gas
                              Coal        Dioxide    China     Well Servicing   Other     Totals
                              ----        -------    -----     --------------   -----     ------
<S>                          <C>         <C>        <C>         <C>            <C>       <C>
   Three months ended
   ------------------
   June 30, 2001
   -------------
     Revenues from
       external  customers   $  45       $ 116      $   -       $   3          $   -     $  164
     Segment profit (loss)    (125)         87        (87)        (96)           (53)      (274)

   Three months ended
   ------------------
   June 30, 2000
   -------------
     Revenues from
       external  customers   $  11       $ 114      $   -       $   -          $   -     $  125
     Segment profit (loss)    (223)         91        (82)        (49)           (79)      (342)

   Six months ended
   ----------------
   June 30, 2001
   -------------
     Revenues from
       external  customers   $  97       $  242     $   -       $   3          $   -     $  342
     Segment profit (loss)    (243)         180      (177)       (102)          (104)      (446)
     Segment assets          1,642          436       156         183             61      2,478

   Six months ended
   ----------------
   June 30, 2000
   -------------
     Revenues from
       external  customers   $  23       $  213     $   -      $   65          $   -     $  301
     Segment profit (loss)    (439)         160      (191)        (76)          (153)      (699)
     Segment assets          1,415          455         -         237             60      2,167
</TABLE>


     Reconciliation of total reportable segment loss to consolidated loss from
     continuing operations before income taxes is as follows for the three and
     six months ended June 30, 2001 and 2000 (in thousands):

<TABLE>
<CAPTION>
                                                   For the Three Months          For the Six Months
                                                           Ended                       Ended
                                                           -----                       -----
                                                  June 30,     June 30,       June 30,        June 30
                                                   2001         2000            2001           2000
                                                   ----         ----            ----           ----
<S>                                               <C>          <C>             <C>            <C>
Total loss for reportable segments                $ (274)      $ (342)         $ (446)        $ (699)

Net corporate costs not allocated to segments       (140)        (168)           (334)          (282)
                                                  ------       ------          ------         ------
     Total consolidated loss for continuing
        operations                                $ (414)      $ (510)         $ (780)        $ (981)
                                                  ======       ======          ======         ======
</TABLE>

                       THE BEARD COMPANY AND SUBSIDIARIES

                 DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

     THIS REPORT INCLUDES "FORWARD-LOOKING STATEMENTS" WITHIN THE MEANING OF
SECTION 27A OF THE SECURITIES ACT OF 1933, AS AMENDED, AND SECTION 21E OF THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. ALL STATEMENTS OTHER THAN
STATEMENTS OF HISTORICAL FACTS INCLUDED OR INCORPORATED BY REFERENCE IN THIS
REPORT, INCLUDING, WITHOUT LIMITATION, STATEMENTS REGARDING THE COMPANY'S FUTURE
FINANCIAL POSITION, BUSINESS STRATEGY, BUDGETS, PROJECTED COSTS AND PLANS AND
OBJECTIVES OF MANAGEMENT FOR FUTURE OPERATIONS, ARE FORWARD-LOOKING STATEMENTS.
IN ADDITION, FORWARD-LOOKING STATEMENTS GENERALLY CAN BE IDENTIFIED BY THE USE
OF FORWARD-LOOKING TERMINOLOGY SUCH AS "MAY," "WILL," "EXPECT," "INTEND,"
"PROJECT," "ESTIMATE," "ANTICIPATE," "BELIEVE," OR "CONTINUE" OR THE NEGATIVE
THEREOF OR VARIATIONS THEREON OR SIMILAR TERMINOLOGY. ALTHOUGH THE COMPANY
BELIEVES THAT THE EXPECTATIONS REFLECTED IN SUCH FORWARD-LOOKING STATEMENTS ARE
REASONABLE, IT CAN GIVE NO ASSURANCE THAT SUCH EXPECTATIONS WILL PROVE TO HAVE
BEEN CORRECT. IMPORTANT FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM THE COMPANY'S EXPECTATIONS ("CAUTIONARY STATEMENTS") ARE
DISCLOSED UNDER "ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS" AND ELSEWHERE IN THIS REPORT. ALL
SUBSEQUENT WRITTEN AND ORAL FORWARD-LOOKING STATEMENTS ATTRIBUTABLE TO THE
COMPANY, OR PERSONS ACTING ON ITS BEHALF, ARE EXPRESSLY QUALIFIED IN THEIR
ENTIRETY BY THE CAUTIONARY STATEMENTS. THE COMPANY ASSUMES NO DUTY TO UPDATE OR
REVISE ITS FORWARD-LOOKING STATEMENTS BASED ON CHANGES IN INTERNAL ESTIMATES OR
EXPECTATIONS OR OTHERWISE.

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations

     The following discussion focuses on material changes in the Company's
financial condition since December 31, 2000 and results of operations for the
quarter ended June 30, 2001, compared to the prior year second quarter and the
six months ended June 30, 2001 compared to the prior year six months. Such
discussion should be read in conjunction with the Company's financial statements
including the related footnotes.

     In preparing the discussion and analysis, the Company has presumed readers
have read or have access to the discussion and analysis of the prior year's
results of operations, liquidity and capital resources as contained in the
Company's 2000 Form 10-K.

     The Coal Segment is in the business of operating coal fines reclamation
and/or briquetting facilities in the U.S. and provides slurry pond core drilling
services, fine coal laboratory analytical services and consulting services. The
CO2 Segment consists of the production of CO2 gas. The China Segment is pursuing
(i) environmental opportunities, (ii) the sale of coal equipment, (iii) the sale
of technical services, and (iv) the operation of coal fines reclamation
facilities in China. The e-Commerce Segment consists of a subsidiary which is
pursuing the development of a proprietary Internet-only payment system. The WS
Segment is conducted by a wholly-owned company that has designed a sand
separator for use on natural gas wells and has had five separators custom
fabricated for use on a trial basis.

     In April 1999 the Company adopted a plan to discontinue its "ITF" Segment,
and those operations were reflected as discontinued operations in 1998. The
majority of the assets of the ITF Segment were disposed of in November 1999 and
the Company is pursuing the sale of the remaining assets. In December 1999 the
Company adopted a plan to discontinue its "BE/IM" Segment, and those operations
were reflected as discontinued operations in 1999. The Company is now in the
process of liquidating those assets. In March 2001 the Company ceased providing
financial support to ISITOP, Inc. and shortly thereafter its exclusive marketing
license was terminated. Accordingly, the operations of the "ER" Segment have
been reflected as discontinued.


Material changes in financial condition - June 30, 2001 as compared with
December 31, 2000.

     The following table reflects changes in the Company's financial condition
during the periods indicated:

<TABLE>
<CAPTION>
                            June 30,            December 31,         Increase
                              2001                  2000            (Decrease)
                              ----                  ----            ----------
<S>                         <C>               <C>                 <C>
Cash and cash equivalents   $   84,000        $    31,000         $    53,000

Working capital             $  618,000        $  (159,000)        $   777,000

Current ratio                2.16 to 1          0.79 to 1
</TABLE>


     During the first six months of 2001, the Company increased its working
capital by $777,000 from $(159,000) as of December 31, 2000. A related entity of
the Chairman of the Board advanced $733,000 to the Company. As a result of the
sale of the fixed assets held by the 50%-owned company in the WS Segment,
$410,000 of a long-term note receivable were reclassified to current assets as
of March 31, 2001. Payment of this amount was received on May 4, 2001. See note
3 to the financial statements. $223,000 of working capital were used to help
fund the operations of the Coal Segment. There were net advances of $201,000 to
the Company's joint venture involved in natural gas well testing in northeastern
Mexico. The Company received payments on notes receivable totaling $896,000
during the six months ended June 30, 2001. $177,000 and $103,000, respectively,
were used to fund the startup activities of the China and e-Commerce Segments.
The remainder of the working capital was utilized to fund other operations.

     The Company's principal business is coal reclamation, and this is where
management's attention is primarily focused. The Coal Segment is pursuing two
major coal projects at this time. If we are successful in concluding
negotiations with third parties concerning the installation of the equipment
needed, plant construction of the first project is expected to commence in the
fourth quarter of 2001. However, there is no assurance this will occur.
Negotiations are also in progress in connection with the second project. A bid
has been submitted to the company involved for the first phase of the project
which is expected to take approximately 12 months to complete. If we are the
successful bidder, this phase is expected to commence early in the fourth
quarter of 2001.

     Meanwhile, the outlook for the China Segment has brightened considerably.
After almost three years of development activity, it appears that its efforts
are finally starting to bear fruit. The segment has signed contracts and formed
Cooperative Joint Ventures ("CJV's") or similar arrangements with various
Chinese partners for the construction of four compost manufacturing facilities
in which the Company will own an interest and will also receive an operating
fee. Groundbreaking for the initial plant, located at Baoding in Hebei Province,
occurred in early March and plant construction commenced in late May. Assuming
we are able to meet our revised timetable for the construction of the four
composting plants, the China Segment is expected to achieve a breakeven cash
flow by year-end 2001 and the Company will no longer need to infuse capital to
subsidize the segment's ongoing operations.

     The Company's project financing plans for the Coal Segment are on hold
until the status of the two projects we're working on has been determined.
Meanwhile, the Company's $300,000 bank line of credit together with the $2.0
million line of credit provided by a related party are expected to be sufficient
to meet the Company's working capital requirements through 2001. In addition,
the Company expects to generate cash from the disposition of assets of
discontinued operations and from the pay down of notes receivable. It is also
pursuing a $750,000 loan backed by its CO2 reserves at McElmo Dome. On May 4,
2001, the fixed assets of the 50% owned company involved in natural gas well
testing operations in northeastern Mexico were sold for $1,550,000, subject to a
90 day holdback of $150,000. $21,000 of the holdback was received in June 2001.
It is anticipated that all liabilities of the subsidiary will be paid off in the
third quarter of 2001 and that the Company will receive the balance of the
holdback. The disposition of the Mexican assets and the payoff of the
liabilities related thereto has eliminated $512,000 of contingent liabilities
and generated more than $821,000 of cash for the Company.

     The Company's future cash flows and availability of credit are subject to a
number of variables, including demand for the Company's coal reclamation
services and technology, continuing demand for CO2 gas, demand for the sale of
the Company's environmental and technology services in China, demand for the
Company's secure payment system for Internet transactions. and demand for the
services provided by the Company's WS operations. The Company anticipates that
its present working capital and available credit lines, together with funds
expected to be generated from the sale of assets, are sufficient to enable it to
fund its operations through 2001. Additionally, the McElmo Dome litigation is
scheduled for trial on September 4, 2001, and there is the possibility that a
settlement will be reached before the trial is concluded.

     Through the period ending December 31, 2002, the Company's liquidity will
be reduced to the extent it is required to redeem any of the Beard preferred
stock pursuant to the mandatory redemption provisions. See Note 4 to the
accompanying financial statements.

Material changes in results of operations - Quarter ended June 30, 2001 as
compared with the Quarter ended June 30, 2000.

     The net loss for the second quarter of 2001 was $489,000 compared to
$856,000 for the 2000 second quarter. Continuing operations posted a net loss of
$412,000 compared to a loss from continuing operations of $518,000 for the same
period in 2000. In addition, the Company had losses from discontinued operations
of $77,000 for the second quarter of 2001 compared to a loss of $338,000 for the
comparable quarter of 2000.

     The operating loss in the Coal Segment decreased by $99,000. The operating
profit in the CO2 Segment decreased $5,000. The China Segment reflected an
operating loss of $82,000 for the second quarter of 2000. These operations are
now conducted through an affiliate and as such are reflected in equity in
unconsolidated affiliates, which posted a loss of $89,000 for the second quarter
of 2001. The e-Commerce Segment incurred operating losses of $52,000 for the
second quarter of 2001 compared to $79,000 in the second quarter of 2000. The
operating loss in the Natural Gas Well Servicing Segment increased by $15,000.
The operating loss in Other activities for the second quarter of 2001 decreased
$18,000 compared to the same period in 2000. As a result, the operating loss for
the current quarter decreased $206,000 to $398,000 versus $604,000 in the
corresponding quarter of the prior year.

     Operating results of the Company's primary operating Segments are reflected
below:

<TABLE>
<CAPTION>
                                                  2001           2000
                                                  ----           ----
<S>                                         <C>             <C>
          Operating profit (loss):
             Coal reclamation               $    (124,000)  $   (223,000)
             Carbon dioxide                         86,000         91,000
             China                                       -       (82,000)
             e-Commerce                           (52,000)       (79,000)
             Natural gas well servicing           (63,000)       (48,000)
                                            -------------   -------------
                      Subtotal                   (153,000)      (341,000)
             Other                               (245,000)      (263,000)
                                            -------------   ------------
                                            $    (398,000)  $   (604,000)
                                            =============   ============
</TABLE>

     The "Other" in the above table reflects primarily general and corporate
activities, as well as other activities of the Company.

Coal reclamation

     The segment increased its revenues to $45,000 for the second quarter of
2001 compared to $11,000 for the same period in 2000 as the result of obtaining
several small consulting and coring jobs in the year 2001. Operating costs
decreased $53,000 to $131,000 for the second quarter of 2001 compared to
$184,000 for the same period in 2000. The decrease was primarily attributable to
significantly lower labor costs related to the drilling work performed in 2001
versus 2000 as a result of a reduction in staffing. SG&A costs decreased $14,000
for the second quarter of 2001 compared to the same period in 2000. As a result,
the operating loss for the second quarter of 2001 decreased $99,000 to $124,000
for the second quarter of 2001 compared to $223,000 in the second quarter of
2000.

Carbon dioxide

     Second quarter 2001 operations reflected an operating profit of $86,000
compared to $91,000 for the 2000 second quarter. The sole component of revenues
for this segment is the sale of CO2 gas from the working and overriding royalty
interests of the Company's two carbon dioxide producing units in Colorado and
New Mexico. Operating revenues in this segment increased $2,000 to $116,000 for
the second quarter of 2001 compared to $114,000 for the same period in 2000.
Higher oil and gas prices in 2000 and 2001 have caused an increase in the demand
for CO2 gas for tertiary recovery. The increase in revenue for the current
quarter was entirely due to higher pricing, with the Company receiving an
average of $0.41 per mcf sold in the 2001 quarter versus $0.34 per mcf in the
year earlier quarter. Volumes were actually down 52,000 mcf in the current
quarter versus a year ago due to underproduction.

China

     The China Segment reflected an operating loss of $82,000 for the second
quarter of 2000. Effective January 1, 2001, the operations of this segment are
being conducted through an affiliate. The results of operations for the second
quarter of 2001 were a loss of $89,000 and are included in equity in operations
of unconsolidated affiliates discussed below. The segment had no revenues in
either the second quarter of 2001 or 2000.

e-Commerce

     The Company's startup company involved in the development of a secure
Internet purchasing system incurred an operating loss of $52,000 for the second
quarter of 2001 versus an operating loss of $79,000 in the prior year quarter.
The segment has cut back its pursuit of strategic alliances pending the issuance
of pending patent claims. The segment had no revenues in either the second
quarter of 2001 or 2000 while pursuing the development of its technology.

Natural gas well servicing

     The operations of both of the companies comprising the WS Segment, which
conduct natural gas well servicing operations in northeastern Mexico, were
suspended in late January, 2000 after contracts with Petroleos Mexicanos
("Pemex") were not renewed. Assets of the 50%-owned well servicing company were
sold in May 2001 and that company's operations have been discontinued. Beard's
share of the operating losses from the discontinued company was $75,000 for the
second quarter of 2001 versus a loss of $282,000 for the same period in 2000.
The Company had booked an impairment provision of $100,000 for the first quarter
of 2001. The $75,000 in operating losses for the second quarter represents an
additional impairmnet provision relating to shutting down the natural gas well
testing operations. The sand separator company incurred an operating loss of
$63,000 for the second quarter of 2001 compared to a loss of $48,000 for the
same period in 2000.

Other corporate activities

     Other corporate activities include general and corporate operations, as
well as assets unrelated to the Company's operating segments or held for
investment. These activities generated operating losses of $245,000 for the
second quarter of 2001 as compared to $263,000 for the same period of 2000. This
reduction in operating losses was due primarily to lower professional fees.

Selling, general and administrative expenses

     The Company's selling, general and administrative expenses ("SG&A") in the
current quarter decreased to $355,000 from $387,000 in the 2000 second quarter.
The primary reasons for this were a $12,000 decrease in SG&A expenses incurred
by the Coal Segment as the segment was downsized while its personnel continued
to seek new opportunities for its technology during the second three months of
2001 compared to the same period in 2000. The e-Commerce Segment incurred
$52,000 in SG&A for the second quarter of 2001 compared to $79,000 for the same
period in 2000 as the segment scaled back its pursuit of strategic alliances.
The WS Segment incurred $3,000 less in SG&A expenses for the second quarter of
2001 compared to the same period in 2000 as the segment ceased operations in
Mexico while continuing to seek work for its sand separators in south Texas.

Depreciation, depletion and amortization expenses

     DD&A expense increased $15,000 from $28,000 in the second quarter of 2000
to $43,000 in the same period of 2001. The increase was due to an increase in
the amount of equipment owned by the Company at June 30, 2001 compared to the
same date in 2000 and a $14,000 impairment of certain intangibles owned by the
sand separator company.

Other income and expenses

     The other income and expenses for the second quarter of 2001 netted to a
loss of $16,000 compared to income of $94,000 for the same period in 2000.
Interest income was up $5,000 for the second quarter of 2001 compared to the
same period in 2000 as a result of increased amounts loaned to fund our
partner's operations in Mexico. Interest expense was $50,000 higher as a result
of the increase in debt, primarily to a related party. The Company realized a
gain on sale of assets for the three months ended June 30, 2001 of $51,000
versus $10,000 in the prior year second quarter.

     The Company's equity in the operations of unconsolidated affiliates was a
loss of $49,000 for the second quarter of 2001 compared to income of $52,000 for
the same period in 2000. The Company's equity in the earnings of Cibola
decreased $7,000 from $47,000 for the second quarter of 2000 to $40,000 for the
same period in 2001 reflecting Cibola's decline in operating results. Through a
wholly-owned subsidiary, the Company has signed contracts and formed Cooperative
Joint Ventures ("CJV's") or similar arrangements with various Chinese partners
for the construction of four facilities and the marketing and sale of
organic-chemical compound fertilizer ("OCCF") utilizing two types of organic
waste materials: sewage sludge and crop-residual agri-waste. The personnel
employed by the subsidiary devote all their time and energies to the development
of the business related to the technology utilized by the CJV's. The Company's
share of the losses from these operations was $89,000 for the three months ended
June 30, 2001.

Income taxes

     The Company made no provision for income taxes in the second quarter of
2001. The Company provided for $8,000 in federal alternative minimum tax expense
in the second quarter of 2000. The Company has not recorded any financial
benefit attributable to its various tax carryforwards due to uncertainty
regarding their utilization and realization. The Company recorded a $2,000
reduction in taxes payable to Mexico during the second quarter of 2001.

Discontinued operations

     North American Brine Resources
     In December 1999, the Management Committee of North American Brine
Resources ("NABR") adopted a formal plan to discontinue the business and dispose
of its assets. Beard had a 40% ownership in NABR, which was accounted for under
the equity method. As a result of the discontinuation, Beard's share of NABR's
operating results have been reported as discontinued for all periods presented
in the accompanying statements of operations. The joint venture was dissolved
effective September 15, 2000 and the Japanese partners received their final
distribution of cash in December 2000, with the Company taking over the
remaining assets and liabilities.

     In December 1999, Beard recorded a $540,000 loss, which represented its
share of NABR's $1,350,000 estimated loss expected from the discontinuation of
operations. NABR's loss included $778,000 which represented the difference in
the estimated amounts expected to be received from the assets' disposition and
the assets' recorded values as of December 31, 1999, and $572,000 of anticipated
operating losses through April 2000 (the date operations ceased) and costs of
ceasing operations. NABR's actual loss for the three months ended June 30, 2000
was $81,000 which was charged against the loss accrual recorded in 1999.  Beard
recorded a loss of $1,000 for the three months ended June 30, 2001 for net
operating expenses of the smaller of two plans distributed to the Company in
2000.  This loss was not anticipated in the loss accrual of 1999.

     As of June 30, 2001, the significant assets related to NABR's operations
consisted primarily of equipment and inventory with estimated net realizable
values of $154,000 and $42,000 respectively. The liabilities related to NABR's
operations consisted primarily of accounts payable of $5,000. The Company is
actively pursuing opportunities to sell NABR's assets and expects the
disposition to be completed by December 31, 2001.

     ITF Segment
     In April of 1999, the Company's Board of Directors adopted a formal plan to
discontinue its interstate travel facilities ("ITF") Segment and recorded a
$1,603,000 estimated loss for the discontinuance in 1998. In November of 1999
ITF disposed of a majority of its assets and was relieved of its outstanding
debt of $2,149,000 and accounts payable of $126,000. ITF retained two
convenience stores ("C-stores"), including their equipment and inventory, and
Beard became 100% owner of ITF.

     In the fourth quarter of 1999, Beard recorded an additional $214,000 loss
related to the discontinued ITF Segment. ITF's revenues and actual operating
losses were $580,000 and $37,000, respectively, for the three months ended June
30, 2000. The actual losses for the three months ended June 30, 2000 were
charged against the loss accrual recorded in the fourth quarter of 1999.

     Beard recorded an additional $420,000 loss in December 2000; $60,000
represented losses expected to be incurred by the discontinued ITF Segment from
the date of shutdown through the anticipated disposal date of the remaining
assets; $360,000 of the loss represented an additional reduction in the
estimated realizable value of the remaining C-stores and related assets as of
December 31, 2000. ITF had no revenues for the second quarter of 2001 and its
actual operating losses were $6,000 for the same period. The actual losses for
the three months ended June 30, 2001 were charged against the loss accrual
recorded in the fourth quarter of 2000.

     As of June 30, 2001, the significant assets related to the ITF Segment
consisted primarily of the two remaining C-stores with a total recorded value of
$499,000. The significant liabilities of the segment consist of trade accounts
payable and accrued expenses totaling $28,000. Beard is actively seeking
opportunities to sell the remaining C-stores and expects them to be sold by
year-end 2001.

     ITS-TESTCO, L.L.C.
     In 1998 the Company invested in a 50%-owned subsidiary, ITS-Testco, L.L.C.,
which conducted natural gas well testing operations in Mexico as a subcontractor
to PEMEX or as a subcontractor to contractors working for PEMEX through a
wholly-owned subsidiary, Testco de Mexico, S.A. de C.V. The operations of these
entities have not been consolidated since the LLC was managed by our 50%
partner. This entity generated its initial revenues in the first quarter of 1999
which were not sufficient to cover the overhead costs of the operations. The
operations of this entity were severely curtailed in the first quarter of 2000
as Pemex allowed the contracts for its subcontractors providing services to
expire rather than have them automatically renew. The Company recorded
$1,069,000 as its share of losses from the LLC for the year ended December 31,
2000.

     On May 4, 2001 the fixed assets of the LLC and its subsidiary were sold for
$1,550,000, subject to a 90 day hold back of $150,000. As of June 30, 2001 the
remaining assets of the two entities consisted of cash of $5,000 and accounts
and other receivables totaling $194,000. It is anticipated that the remaining
liabilities of the LLC and its subsidiary, consisting of taxes payable, trade
accounts payable and accrued expenses of $219,000, $102,000 and $36,000,
respectively, will be paid off in the third quarter of 2001 and that the
entities will be dissolved in May of 2002.

     The Company recorded a loss of $238,000, including a provision of $100,000
for estimated losses from the discontinuation of operations, for the first three
months of 2001. In the second quarter of 2001 an additional loss from
discontinuance of $75,000 was recorded compared to a loss of $245,000 for the
same period in 2000 relating to the operations of these entities.

     ISITOP, Inc.
     In March of 2001 the Company determined that it would no longer provide
financial support to ISITOP, Inc., an 80%-owned subsidiary specializing in the
remediation of polycyclic aromatic hydrocarbon ("PAH") contamination. The
operations of ISITOP had previously comprised the Company's environmental
remediation ("ER") Segment. On May 31, 2001, ISITOP was notified by the Licensor
that the segment's exclusive U.S. marketing license for the chemical used for
such PAH remediation had been cancelled. ISITOP generated no revenues in 2001 or
in 2000. The segment's operating losses were less than $1,000 and $52,000 for
the three months ended June 30, 2001 and 2000, respectively. ISITOP had no
significant assets or liabilities at June 30, 2001.


Material changes in results of operations - Six months ended June 30, 2001 as
compared with the Six months ended June 30, 2000.

     The net loss for the six months ended June 30, 2001 was $1,073,000,
compared to a net loss of $1,644,000 for the first six months of the prior year.
Continuing operations posted a net loss of $718,000 after tax credits of $62,000
compared to a loss from continuing operations of $995,000 after taxes of $14,000
for the same period in 2000. In addition, the Company had losses from
discontinued operations of $355,000 and $649,000 for the first half of 2001 and
2000, respectively.

     Operating results of the Company's primary operating segments are reflected
below:

<TABLE>
<CAPTION>
                                                2001                 2000
                                                ----                 ----
<S>                                       <C>                 <C>
        Operating profit (loss):
          Coal reclamation                $     (242,000)     $     (438,000)
          Carbon dioxide                         180,000             161,000
          China                                        -            (191,000)
          e-Commerce                            (103,000)           (154,000)
          Natural gas well servicing             (95,000)            (76,000)
                                          --------------      --------------
                    Subtotal                    (260,000)           (698,000)
          Other                                 (466,000)           (511,000)
                                          --------------      --------------
                     Total                $     (726,000)     $   (1,209,000)
                                          ==============      ==============
</TABLE>

     The "Other" in the above table reflects primarily general and corporate
activities, as well as other activities and investments of the Company.

Coal reclamation

     The Company's coal reclamation revenues increased to $97,000 for the first
six months of 2001 compared to $23,000 for the same period in 2000 as the result
of obtaining several small consulting and coring jobs in the year 2001. Despite
the increase in revenues, operating costs decreased $99,000 to $260,000 for the
first six months of 2001 compared to $359,000 for the same period in 2000. The
decrease was primarily attributable to significant reductions in labor and other
overhead costs achieved in the interim period. SG&A costs also decreased,
dropping to $49,000 for the first six months of 2001 compared to $93,000 for the
same period in 2000. As a result, the operating loss for the first six months of
2001 decreased $196,000 to $242,000 for the first six months of 2001 compared to
$438,000 in the first six months of 2000.

Carbon dioxide

     Operations for the first six months of 2001 resulted in an operating profit
of $180,000 compared to a $161,000 operating profit for the 2000 first half. The
sole component of revenues for this segment is the sale of CO2 gas from the
working and overriding royalty interests of the Company's two carbon dioxide
producing units in Colorado and New Mexico. Operating revenues in this segment
increased $29,000 or 14% to $242,000 for the first six months of 2001 compared
to $213,000 for the same period in 2000. The Company recorded $9,000 more in
operating costs associated with the properties in the first half of 2001
compared to the same period in 2000. Higher oil and gas prices in 2000 and 2001
have caused an increase in the demand for CO2 gas for tertiary recovery. While
production volumes for the McElmo Dome field increased for the first six months
of 2001 compared to the same period in 2000, paid volumes to the Company's
interest decreased as the Company reduced its overproduced status. The increase
in revenue for the current six months was entirely due to higher pricing, with
the Company receiving an average of $0.42 per mcf sold in the first six months
of 2001 versus $0.30 per mcf in the year earlier period. Paid volumes were
actually down 119,000 mcf in the current six months versus a year ago due to
underproduction.

China

     The China Segment reflected an operating loss of $191,000 for the second
quarter of 2000. Effective January 1, 2001, the operations of this segment are
being conducted through an affiliate. The results of operations for the first
six months of 2001 were a loss of $177,000 and are included in equity in
operations of unconsolidated affiliates discussed below. The segment had no
revenues in either the first half of 2001 or 2000.

e-Commerce

     The Company's startup company involved in the development of a secure
Internet purchasing system incurred an operating loss of $103,000 for the first
half of 2001 versus an operating loss of $154,000 in the prior year period. The
segment has cut back its pursuit of strategic alliances pending the issuance of
pending patent claims. The segment had no revenues in either the first half of
2001 or 2000 while pursuing the development of its technology.

Natural gas well servicing

     The operations of both of the companies comprising the WS Segment, which
conduct natural gas well servicing operations in northeastern Mexico, were
suspended in late January, 2000 after contracts with Petroleos Mexicanos
("Pemex") were not renewed. Assets of the 50%-owned well servicing company were
sold in May 2001 and that company's operations have been discontinued. Beard's
share of the operating losses from the discontinued company was $313,000 for the
first half of 2001 versus a loss of $528,000 for the same period in 2000. The
second quarter included a loss provision of $75,000 relating to the shutting
down of the operations of the natural gas well servicing company. The sand
separator company incurred an operating loss of $95,000 for the first half of
2001 compared to a loss of $76,000 for the same period in 2000.

Other corporate activities

     Other corporate activities include general and corporate operations, as
well as assets unrelated to the Company's operating segments or held for
investment. These activities generated operating losses of $466,000 for the
first half of 2001 as compared to $511,000 in the same period of 2000. Reasons
for the decreased loss include a reduction of $15,000 in benefit administration
costs, reductions in professional fees of $18,000, decreases in travel costs of
$7,000, and reductions in several other expense categories as the Company found
ways to reduce costs.

Selling, general and administrative expenses

     The Company's selling, general and administrative expenses ("SG&A") in the
first half of 2001 decreased to $670,000 from $817,000 for the 2000 six months.
The Coal Segment had a decrease in SG&A expenses of $25,000 due primarily to
reductions in staff and other expenses. The e-Commerce Segment incurred $53,000
less in SG&A costs as the segment scaled back its pursuit of strategic
alliances. The WS Segment incurred $19,000 less SG&A expenses for the six months
of 2001 compared to the same period of the prior year as the segment ceased
operations in Mexico while continuing to seek work for its sand separators in
south Texas. Other operations incurred approximately $19,000 less in SG&A for
the six months of 2001 compared to the same period in 2000 primarily as a result
of the decreased legal costs and by the reduction in other expenses discussed
above.

Depreciation, depletion and amortization expenses

     DD&A expense increased $18,000 from $53,000 for the six months ended June
30, 2000 to $71,000 for the same period in 2001. The increase was due to an
increase in the amount of equipment owned by the Company at June 30, 2001
compared to the same date in 2000 and includes an impairment of $14,000
associated with patent costs for the sand separator company in northeastern
Mexico.

Other income and expense

     The other income and expenses for the first six months of 2001 netted to a
loss of $54,000 compared to income of $228,000 for the same period in 2000.
Interest income was up $19,000 for the first half of 2001 compared to the same
period in 2000 as a result of increased amounts loaned to fund our partner's
operations in Mexico. Interest expense was up $88,000 as a result of the
increase in debt, primarily to a related party. The Company realized gains on
sale of assets for the first six months of 2001 totaling $68,000 versus $10,000
in the prior year period.

     The Company's equity in the operations of unconsolidated affiliates was a
loss of $106,000 for the first six months of 2001 compared to income of $148,000
for the same period in 2000. The Company's equity in the earnings of Cibola
decreased $73,000 from $144,000 for the first six months of 2000 to $71,000 for
the same period in 2001 reflecting Cibola's decline in operating results.
Through a wholly-owned subsidiary, the Company has signed contracts and formed
Cooperative Joint Ventures ("CJV's") or similar arrangements with various
Chinese partners for the construction of four facilities and the marketing and
sale of organic-chemical compound fertilizer ("OCCF") utilizing two types of
organic waste materials: sewage sludge and crop-residual agri-waste. The
personnel employed by the subsidiary devote all their time and energies to the
development of the business related to the technology utilized by the CJV's. The
Company's share of the losses from these operations was $177,000 for the first
six months of 2001.

Income taxes

     The Company recorded refunds of $41,000, $2,000 and $19,000 for federal,
foreign and state income taxes, respectively, in the first half of 2001 compared
to $14,000 in alternative minimum tax expense in the same period in 1999. The
Company has not recorded any financial benefit attributable to its various tax
carryforwards due to uncertainty regarding their utilization and realization.

Discontinued operations

     North American Brine Resources ("NABR")
     Complete details concerning the discontinuance of NABR are contained in
"Material changes in results of operations - Quarter ended June 30, 2001 as
compared with the Quarter ended June 30, 2000" under the "Discontinued
Operations - North American Brine Resources" heading.

     NABR's actual loss for the six months ended June 30, 2000 was $137,000, the
Company's share of which was charged against the loss accrual recorded in 1999.
Beard recorded a loss of $26,000 for the six months ended June 30, 2001 for net
operating expenses of the smaller of two plants distributed to the Company in
2000.  This loss was not anticipated in the loss accrual of 1999.

     ITF Segment
     Complete details concerning the discontinuance of the interstate travel
facilities ("ITF") Segment are contained in "Material changes in results of
operations - Quarter ended June 30, 2001 as compared with the Quarter ended June
30, 2000" under the "Discontinued Operations - ITF Segment" heading.

     ITF's revenues and actual operating losses were $1,118,000 and $149,000,
respectively, for the six months ended June 30, 2000. The actual losses for the
six months ended June 30, 2000 were charged against the loss accrual recorded in
the fourth quarter of 1999.

     ITF's revenues and actual operating losses were $7,000 and $37,000,
respectively, for the six months ended June 30, 2001. The actual losses for the
six months ended June 30, 2001 were charged against the loss accrual recorded in
the fourth quarter of 2000.

     ITS-TESTCO, L.L.C.
     Complete details concerning the discontinuance of the Company's natural gas
well testing operations in Mexico are contained in "Material changes in results
of operations - Quarter ended June 30, 2001 as compared with the Quarter ended
June 30, 2000" under the "Discontinued Operations - ITS-Testco, L.L.C." heading.

     ISITOP, Inc.
     Complete details concerning the discontinuance of the Company's
environmental remediation ("ER") Segment are contained in "Material changes in
results of operations - Quarter ended June 30, 2001 as compared with the Quarter
ended June 30, 2000" under the "Discontinued Operations - ISITOP, Inc." heading.

     ISITOP had no revenues for either of the six-month periods ended June 30,
2001 or 2000, respectively. The segment's operating losses were $17,000 and
$117,000 for the six months ended June 30, 2001 and 2000, respectively

Impact of Recently Issued Accounting Standards Not Yet Adopted

     In June 1998, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting for
Derivative Instruments and Hedging Activities." SFAS No.133 establishes
accounting and reporting standards for derivative instruments, including certain
recognition of all derivatives as either assets or liabilities in the balance
sheet and measurement of those instruments at fair value. If certain conditions
are met, a derivative may be specifically designated as a hedge. The accounting
for changes in the fair value of a derivative (that is, gains and losses)
depends on the intended use of the derivative and whether it qualifies as a
hedge. A subsequent pronouncement, SFAS 137, was issued in July, 1999, that
delayed the effective date of SFAS 133 until fiscal years beginning after June
15, 2000. In June 2000, the FASB issued SFAS No. 138, "Accounting for Certain
Derivative Instruments and Certain Hedging Activities", an amendment to SFAS No.
133. If the provisions of SFAS No. 133 and No. 138 were to be applied as of June
30, 2001, it would not have a material impact on the Company's financial
position as of such date, or the results of operations for the year then ended.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.

     At June 30, 2001, the Company had notes receivable of $616,000 and
long-term debt of $2,146,000. The notes receivable and $1,846,000 of the
long-term debt have fixed interest rates and therefore, the Company's interest
income and expense and operating results would not be affected by an increase in
market interest rates for these items. At June 30, 2001, a 10% increase in
market interest rates would have reduced the fair value of the Company's notes
receivable by $3,000 and reduced the fair value of its long-term debt by less
than $19,000. The remaining $300,000 of debt bears interest at a variable rate
which is one-half percent above Chase Manhattan prime rate. The Company's
interest expense would be increased by less than $1,000 as a result of a 10%
increase in interest rates on this variable rate debt.

     The Company has no other market risk sensitive instruments.

PART II.     OTHER INFORMATION.

Item 2.  Changes in Securities.

     The Company's preferred stock is mandatorily redeemable through December
31, 2002 from one-third of Beard's "consolidated net income" as defined in the
Stock Purchase Agreement. Accordingly, one-third of future "consolidated net
income" will accrete directly to preferred stockholders and reduce earnings per
common share. As a result of these redemption requirements, the payment of any
dividends to the common stockholders in the near future is very unlikely. See
Note 4 to the accompanying financial statements.

Item 4.  Submission of Matters to a Vote of Security Holders.

     Commencing on April 27, 2001, proxies were solicited on behalf of the Board
of Directors of the Company in connection with the Annual Meeting of
Stockholders.

     (a) The annual meeting was held on June 7, 2001.

     (b) The business of the meeting included the election of Harlon E. Martin,
Jr. and Herb Mee, Jr. to serve as directors for three year terms or until their
successors have been elected and qualified.

     In addition, the following persons continue to serve as directors for terms
expiring on the dates indicated or until their successors have been elected and
qualified:

W.M. Beard   (2002)      Allan R. Hallock   (2003)      Ford C. Price   (2003)

     In addition to the above, Michael E. Carr, elected in 1994 to serve as a
director by the preferred stockholders, will continue to serve until his
successor has been elected and qualified.

     The table below sets forth the voting for election of directors:

<TABLE>
<CAPTION>
                         Votes      Votes    Votes                    Broker
 Name of Nominee          For      Against  Withheld  Abstentions   Non-Votes
 ---------------          ---      -------  --------  -----------   ---------
<S>                     <C>          <C>     <C>         <C>         <C>
Harlon E. Martin, Jr.   1,700,719    -0-     123,812     -0-         111,408
Herb Mee, Jr.           1,700,719    -0-     123,812     -0-         111,408
</TABLE>

     (c) The business of the meeting also included a proposal to approve an
Amendment to The Beard Company Deferred Stock Compensation Plan which was
adopted by the Board of Directors in October 2000 subject to stockholder
approval. The table below sets forth the voting for such proposal:

                    Votes         Votes                      Broker
                     For         Against    Abstentions    Non-Votes
                     ---         -------    -----------    ---------
                  1,685,921      137,307       1,303        111,408

     (d) At the meeting the stockholders also voted to approve the appointment
of Cole & Reed, P.C. as independent certified public accountants for fiscal year
2001. The table below sets forth the voting for such proposal:

                   Votes          Votes                     Broker
                    For          Against    Abstentions    Non-Votes
                    ---          -------    -----------    ---------
                  1,823,262        37          1,232        111,408

Item 6.  Exhibits and Reports on Form 8-K.

(a)  The following exhibits are filed with this Form 10-Q and are identified by
     the numbers indicated:

2         Plan of acquisition, reorganization, arrangement, liquidation or
          succession:

2(a)      Agreement and Plan of Reorganization by and among Registrant, Beard
          Oil Company ("Beard Oil") and New Beard, Inc., dated as of July 12,
          1993 (see Addendum A to Part I, which is incorporated herein by
          reference; schedules to the Agreement have been omitted). (This
          Exhibit has been previously filed as Exhibit 3(b), filed on July 27,
          1993 to Registrant's Registration Statement on Form S-4, File No.
          33-66598, and same is incorporated herein by reference).

2(b)      Agreement and Plan of Merger by and between The Beard Company and The
          New Beard Company, dated as of September 16, 1997. (This Exhibit has
          been previously filed as Exhibit B to Registrant's Proxy Statement
          filed on September 12, 1997, and same is incorporated herein by
          reference).

2(c)      Certificate of Merger merging The Beard Company into The New Beard
          Company as filed with the Secretary of State of Oklahoma on November
          26, 1997. (This Exhibit has been previously filed as Exhibit 2.1 to
          Registrant's Form 8-K, filed on December 8, 1997, and same is
          incorporated herein by reference).

3(i)      Certificate of Incorporation of The New Beard Company as filed with
          the Secretary of State of Oklahoma on September 11, 1997. (This
          Exhibit has been previously filed as Exhibit C to Registrant's Proxy
          Statement filed on September 12, 1997, and same is incorporated herein
          by reference).

3(ii)     Registrant's By-Laws as currently in effect. (This Exhibit has been
          previously filed as Exhibit 3(ii) to Registrant's Form 10-K for the
          period ended December 31, 1997, filed on March 31, 1998, and same is
          incorporated herein by reference).

4         Instruments defining the rights of security holders:

4(a)      Certificate of Designations, Powers, Preferences and Relative,
          Participating, Option and Other Special Rights, and the
          Qualifications, Limitations or Restrictions Thereof of the Series A
          Convertible Voting Preferred Stock of the Registrant. (This Exhibit
          has been previously filed as Exhibit 3(c) to Amendment No. 2, filed on
          September 17, 1993 to Registrant's Registration Statement on Form S-4,
          File No. 33-66598, and same is incorporated herein by reference).

4(b)      Settlement Agreement, with Certificate of Amendment attached thereto,
          by and among Registrant, Beard Oil, New York Life Insurance Company,
          New York Life Insurance and Annuity Company, John Hancock Mutual Life
          Insurance Company, Memorial Drive Trust and Sensor, dated as of April
          13, 1995. (This Exhibit has been previously filed as Exhibit 4(g) to
          Registrant's Form 10-K for the period ended December 31, 1994 and same
          is incorporated herein by reference).

10        Material contracts:

10(a)     Amendment No. One to The Beard Company 1993 Stock Option Plan dated
          August 27, 1993, as amended June 4, 1998. (The Amended Plan supersedes
          the original Plan adopted on August 27, 1993. This Exhibit has
          previously been filed as Exhibit A, filed on April 30, 1998 to
          Registrant's Proxy Statement dated April 30, 1998, and same is
          incorporated herein by reference).*

10(b)     Form of Indemnification Agreement dated December 15, 1994, by and
          between Registrant and eight directors. (This Exhibit has been
          previously filed as Exhibit 10(b) to Registrant's Form 10-K for the
          period ended December 31, 2000, filed on April 2, 2001, and same is
          incorporated herein by reference).

10(c)     The Beard Company 1994 Phantom Stock Units Plan as amended effective
          October 23, 1997. (This Exhibit has been previously filed as Exhibit
          10(b) to Registrant's Form 10-K for the period ended December 31,
          1999, filed on April 14, 2000, and same is incorporated herein by
          reference).*

10(d)     Amendment No. Two to The Beard Company Deferred Stock Compensation
          Plan dated November 1, 1995, as amended June 7, 2001. (The Amended
          Plan supersedes the original Plan adopted on June 3, 1996, and amended
          on July 21, 1999. This Exhibit has previously been filed as Exhibit A,
          filed on April 19, 2001 to Registrant's Proxy Statement dated April
          19, 2001, and same is incorporated herein by reference).*

10(e)     Amended and Restated Nonqualified Stock Option Agreement by and
          between Richard D. Neely and ISITOP, Inc. ("ISITOP"), dated November
          12, 1998. (This Exhibit has been previously filed as Exhibit 10(g) to
          Registrant's Form 10-K for the period ended December 31, 1998, filed
          on April 15, 1999, and same is incorporated herein by reference).*

10(f)     Amended and Restated Nonqualified Stock Option Agreement by and
          between Jerry S. Neely and ISITOP, dated November 12, 1998. (This
          Exhibit has been previously filed as Exhibit 10(h) to Registrant's
          Form 10-K for the period ended December 31, 1998, filed on April 15,
          1999, and same is incorporated herein by reference).*

10(g)     Nonqualified Stock Option Agreement by and between Robert A. McDonald
          and ISITOP, dated November 12, 1998. . (This Exhibit has been
          previously filed as Exhibit 10(i) to Registrant's Form 10-K for the
          period ended December 31, 1998, filed on April 15, 1999, and same is
          incorporated herein by reference).*

10(h)     Incentive Stock Option Agreement by and between Philip R. Jamison and
          Beard Technologies, Inc. ("BTI"), dated May 18, 1998. (This Exhibit
          has been previously filed as Exhibit 10(k) to Registrant's Form 10-K
          for the period ended December 31, 1998, filed on April 15, 1999, and
          same is incorporated herein by reference).*

10(i)     Subscription Agreement by and between Cibola Corporation ("Cibola")
          and Registrant, dated April 10, 1996. (This Exhibit has been
          previously filed as Exhibit 10.1 to Registrant's Form 10-Q for the
          period ended June 30, 1996, filed on August 14, 1996, and same is
          incorporated herein by reference).

10(j)     Nonrecourse Secured Promissory Note from Registrant to Cibola, dated
          April 10, 1966. (This Exhibit has been previously filed as Exhibit
          10.2 to Registrant's Form 10-Q for the period ended June 30, 1996,
          filed on August 14, 1996, and same is incorporated herein by
          reference).

10(k)     Security Agreement by and among Registrant, Cibola and the Cibola
          shareholders, dated April 10, 1996. (This Exhibit has been previously
          filed as Exhibit 10.3 to Registrant's Form 10-Q for the period ended
          June 30, 1996, filed on August 14, 1996, and same is incorporated
          herein by reference).

10(l)     Tax Sharing Agreement by and among Registrant, Cibola and the Cibola
          shareholders, dated April 10, 1996. (This Exhibit has been previously
          filed as Exhibit 10.4 to Registrant's Form 10-Q for the period ended
          June 30, 1996, filed on August 14, 1996, and same is incorporated
          herein by reference).

10(m)     Guaranty Agreement between Registrant and Oklahoma Bank and Trust
          Company, dated as of June 7, 1999. (This Exhibit has been previously
          filed as Exhibit 10(bb) to Registrant's Form 10-Q for the period ended
          June 30, 1999, filed on August 20, 1999, and same is incorporated
          herein by reference).

10(n)     Letter Loan Agreement by and between Registrant and The William M.
          Beard and Lu Beard 1988 Charitable Unitrust (the " Unitrust") dated
          April 3, 2000. (This Exhibit has been previously filed as Exhibit
          10(cc) to Registrant's Form 10-K for the period ended December 31,
          1999, filed on April 14, 2000, and same is incorporated herein by
          reference).

10(o)     Amended Letter Loan Agreement by and between Registrant and the
          Unitrust dated September 1, 2000. (This Exhibit has been previously
          filed as Exhibit 10(o) to Registrant's Form 10-Q for the period ended
          September 30, 2000, filed on November 20, 2000, and same is
          incorporated herein by reference).

10(p)     Amended Letter Loan Agreement by and between Registrant and the
          Unitrust dated March 31, 2001. (This Exhibit has been previously filed
          as Exhibit 10(p) to Registrant's Form 10-Q for the period ended March
          31, 2001, filed on May 21, 2001, and same is incorporated herein by
          reference).

10(q)     Amended Letter Loan Agreement by and between Registrant and the
          Unitrust dated June 30, 2001.

10(r)     Promissory Note from Registrant to the Trustees of the Unitrust dated
          April 3, 2000. (This Exhibit has been previously filed as Exhibit
          10(dd) to Registrant's Form 10-K for the period ended December 31,
          1999, filed on April 14, 2000, and same is incorporated herein by
          reference).

10(s)     Renewal Promissory Note from Registrant to the Trustees of the
          Unitrust dated September 1, 2000. (This Exhibit has been previously
          filed as Exhibit 10(q) to Registrant's Form 10-Q for the period ended
          September 30, 2000, filed on November 20, 2000, and same is
          incorporated herein by reference).

10(t)     Promissory Note from Registrant to the Trustees of the Unitrust dated
          October 20, 2000. (This Exhibit has been previously filed as Exhibit
          10(w) to Registrant's Form 10-K for the period ended December 31,
          2000, filed on April 2, 2001, and same is incorporated herein by
          reference).

10(u)     Renewal Promissory Note from Registrant to the Trustees of the
          Unitrust dated March 31, 2001. (This Exhibit has been previously filed
          as Exhibit 10(t) to Registrant's Form 10-Q for the period ended March
          31, 2001, filed on May 21, 2001, and same is incorporated herein by
          reference).

10(v)     Renewal Promissory Note from Registrant to the Trustees of the
          Unitrust dated June 30, 2001.

10(w)     Promissory Note from Registrant to Bank of Oklahoma, N.A. ("BOK")
          dated August 30, 2000. (This Exhibit has been previously filed as
          Exhibit 10(r) to Registrant's Form 10-Q for the period ended September
          30, 2000, filed on November 20, 2000, and same is incorporated herein
          by reference).

10(x)     Extension Promissory Note from Registrant to BOK dated September 30,
          2000. (This Exhibit has been previously filed as Exhibit 10(s) to
          Registrant's Form 10-Q for the period ended September 30, 2000, filed
          on November 20, 2000, and same is incorporated herein by reference).

10(y)     Extension Promissory Note from Registrant to BOK dated March 15, 2001.
          (This Exhibit has been previously filed as Exhibit 10(w) to
          Registrant's Form 10-Q for the period ended March 31, 2001, filed on
          May 21, 2001, and same is incorporated herein by reference).

10(z)     Extension Promissory Note from Registrant to BOK dated June 30,
          2001.

10(aa)    Guaranty Agreement between the Unitrust and BOK dated August 30, 2000.
          (This Exhibit has been previously filed as Exhibit 10(t) to
          Registrant's Form 10-Q for the period ended September 30, 2000, filed
          on November 20, 2000, and same is incorporated herein by reference).

10(bb)    Guaranty Agreement between W. M. Beard and BOK dated August 30, 2000.
          (This Exhibit has been previously filed as Exhibit 10(u) to
          Registrant's Form 10-Q for the period ended September 30, 2000, filed
          on November 20, 2000, and same is incorporated herein by reference).

10(cc)    Asset Purchase and Sale Agreement among Testco Inc. de Mexico, S.A. de
          C.V. and ITS-Testco, LLC and PD Oilfield Services Mexicana, S. de R.L.
          de C.V., dated May 4, 2001. (This Exhibit has been previously filed as
          Exhibit 10(z) to Registrant's Form 10-Q for the period ended March 31,
          2001, filed on May 21, 2001, and same is incorporated herein by
          reference).

10(dd)    Asset Purchase and Sale Agreement between ITS-Testco, LLC and
          Inter-Tech Drilling Solutions, Inc., dated May 4, 2001. (This Exhibit
          has been previously filed as Exhibit 10(aa) to Registrant's Form 10-Q
          for the period ended March 31, 2001, filed on May 21, 2001, and same
          is incorporated herein by reference).

---------------

*   Compensatory plan or arrangement.

     The Company will furnish to any shareholder a copy of any of the above
exhibits upon the payment of $.25 per page. Any request should be sent to The
Beard Company, Enterprise Plaza, Suite 320, 5600 North May Avenue, Oklahoma
City, Oklahoma 73112.

(b)  No reports on Form 8-K were filed during the period covered by this report.

<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                        (Registrant)   THE BEARD COMPANY

                                           /s/ Herb Mee, Jr.
     (Date)   August 14, 2001              Herb Mee, Jr., President and
                                           Chief Financial Officer

                                           /s/ Jack A. Martine
     (Date)   August 14, 2001              Jack A. Martine, Controller and
                                           Chief Accounting Officer

<PAGE>
<TABLE>
                               INDEX TO EXHIBITS
<CAPTION>
Exhibit
No.         Description                           Method of Filing
---         -----------                           ----------------
<S>       <C>                                   <C>
2(a)      Agreement and Plan of                 Incorporated herein by reference
          Reorganization by and among
          Registrant, Beard Oil Company
          ("Beard Oil") and New Beard, Inc.,
          dated as of July 12, 1993

2(b)      Agreement and Plan of Merger by and   Incorporated herein by reference
          between The Beard Company and The
          New Beard Company, dated as of
          September 16, 1997.

2(c)      Certificate of Merger merging The     Incorporated herein by reference
          Beard Company into The New Beard
          Company as filed with the Secretary
          of State of Oklahoma on November
          26, 1997.

3(i)      Certificate of Incorporation of The   Incorporated herein by reference
          New Beard Company as filed with the
          Secretary of State of Oklahoma on
          September 11, 1997.

3(ii)     Registrant's By-Laws as currently     Incorporated herein by reference
          in effect.

4(a)      Certificate of Designations,          Incorporated herein by reference
          Powers, Preferences and Relative,
          Participating, Option and Other
          Special Rights, and the
          Qualifications, Limitations or
          Restrictions Thereof of the Series
          A Convertible Voting Preferred
          Stock of the Registrant.

4(b)      Settlement Agreement, with            Incorporated herein by reference
          Certificate of Amendment attached
          thereto, by and among Registrant,
          Beard Oil, New York Life Insurance
          Company, New York Life Insurance
          and Annuity Company, John Hancock
          Mutual Life Insurance Company,
          Memorial Drive Trust and Sensor,
          dated as of April 13, 1995.

10(a)     Amendment No. One to The Beard        Incorporated herein by reference
          Company 1993 Stock Option Plan
          dated August 27, 1993, as amended
          June 4, 1998.

10(b)     Form of Indemnification Agreement     Incorporated herein by reference
          dated December 15, 1994, by and
          between Registrant and eight
          directors.

10(c)     The Beard Company 1994 Phantom        Incorporated herein by reference
          Stock Units Plan as amended
          effective October 23, 1997.

10(d)     Amendment No. One to The Beard        Incorporated herein by reference
          Company Deferred Stock Compensation
          Plan dated November 1, 1995, as
          amended July 21, 1999.

10(e)     Amended and Restated Nonqualified     Incorporated herein by reference
          Stock Option Agreement by and
          between Richard D. Neely and
          ISITOP, Inc. ("ISITOP"), dated
          November 12, 1998.

10(f)     Amended and Restated Nonqualified     Incorporated herein by reference
          Stock Option Agreement by and
          between Jerry S. Neely and ISITOP,
          dated November 12, 1998.

10(g)     Nonqualified Stock Option Agreement   Incorporated herein by reference
          by and between Robert A. McDonald
          and ISITOP, dated November 12,
          1998.

10(h)     Incentive Stock Option Agreement by   Incorporated herein by reference
          and between Philip R. Jamison and
          Beard Technologies, Inc. ("BTI"),
          dated May 18, 1998.

10(i)     Subscription Agreement by and         Incorporated herein by reference
          between Cibola Corporation
          ("Cibola") and Registrant, dated
          April 10, 1996.

10(j)     Nonrecourse Secured Promissory Note   Incorporated herein by reference
          from Registrant to Cibola, dated
          April 10, 1966.

10(k)     Security Agreement by and among       Incorporated herein by reference
          Registrant, Cibola and the Cibola
          shareholders, dated April 10, 1996.

10(l)     Tax Sharing Agreement by and among    Incorporated herein by reference
          Registrant, Cibola and the Cibola
          shareholders, dated April 10, 1996.

10(m)     Guaranty Agreement between            Incorporated herein by reference
          Registrant and Oklahoma Bank and
          Trust Company, dated as of June 7,
          1999.

10(n)     Letter Loan Agreement by and          Incorporated herein by reference
          between Registrant and The William
          M. Beard and Lu Beard 1988
          Charitable Unitrust (the
          "Unitrust") dated April 3, 2000.

10(o)     Amended Letter Loan Agreement by      Incorporated herein by reference
          and between Registrant and the
          Unitrust dated September 1, 2000.

10(p)     Amended Letter Loan Agreement by      Incorporated herein by reference
          and between Registrant and the
          Unitrust dated March 31, 2001.

10(q)     Amended Letter Loan Agreement by      Filed herewith electronically
          and between Registrant and the
          Unitrust dated June 30, 2001

10(r)     Promissory Note from Registrant to    Incorporated herein by reference
          the Trustees of the Unitrust dated
          April 3, 2000.

10(s)     Renewal Promissory Note from          Incorporated herein by reference
          Registrant to the Trustees of the
          Unitrust dated September 1, 2000.

10(t)     Promissory Note from Registrant to    Incorporated herein by reference
          the Trustees of the Unitrust dated
          October 20, 2000.

10(u)     Renewal Promissory Note from          Incorporated herein by reference
          Registrant to the Trustees of the
          Unitrust dated March 31, 2001.

10(v)     Renewal Promissory Note from          Filed herewith electronically
          Registrant to the Trustees of the
          Unitrust dated June 30, 2001

10(w)     Promissory Note from Registrant to    Incorporated herein by reference
          Bank of Oklahoma, N.A. ("BOK")
          dated August 30, 2000.

10(x)     Extension Promissory Note from        Incorporated herein by reference
          Registrant to BOK dated September
          30, 2000.

10(y)     Extension Promissory Note from        Incorporated herein by reference
          Registrant to BOK dated March 15,
          2001.

10(z)     Extension Promissory Note from        Filed herewith electronically
          Registrant to BOK dated June 30,
          2001.

10(aa)    Guaranty Agreement between the        Incorporated herein by reference
          Unitrust and BOK dated August 30,
          2000.

10(bb)    Guaranty Agreement between W. M.      Incorporated herein by reference
          Beard and BOK dated August 30,
          2000.

10(cc)    Asset Purchase and Sale Agreement     Incorporated herein by reference
          among Testco Inc. de Mexico, S.A.
          de C.V. and ITS-Testco, LLC and PD
          Oilfield Services Mexicana, S. de
          R.L. de C.V., dated May 4, 2001.

10(dd)    Asset Purchase and Sale Agreement     Incorporated herein by reference
          between ITS-Testco, LLC and
          Inter-Tech Drilling Solutions, Inc.,
          dated May 4, 2001.
</TABLE>