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 September 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 October 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 - September 30, 2001 (Unaudited) and
       December 31, 2000.................................................3

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

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

    Statements of Cash Flows - Nine Months ended
       September 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 6.  Exhibits and Reports on Form 8-K...............................24

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

<PAGE>
Item 1. Financial Statements
<TABLE>
                                THE BEARD COMPANY AND SUBSIDIARIES
                                          Balance Sheets
                       September 30, 2001 (Unaudited) and December 31, 2000
<CAPTION>
                                                                     September 30,      December 31,
                              Assets                                     2001                2000
                              ------                                     ----                ----
<S>                                                                <C>                <C>
Current assets:
         Cash and cash equivalents                                 $     32,000       $     31,000
         Accounts receivable, less allowance for doubtful
            receivables of $292,000 in 2001 and 2000                    166,000            337,000
         Inventory                                                       78,000            129,000
         Prepaid expenses and other assets                               22,000             39,000
         Current portion of notes receivable                            543,000             80,000
                                                                   ------------       ------------
                           Total current assets                         841,000            616,000
                                                                   ------------       ------------

Notes receivable                                                        463,000            789,000

Investments and other assets                                            192,000            467,000

Property, plant and equipment, at cost                                5,320,000          5,364,000
         Less accumulated depreciation, depletion and amortization    2,291,000          2,198,000
                                                                   ------------       ------------
                           Net property, plant and equipment          3,029,000          3,166,000
                                                                   ------------       ------------

Intangible assets, at cost                                               58,000             50,000
         Less accumulated amortization                                   16,000              1,000
                                                                   ------------       ------------
                           Net intangible assets                         42,000             49,000
                                                                   ------------       ------------
                                                                   $  4,567,000       $  5,087,000
                                                                   ============       ============


                            Liabilities and Shareholders' Equity
                            ------------------------------------

Current liabilities:
         Trade accounts payable                                    $    107,000       $    167,000
         Accrued expenses                                               409,000            578,000
         Current maturities of long-term debt                           306,000             30,000
                                                                   ------------       ------------
                           Total current liabilities                    822,000            775,000
                                                                   ------------       ------------
Long-term debt less current maturities                                   21,000            347,000

Long-term debt - related entities                                     2,312,000          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                              38,055,000         37,986,000
         Accumulated deficit                                        (35,769,000)       (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            415,000          1,883,000
                                                                   ------------       ------------
Commitments and contingencies (note 7)
                                                                   $  4,567,000       $  5,087,000
                                                                   ============       ============
</TABLE>

See accompanying notes to financial statements.


<TABLE>
                                               THE BEARD COMPANY AND SUBSIDIARIES
                                                    Statements of Operations
                                                          (Unaudited)
<CAPTION>
                                                                  For Three Months Ended           For Nine Months Ended
                                                                  ----------------------           ---------------------
                                                               September 30,   September 30,    September 30,    September 30,
                                                                   2001            2000            2001              2000
                                                               -------------   -------------    -------------    -------------
<S>                                                             <C>             <C>             <C>              <C>
Revenues:
     Coal reclamation                                           $   23,000      $   61,000      $   120,000      $    84,000
     Carbon dioxide                                                100,000         125,000          342,000          338,000
     China                                                               -               -                -                -
     e-Commerce                                                          -               -                -                -
     Other                                                           6,000           6,000           18,000           21,000
                                                                ----------      ----------      -----------      -----------
                                                                   129,000         192,000          480,000          443,000
                                                                ----------      ----------      -----------      -----------
Expenses:
     Coal reclamation                                              135,000         133,000          395,000          492,000
     Carbon dioxide                                                 28,000          33,000           73,000           69,000
     China                                                               -          78,000                -          268,000
     e-Commerce                                                          -               -                -                -
     Selling, general and administrative                           288,000         314,000          904,000        1,050,000
     Depreciation, depletion & amortization                         24,000          23,000           68,000           64,000
     Other                                                           3,000               -           20,000           22,000
                                                                ----------      ----------      -----------      -----------
                                                                   478,000         581,000        1,460,000        1,965,000
                                                                ----------      ----------      -----------      -----------
Operating profit (loss):
     Coal reclamation                                             (143,000)        (97,000)        (385,000)        (535,000)
     Carbon dioxide                                                 64,000          84,000          244,000          245,000
     China                                                               -        (100,000)               -         (291,000)
     e-Commerce                                                    (34,000)        (61,000)        (137,000)        (215,000)
     Other, primarily corporate                                   (236,000)       (215,000)        (702,000)        (726,000)
                                                                ----------      ----------      -----------      -----------
                                                                  (349,000)       (389,000)        (980,000)      (1,522,000)
Other income (expense):
     Interest income                                                54,000          41,000          130,000           98,000
     Interest expense                                              (56,000)        (22,000)        (144,000)         (30,000)
     Equity in operations of unconsolidated affiliates             (50,000)         65,000         (156,000)         213,000
     Gain on sale of assets                                         11,000         196,000           79,000          206,000
     Minority interest in operations of subsidiary                       -               -                -           16,000
     Other                                                          (1,000)          4,000            5,000           10,000
                                                                ----------      ----------      -----------      -----------
Loss from continuing operations before income taxes               (391,000)       (105,000)      (1,066,000)      (1,009,000)
Income taxes (note 6)                                                    -               -           60,000          (14,000)
                                                                ----------      ----------      -----------      -----------
Loss from continuing operations                                   (391,000)       (105,000)      (1,006,000)      (1,023,000)

     Loss from discontinued operations                             (58,000)       (386,000)        (516,000)      (1,112,000)
                                                                ----------      ----------      -----------      -----------
Net loss                                                        $ (449,000)     $ (491,000)     $(1,522,000)     $(2,135,000)
                                                                ==========      ==========      ===========      ===========

Net loss per average common share outstanding:
     Basic and diluted:
        Loss from continuing operations                         $    (0.21)     $    (0.06)     $     (0.55)     $     (0.56)
        Loss from discontinued operations                            (0.03)          (0.21)           (0.28)           (0.61)
                                                                ----------      ----------      -----------      -----------
        Net loss                                                $    (0.24)     $    (0.27)     $     (0.83)     $     (1.17)
                                                                ==========      ==========      ===========      ===========


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.

<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, nine months ended September
    30, 2001 (unaudited)                          -              -      (1,522,000)            -              -       (1,522,000)
  Comprehensive income:
    Foreign currency translation
      adjustment (unaudited)                      -              -               -       (15,000)             -          (15,000)
                                                                                                                    ------------
  Comprehensive loss (unaudited)                  -              -               -             -              -       (1,537,000)
                                                                                                                    ------------
  Reservation of shares pursuant to
    deferred compensation plan
    (unaudited)                                   -         69,000               -             -              -           69,000
                                           --------   ------------   -------------    ----------   ------------    -------------
Balance, September 30, 2001 (unaudited)    $  3,000   $ 38,055,000   $( 35,769,000)   $(  28,000)  $( 1,846,000)   $     415,000
                                           ========   ============   =============    ==========   ============    =============
</TABLE>

See accompanying notes to financial statements.

<TABLE>
                                      THE BEARD COMPANY AND SUBSIDIARIES
                                           Statements of Cash Flows
                                                 (Unaudited)
<CAPTION>
                                                                        For the Nine Months Ended
                                                                        -------------------------
                                                                September 30, 2001        September 30, 2000
                                                                ------------------        ------------------
<S>                                                              <C>                      <C>
Operating activities:
      Cash received from customers                               $     646,000            $     2,167,000
      Cash paid to suppliers and employees                          (1,841,000)                (4,073,000)
      Interest received                                                107,000                     74,000
      Interest paid                                                    (98,000)                   (32,000)
      Taxes received (paid)                                             60,000                    (20,000)
                                                                 -------------            ---------------
           Net cash used in operating activities                    (1,126,000)                (1,884,000)
                                                                 -------------            ---------------

Investing activities:
      Acquisition of property, plant and equipment                     (71,000)                  (268,000)
      Proceeds from sale of assets                                     162,000                    424,000
      Proceeds from redemptions of certificates of deposit                   -                    280,000
      Distribution from partnership                                          -                    230,000
      Investment in and advances to fifty percent-owned
         subsidiary                                                   (418,000)                  (343,000)
      Advances for notes receivable                                   (707,000)                  (302,000)
      Payments on notes receivable                                     979,000                    143,000
      Other                                                              6,000                    212,000
                                                                 -------------            ---------------
           Net cash provided by (used in) investing activities         (49,000)                   376,000
                                                                 -------------            ---------------

Financing activities:
      Payments on line of credit and term notes                       (387,000)                   (63,000)
      Proceeds from notes                                            1,563,000                  1,025,000
                                                                 -------------            ---------------
        Net cash provided by financing activities                    1,176,000                    962,000
                                                                 -------------            ---------------

Net increase (decrease) in cash and cash equivalents                     1,000                   (546,000)

Cash and cash equivalents at beginning of period                        31,000                    767,000
                                                                 -------------            ---------------
Cash and cash equivalents at end of period                       $      32,000            $       221,000
                                                                 =============            ===============
</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 Nine Months Ended
                                                                        -------------------------
                                                                 September 30, 2001       September 30, 2000
                                                                 ------------------       ------------------
<S>                                                               <C>                      <C>
Net loss                                                          $    (1,522,000)         $    (2,135,000)
Adjustments to reconcile net loss to net cash
 used in operating activities:
      Depreciation, depletion and amortization                            107,000                   82,000
      Gain on sale of assets                                              (96,000)                (206,000)
      Equity in net loss of unconsolidated affiliates                     468,000                  584,000
      Net cash used by discontinued operations offsetting
        accrued impairment loss                                           (44,000)                (180,000)
      Minority interest in operations of consolidated subsidiary                -                  (16,000)
      Noncash compensation expense                                              -                    6,000
      Other                                                                     -                    1,000
      (Increase) decrease in accounts receivable, prepaid
        expenses and other current assets                                  47,000                  (63,000)
      Decrease in inventories                                              51,000                    1,000
      Increase (decrease)in accounts payable, accrued
        expenses and other liabilities                                   (137,000)                  42,000
                                                                  ---------------          ---------------
      Net cash used in operating activities                       $    (1,126,000)         $    (1,884,000)
                                                                  ===============          ===============

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.

                       THE BEARD COMPANY AND SUBSIDIARIES
                          Notes to Financial Statements

                           September 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 accounting principles generally accepted in the United
     States 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 nine month periods ended
     September 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, and (4) the e-Commerce
     ("e-Commerce") Segment.

     The Coal Segment is in the business of operating coal fines reclamation
     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 environmental opportunities and the sale of technical services 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.

     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); (2) in December 1999 the Management Committee
     of North American Brine Resources ("NABR") adopted a plan to discontinue
     its brine extraction/iodine manufacturing business which comprised the
     Company's ("BE/IM") Segment; (3) in March 2001 the Company ceased providing
     financial support to its environmental remediation ("ER") subsidiary, its
     exclusive marketing license was subsequently cancelled, and the ER Segment
     was discontinued; and (4) in May 2001 the fixed assets of the 50%-owned
     company (accounted for as an equity investment) involved in the Natural Gas
     Well Servicing ("WS") Segment were sold and in August 2001, the Company
     ceased pursuing opportunities in Mexico and the segment was discontinued.

     Reclassifications
     Certain 2000 balances have been reclassified to conform to the 2001
     presentation.

(2)  Liquidity and Ability to Fund Operations
     Despite continuing operating losses during the past 12 months, the
     Company's cash and cash equivalents increased slightly from $31,000 at
     December 31, 2000 to $32,000 at September 30, 2001. To mitigate potential
     liquidity problems, the Company obtained financing of $1.8 million in 2000,
     and an additional $850,000 in the first nine months of 2001. $2.35 million
     of such funding were from affiliates 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 $178,000 during the first nine months of 2001. To
     further bolster working capital, the Company is also currently pursuing a
     $200,000 increase in its bank line of credit.

     The Company is focusing on replacing its Coal Segment's revenues and is
     currently working on four new pond reclamation projects, two of which are
     expected to mature into operating projects for the segment by mid-year
     2002. 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 second quarter of 2002. 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 nine months to complete. If we are the successful
     bidder, this phase is expected to commence in the first quarter of 2002.
     Bidding on the third project will occur this month. Discussions are
     underway in connection with the fourth project; if we should end up as the
     successful bidder, this project is expected to commence in the first
     quarter of 2002.

     Meanwhile, the outlook for the China Segment has brightened considerably.
     Three years of development activity are finally starting to bear fruit. The
     segment has active contracts and has formed Cooperative Joint Ventures
     ("CJV's") or similar arrangements with various Chinese partners for the
     construction of two 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 of this year, construction commenced in late May and the plant
     is expected to be completed in June, 2002. If the China Segment is able to
     meet its revised timetable for the construction of the two composting
     plants, it is expected to generate positive cash flow in the first half of
     2002 and the Company will no longer need to infuse capital to subsidize the
     segment's ongoing operations.

     The Company expects that present working capital, coupled with the cash
     expected to be generated from the sale of assets and funds available on its
     existing lines of credit will be sufficient to continue operations through
     2001 and until the operations of the contemplated coal projects have come
     on stream. In addition, fees generated in China by the new plant already
     under construction and from two additional plants expected to be started in
     the first quarter of 2002 are anticipated to generate significant cash flow
     which is expected to become available in 2002.

(3)  Discontinued Operations
     BE/IM Segment
     In December 1999, the Management Committee of 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 nine month periods ended September 30,
     2000 were losses of $139,000 and $276,000, 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 nine month periods ended
     September 30, 2001 were losses of $2,000 and $45,000, respectively, which
     were charged against the loss accrual recorded in 1999. In addition, the
     Company recorded losses of $22,000 and $48,000 for the three and nine month
     periods ended September 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 September 30, 2001, the significant assets related to NABR's
     operations consisted primarily of equipment and inventory with estimated
     net realizable values of $70,000 and $78,000, respectively. The liabilities
     related to NABR's operations consisted primarily of accounts payable of
     $7,000 and accrued expenses of $178,000. The Company is actively pursuing
     opportunities to sell NABR's assets and expects the disposition to be
     completed by March 31, 2002.

     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 month 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 September 30, 2001 while recording
     revenues of $7,000 for the nine month period ended September 30, 2001.
     ITF's actual operating losses for the three and nine month periods ended
     September 30, 2001 were $7,000 and $44,000, respectively. Such losses were
     charged against the loss accrual recorded in the fourth quarter of 2000.

     As of September 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 $21,000. Beard is
     actively seeking opportunities to sell the remaining C-stores and expects
     them to be sold by mid-year 2002.

     WS Segment
     In May 2001 the fixed assets of the 50%-owned company (accounted for as an
     equity investment) involved in natural gas well testing operations for the
     Natural Gas Well Servicing ("WS") Segment were sold for $1,550,000, subject
     to a hold back of $150,000. $21,000 of the hold back was received in June
     2001. As a result of the sale all debt of the 50%-owned company was retired
     and the Company was relieved of contingent liabilities totaling $512,000.
     In August 2001 the Company made the decision to cease pursuing
     opportunities in Mexico and the WS Segment was discontinued. The Company is
     now pursuing the sale of all remaining equipment owned by the segment.

     Beard's share of operating losses from the discontinued segment was
     $36,000 and $451,000, respectively for the three and nine month periods
     ending September 30, 2001. The nine month period included a provision of
     $175,000 for estimated losses from the discontinuation of operations.
     Actual operating losses of $25,000 for the three months ending September
     30, 2001 were charged against the impairment reserve established above. The
     remaining $10,000 of losses for the three months ending September 30, 2001
     were associated with the operations of the sand separator company and were
     not anticipated in the loss accrual. Beard's share of operating losses from
     the discontinued segment was $322,000 and $931,000, respectively for the
     three and nine month periods ending September 30, 2000.

     As of September 30, 2001 the WS Segment had cash of $40,000 and accounts
     receivable totaling $99,000. The remaining equipment consisted of five sand
     separators and a number of tanks having a total recorded value of $357,000.
     The significant liabilities of the segment consisted of taxes payable,
     trade accounts payable and other accrued expenses totaling $104,000. It is
     anticipated that all liabilities of the segment will be paid off prior to
     year-end 2001 and that the companies in the segment 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 none and $17,000 for the third quarter and nine months of 2001,
     respectively. The operating losses totaled $14,000 and $131,000 for the
     three and nine month periods of 2000, respectively. ISITOP had no
     significant assets or liabilities at September 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 September 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
     $17,000 for federal, foreign and state income taxes, respectively, for the
     nine months ended September 30, 2001. The provision for income taxes for
     the three and nine months ended September 30, 2000 consist of federal
     alternative minimum tax of none and $14,000, respectively.

     At September 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         $ 52,600

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 September 30, 2001, the accrued tax liabilities were
     estimated to be $8,000, with the Company liable for one-half of such
     amount. The Company is fully liable for accrued tax liabilities estimated
     to be $29,000 related to the wholly-owned sand separator company.

     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 nine months of 2001
     and 2000: Coal, Carbon Dioxide, China and e-Commerce.

     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
     environmental opportunities and the sale of technical services. The
     e-Commerce Segment is pursuing the development of a proprietary
     Internet-only payment system.

     The following is certain financial information regarding the Company's
     reportable segments (presented in thousands of dollars).

     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
                                  Coal    Dioxide      China      e-Commerce  Totals
                                  ----    -------      -----      ----------  ------
<S>                             <C>       <C>           <C>         <C>       <C>
 Three months ended
 ------------------
 September 30, 2001
 ------------------
Revenues from
  external  customers           $   23    $  100        $   -       $   -     $  123
Segment profit (loss)             (144)       63          (72)        (34)      (187)

 Three months ended
 ------------------
 September 30, 2000
 ------------------
Revenues from
  external  customers           $   61    $  125        $   -       $   -     $  186
Segment profit (loss)              (97)       84         (100)        (61)      (174)

 Nine months ended
 ------------------
 September 30, 2001
 ------------------
Revenues from
  external  customers           $  120    $  342        $   -       $   -     $  462
Segment profit (loss)             (387)      244         (250)       (139)      (532)
Segment assets                   1,647       432            -          61      2,140

 Nine months ended
 ------------------
 September 30, 2000
 ------------------
Revenues from
  external  customers           $   84    $  338        $   -       $   -     $  422
Segment profit (loss)             (537)      245         (291)       (215)      (798)
Segment assets                   1,699       455            -          59      2,213
</TABLE>

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

<TABLE>
<CAPTION>
                                          For the Three Months Ended                For the Nine Months Ended
                                       -------------------------------------  -----------------------------------
                                        September 30,     September 30,        September 30,       September 30,
                                             2001             2000                 2001                 2000
                                       -------------------------------------  -------------------------------------
     <S>                                <C>               <C>                 <C>                  <C>
     Total loss for reportable
       segments                         $  (187)          $  (174)            $  (532)             $  (798)
     Net corporate costs not
     allocated to segments                 (204)               69                (534)                (211)
                                       -------------------------------------  -------------------------------------
     Total consolidated loss from
       continuing operations before
       income taxes                     $  (391)          $  (105)           $ (1,066)            $ (1,009)
                                       =====================================  =====================================
</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 September 30, 2001 compared to the prior year third quarter and
the nine months ended September 30, 2001 compared to the prior year nine 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
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
environmental opportunities and the sale of technical services in China. The
e-Commerce Segment consists of a subsidiary which is pursuing the development of
a proprietary Internet-only payment system.

     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. In May 2001 the fixed assets of the 50%-owned company
(accounted for as an equity investment) involved in the WS Segment were sold. In
August 2001 the Company ceased pursuing opportunities in Mexico related to the
sand separator assets previously operated in Mexico in the WS Segment, and the
Company has since been pursuing the sale of the segment's remaining assets. As a
result, the operations of the WS Segment have now been reflected as
discontinued.


Material changes in financial condition - September 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>
                          September 30,    December 31,    Increase
                              2001            2000        (Decrease)
                              ----            ----        ----------
<S>                         <C>            <C>            <C>
Cash and cash equivalents   $  32,000      $  31,000      $   1,000

Working capital             $  19,000      $(159,000)     $ 178,000

Current ratio               1.02 to 1      0.79 to 1
</TABLE>

     During the first nine months of 2001, the Company increased its working
capital by $178,000 from $(159,000) as of December 31, 2000. Entities related to
the Chairman of the Board advanced $1,183,000 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. $368,000 of working capital were used to help
fund the operations of the Coal Segment. There were net advances of $71,000 to
the Company's joint venture involved in natural gas well testing in northeastern
Mexico. The Company received payments on notes receivable totaling $979,000
during the nine months ended September 30, 2001. $250,000 and $139,000,
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 is focusing on replacing its Coal Segment's revenues and is
currently working on four new pond reclamation projects, two of which are
expected to mature into operating projects for the segment by mid-year 2002. 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 second quarter of
2002. 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 nine months to complete. If the
Company is the successful bidder, this phase is expected to commence in the
first quarter of 2002. Bidding on the third project will occur this month.
Discussions are underway in connection with the fourth project; if we should end
up as the successful bidder, this project is expected to commence in the first
quarter of 2002. There is no assurance that the Company will be the successful
bidder on any of these projects.

     Meanwhile, the outlook for the China Segment has brightened considerably.
Three years of development activity are finally starting to bear fruit. The
segment has active contracts and has formed Cooperative Joint Ventures ("CJV's")
or similar arrangements with various Chinese partners for the construction of
two 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 of this year,
construction commenced in late May and the plant is expected to be completed in
June, 2002. If the China Segment is able to meet its revised timetable for the
construction of the two composting plants, it is expected to generate positive
cash flow in the first half of 2002, 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 projects we're working on has been determined.
Meanwhile, the Company's $300,000 bank line of credit together with the $2.25
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 $200,000 increase in its bank line of credit. 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
fourth 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 $970,000 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, and demand for the
Company's secure payment system for Internet transactions. The Company expects
that present working capital, coupled with the cash expected to be generated
from the sale of assets and funds available on its existing lines of credit will
be sufficient to continue operations through 2001 and until the operations of
the contemplated coal projects have come on stream. In addition, cash flow from
fees generated in China by the new plant already under construction and from two
additional plants expected to be started in the first quarter of 2002 are
anticipated to generate significant cash flow which is expected to become
available in 2002. However, until agreements have been negotiated in connection
with the third plant, there is no assurance that the fees from such plant will
materialize.

     Additionally, a Settlement Agreement has been signed by the attorneys for
the Plaintiffs in the McElmo Dome Litigation. At a Preliminary Hearing held on
November 14, 2001, the Court considered the proposed settlement, conditionally
certified the three proposed Classes in the settlement, conditionally certified
that the proposed settlement amount is adequate, and approved the selection of
the expert who will provide the fairness opinion in connection with the
settlement. A Final Hearing is scheduled to be held on February 11, 2002, to
determine whether (i) the settlement is fair and reasonable, and (ii) the
allocation between the Classes is fair and reasonable. In the meantime all
parties in the case have agreed that the settlement, the agreement, and the
terms and provisions thereof shall be maintained as confidential except as
required by applicable regulation.

     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 September 30, 2001 as
compared with the Quarter ended September 30, 2000.

     The net loss for the quarter ended September 30, 2001 was $449,000,
compared to a net loss of $491,000 for the third quarter of the prior year.
Discontinued operations accounted for $58,000 of the loss in the third quarter
of 2001 compared to $386,000 for the same period in 2000. The Coal Segment
reported a $46,000 increase in operating loss for the quarter. The CO2 Segment
had a $20,000 decrease in its operating margin due primarily to a decrease in
revenue from its interests in the McElmo Dome field as a result of a decrease in
price for CO2. The China Segment reflected an operating loss of $100,000 for the
third 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 $85,000 for the third quarter of 2001. The new e-Commerce Segment
incurred operating losses of $34,000 for the third quarter of 2001 compared to
$61,000 in the third quarter of 2000. The operating loss in Other activities for
the third quarter of 2001 increased $21,000 compared to the same period in 2000.
As a result, the operating loss in the third quarter of 2001 was $40,000 smaller
than in the same period of 2000.

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

<TABLE>
<CAPTION>
                                                2001               2000
                                           ---------------    --------------
<S>                                        <C>                <C>
         Operating profit (loss):
           Coal reclamation                $     (143,000)    $     (97,000)
           Carbon dioxide                          64,000            84,000
           China                                        -          (100,000)
           e-Commerce                             (34,000)          (61,000)
                                           ---------------    --------------
                     Subtotal                    (113,000)         (174,000)
           Other                                 (236,000)         (215,000)
                                           ---------------    --------------
                      Total                $     (349,000)    $    (389,000)
                                           ===============    ==============
</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 segment's revenues decreased to $23,000 for the third quarter of 2001
compared to $61,000 for the same period in 2000. Fewer small coring and drilling
jobs were performed in the third quarter of 2001 than in the same period in
2000. Operating costs increased $2,000 to $135,000 for the third quarter of 2001
compared to $133,000 for the same period in 2000 primarily because the segment
employed one more technician during the third quarter of 2001 than the same
period of 2000. This approximate $11,000 increase was partially offset by $8,000
less in equipment rental expenses for the third quarter 2001 compared to the
same period of 2000. SG&A costs increased $6,000 for the third quarter of 2001
compared to the same period in 2000 as personnel in the segment increased their
efforts to develop the market for the segment's technology. As a result, the
operating loss for the third quarter of 2001 increased $46,000 to $143,000
compared to $97,000 in the third quarter of 2000.

Carbon dioxide

     Third quarter 2001 operations reflected an operating profit of $64,000
compared to $84,000 in the 2000 third 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 decreased $25,000 or 20% to
$100,000 for the third quarter of 2001 compared to $125,000 for the same period
in 2000. The drop in revenue was primarily due to a drop in the price received
for CO2 gas during the quarter.

China

     The China Segment reflected an operating loss of $100,000 for the third
quarter of 2000. Since January 1, 2001, the operations of this segment have been
conducted through an affiliate. The third quarter of 2001 resulted in a loss of
$85,000 which is included in equity in operations of unconsolidated affiliates
discussed below. The segment had no revenues in either the third 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 $34,000 in the third
quarter of 2001 versus an operating loss of $61,000 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 third
quarter of 2001 or 2000 while pursuing the development of its technology.

Other activities

     Other operations, consisting principally of general and corporate
activities, generated a $21,000 greater loss in the third quarter of 2001 than
in the same period in 2000. This increase was due primarily to increased benefit
costs in 2001 over 2000.

Selling, general and administrative expenses

     The Company's selling, general and administrative expenses ("SG&A") were
$26,000 less in the third quarter of 2001 compared to the same period in 2000.
The Coal Segment had an increase in SG&A expenses of $6,000 due to increased
marketing expenses for the segment. The e-Commerce Segment incurred $29,000 less
in SG&A expenses as the segment cut back on its efforts to pursue strategic
alliances for its technology. Other operations, primarily corporate, incurred
approximately $3,000 less in SG&A for the third quarter of 2001 compared to the
same period in 2000.

Depreciation, depletion and amortization expenses

     The third quarter of 2001 reported an increase in DD&A expense of $1,000,
reflecting additions to property, plant and equipment made since September 30,
2000, primarily in the Coal Segment.

Other income and expense

     Other income and expenses netted to a loss of $42,000 for the third quarter
of 2001, down sharply from the $284,000 of income recorded for such items in the
same period of 2000. Interest income was up $13,000 for the third quarter of
2001 compared to the same period in 2000 primarily as a result of an increase in
notes receivable. Interest expense was up $34,000 reflecting the Company's
increased level of indebtedness. The Company realized a decrease of $185,000 in
gain on sale of assets primarily as a result of the sale in third quarter of
2000 of the property owned by a real estate partnership in which the Company had
an interest.

     The Company's equity in the operations of unconsolidated affiliates was a
loss of $50,000 for the third quarter of 2001 compared to income of $65,000 for
the same period in 2000. The Company's equity in the earnings of Cibola
decreased $35,000 from $70,000 for the third quarter of 2000 to $35,000 for the
same period in 2001 reflecting losses on certain outside investments by Cibola.
Entities involved in the China Segment have signed contracts and formed
Cooperative Joint Ventures ("CJV's") or similar arrangements with various
Chinese partners for the construction of two 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 entities devote all their time and energies to the
development of the business related to the technology utilized by the CJV's. The
operations in China are now conducted through an affiliate and accordingly the
Company's share of the losses from these operations, which amounted to $85,000
for the three months ended September 30, 2001, are recorded as other expense for
the period involved. During the 2000 third quarter such operations were
conducted by a wholly-owned subsidiary and reported as an operating loss for
such period as discussed above.

Income taxes

     The Company made no provision for income taxes in either the third quarter
of 2001 or the same period in 2000. 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
     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 September 30,
2000 was $139,000 which was charged against the loss accrual recorded in 1999.
Beard recorded a loss of $22,000 for the three months ended September 30, 2001
for net operating expenses of the smaller of the two plants distributed to the
Company in 2000. This loss was not anticipated in the loss accrual of 1999.

     As of September 30, 2001, the significant assets related to NABR's
operations consisted primarily of equipment and inventory with estimated net
realizable values of $70,000 and $78,000 respectively. The liabilities related
to NABR's operations consisted of accounts payable and accrued expenses of
$7,000 and $178,000, respectively. The Company is actively pursuing
opportunities to sell NABR's assets and expects the disposition to be completed
by March 31, 2002.

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 third quarter of 2001 and its
actual operating losses were $7,000 for the same period. The actual losses for
the three months ended September 30, 2001 were charged against the loss accrual
recorded in the fourth quarter of 2000.

     As of September 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 $21,000. Beard is actively seeking
opportunities to sell the remaining C-stores and expects them to be sold by
mid-year 2002.

WS Segment
     In May 2001 the fixed assets of the 50%-owned company (accounted for as an
equity investment) involved in natural gas well testing operations for the
Natural Gas Well Servicing ("WS") Segment were sold for $1,550,000, subject to a
hold back of $150,000. $21,000 of the hold back was received in June 2001. As a
result of the sale all debt of the 50%-owned company was retired and the Company
was relieved of contingent liabilities totaling $512,000. In August 2001 the
Company made the decision to cease pursuing opportunities in Mexico and the WS
Segment was discontinued. The Company is now pursuing the sale of all remaining
equipment owned by the segment.

     Beard's share of operating losses from the discontinued segment was
$36,000 and $451,000, respectively for the three and nine month periods ending
September 30, 2001. The nine month period included a provision of $175,000 for
estimated losses from the discontinuation of operations. Actual operating losses
of $25,000 for the three months ending September 30, 2001 were charged against
the impairment reserve established above. The remaining $10,000 of losses for
the three months ending September 30, 2001 were associated with the operations
of the sand separator company and were not anticipated in the loss accrual.
Beard's share of operating losses from the discontinued segment was $322,000 and
$931,000, respectively for the three and nine month periods ending September 30,
2000.

     As of September 30, 2001 the WS Segment had cash of $40,000 and accounts
receivable totaling $99,000. The remaining equipment consisted of five sand
separators and a number of tanks having a total recorded value of $357,000. The
significant liabilities of the segment consisted of taxes payable, trade
accounts payable and other accrued expenses totaling $104,000. It is anticipated
that all liabilities of the segment will be paid off prior to year-end 2001 and
that the companies in the segment 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. The segment's operating losses were none and $14,000 for the three
months ended September 30, 2001 and 2000, respectively. ISITOP had no
significant assets or liabilities at September 30, 2001.


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

     The net loss for the nine months ended September 30, 2001 was $1,522,000
compared to a net loss of $2,135,000 for the first nine months of the prior
year. Continuing operations posted a net loss of $1,006,000 after tax refunds of
$60,000 compared to a loss from continuing operations of $1,023,000 after taxes
of $14,000 for the same period in 2000. Discontinued operations accounted for
$516,000 of the net loss for the 2001 period versus $1,112,000 in the 2000
period.

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

<TABLE>
<CAPTION>
                                             2001                2000
                                        ----------------    ----------------
<S>                                     <C>                 <C>
      Operating profit (loss):
        Coal reclamation                $     (385,000)     $     (535,000)
        Carbon dioxide                         244,000             245,000
        China                                        -            (291,000)
        e-Commerce                            (137,000)           (215,000)
                                        ----------------    ----------------
                  Subtotal                    (278,000)           (796,000)
        Other                                 (702,000)           (726,000)
                                        ----------------    ----------------
                   Total                $     (980,000)     $   (1,522,000)
                                        ================    ================
</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 $120,000 for the first
nine months of 2001 compared to $84,000 for the same period in 2000. The segment
performed more small consulting and coring jobs in the 2001 period than in the
2000 period. Despite the increase in revenues, operating costs decreased $97,000
to $395,000 for the first nine months of 2001 compared to $492,000 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 $19,000 to $95,000 for the first nine months
of 2001 from $114,000 in the same period of 2000. As a result, the operating
loss for the first nine months of 2001 decreased $150,000 to $385,000 for the
first nine months of 2001 compared to $535,000 in the first nine months of 2000.

Carbon dioxide

     Operations for the first nine months of 2001 resulted in an operating
profit of $244,000 compared to a $245,000 operating profit for the first nine
months of 2000. 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 $4,000 to $342,000 for the first nine months of 2001
compared to $338,000 for the same period in 2000. The Company recorded $4,000
more in operating costs associated with the properties in the first nine months
of 2001 compared to the same period in 2000. While production volumes for the
McElmo Dome field decreased for the first nine months of 2001 compared to the
same period in 2000, paid volumes to the Company's interest decreased even more
as the Company reduced its overproduced status. The slight increase in revenue
for the current nine months was entirely due to higher pricing, with the Company
receiving an average of $0.37 per mcf sold in the first nine months of 2001
versus $0.34 per mcf in the year earlier period. Paid volumes were actually down
94,000 mcf in the current nine months versus a year ago due to underproduction.

China

     The China Segment reflected an operating loss of $291,000 for the first
nine months of 2000. Since January 1, 2001, the operations of this segment have
been conducted through an affiliate. The results of operations for the first
three quarters of 2001 were a loss of $250,000 which was included in equity in
operations of unconsolidated affiliates discussed below. The segment had no
revenues in either the first nine months 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 $137,000 for the first
three quarters of 2001 versus an operating loss of $215,000 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 nine months of 2001 or 2000 while pursuing the development of its
technology.

Other activities

     Other operations, consisting principally of general and corporate
activities, generated a $24,000 smaller operating loss for the first nine months
of 2001 than in the same period last year. The Company experienced minor cost
reductions in numerous expense classifications.

Selling, general and administrative expenses

     The Company's selling, general and administrative expenses ("SG&A") in the
first nine months of 2001 decreased to $904,000 from $1,050,000 for the 2000
nine months. The Coal Segment had a decrease in SG&A expenses of $19,000 due
primarily to reductions in staff and other expenses. The e-Commerce Segment
incurred $81,000 less in SG&A costs as the segment scaled back its pursuit of
strategic alliances. Other operations incurred approximately $46,000 less in
SG&A for the nine months of 2001 compared to the same period in 2000 primarily
as a result of decreased professional costs and by the reduction in other
expenses discussed above.

Depreciation, depletion and amortization expenses

     DD&A expense increased slightly to $68,000 from $64,000 for the nine months
of 2001 compared to the same period in 2000, reflecting additions to property,
plant and equipment made since September 30, 2000, primarily in the Coal
Segment.

Other income and expenses

     The other income and expenses for the first nine months of 2001 netted to a
loss of $86,000 compared to income of $513,000 for the same period in 2000.
Interest income was up $32,000 for the first nine months of 2001 compared to the
same period in 2000 as a result of increased amounts loaned to fund our
partners' operations in Mexico and China. Interest expense was up $114,000 as a
result of the increase in debt, primarily to related parties. Gains on sale of
assets for the first nine months of 2001 decreased $127,000 to $79,000 compared
to $206,000 in the prior year period. The 2000 period included a $194,000 gain
on the sale of the property owned by a real estate partnership in which the
Company had an interest.

     The Company's equity in the operations of unconsolidated affiliates
reflected a loss of $156,000 for the first nine months of 2001 compared to
income of $213,000 for the same period in 2000. The Company's equity in the
earnings of Cibola decreased $107,000 from $213,000 for the first nine months of
2000 to $106,000 for the same period in 2001 reflecting Cibola's decline in
operating results. Entities involved in the China Segment have signed contracts
and formed Cooperative Joint Ventures ("CJV's") or similar arrangements with
various Chinese partners for the construction of two 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 entities devote all their time and
energies to the development of the business related to the technology utilized
by the CJV's. The operations in China are now conducted through an affiliate and
accordingly the Company's share of the losses from these operations, which
amounted to $262,000 for the first nine months of 2001, are recorded as other
expense for the period involved. During the first nine months of 2000 such
operations were conducted by a wholly-owned subsidiary and reported an operating
loss for the period as discussed above.

Income taxes

     The Company recorded refunds of $41,000, $2,000 and $17,000 for federal,
foreign and state income taxes, respectively, in the first nine months of 2001
compared to $14,000 in alternative minimum tax expense for the same period in
2000. 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 September 30, 2001 as
compared with the Quarter ended September 30, 2000" under the "Discontinued
Operations - North American Brine Resources" heading.

     NABR's actual loss for the nine months ended September 30, 2000 was
$276,000, the Company's share of which was charged against the loss accrual
recorded in 1999. Beard recorded a loss of $48,000 for the nine months ended
September 30, 2001 for net operating expenses of the smaller of the 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 September 30, 2001 as compared with the Quarter ended
September 30, 2000" under the "Discontinued Operations - ITF Segment" heading.

     ITF's revenues and actual operating losses were $1,653,000 and $224,000,
respectively, for the nine months ended September 30, 2000. The first $180,000
of the actual losses were charged against the loss accrual recorded in the
fourth quarter of 1999, and the remaining $44,000 was charged to operations.

     ITF's revenues and actual operating losses were $7,000 and $44,000,
respectively, for the nine months ended September 30, 2001. The actual losses
for the nine months ended September 30, 2001 were charged against the loss
accrual recorded in the fourth quarter of 2000.

WS Segment
     Complete details concerning the discontinuance of the Company's natural gas
well servicing operations are contained in "Material changes in results of
operations - Quarter ended September 30, 2001 as compared with the Quarter ended
September 30, 2000" under the "Discontinued Operations - WS Segment" heading.
Beard's share of operating losses from the discontinued segment was $36,000 and
$451,000, respectively for the three and nine month periods ending September 30,
2001. The nine month period included a provision of $175,000 for estimated
losses from the discontinuation of operations. Actual operating losses of
$25,000 for the three months ending September 30, 2001 were charged against the
impairment reserve established above. The remaining $10,000 of losses for the
three months ending September 30, 2001 were associated with the operations of
the sand separator company and were not anticipated in the loss accrual. Beard's
share of operating losses from the discontinued segment was $322,000 and
$931,000, respectively for the three and nine month periods ending September 30,
2000.

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 September 30, 2001 as compared with the
Quarter ended September 30, 2000" under the "Discontinued Operations - ISITOP,
Inc." heading.

     ISITOP had no revenues for either of the nine month periods ended September
30, 2001 or 2000, respectively. The segment's operating losses were $17,000 and
$131,000 for the nine months ended September 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
September 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 September 30, 2001, the Company had notes receivable of $1,006,000 and
long-term debt of $2,639,000. $197,000 of the notes receivable and $2,339,000 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 September 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 $30,000. 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
instrument governing the rights of the preferred stockholders. 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 5 to the accompanying financial
statements.

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. (This Exhibit has been previously
             filed as Exhibit 10(q) to Registrant's Form 10-Q for the period
             ended June 30, 2001, filed on August 14, 2001, and same is
             incorporated herein by reference).

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

10(s)        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(t)        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(u)        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(v)        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(w)        Renewal Promissory Note from Registrant to the Trustees of the
             Unitrust dated June 30, 2001. (This Exhibit has been previously
             filed as Exhibit 10(v) to Registrant's Form 10-Q for the period
             ended June 30, 2001, filed on August 14, 2001, and same is
             incorporated herein by reference).

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

10(y)        Promissory Note from Registrant to the Trustee of the William M.
             Beard Irrevocable Trust "B" (the "B Trust") dated August 31, 2001.

10(z)        Promissory Note from Registrant to the Trustee of the William M.
             Beard Irrevocable Trust "C" (the "C Trust") dated August 31, 2001.

10(aa)       Promissory Note from Registrant to B & M Limited, a General
             Partnership ("B&M") dated August 31, 2001.

10(bb)       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(cc)       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(dd)       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(ee)       Extension Promissory Note from Registrant to BOK dated June 30,
             2001. (This Exhibit has been previously filed as Exhibit 10(z) to
             Registrant's Form 10-Q for the period ended June 30, 2001, filed on
             August 14, 2001, and same is incorporated herein by reference).

10(ff)       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(gg)       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(hh)       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(ii)       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

                                 HERB MEE, JR.
(Date)   November 15, 2001       ___________________________________
                                 Herb Mee, Jr., President and
                                 Chief Financial Officer

                                 JACK A. MARTINE
(Date)   November 15, 2001       ___________________________________
                                 Jack A. Martine, Controller and
                                 Chief Accounting Officer
<PAGE>
                                  EXHIBIT INDEX

Exhibit
No.       Description                            Method of Filing
-------   -----------                            ----------------

2(a)      Agreement and Plan of Reorganization  Incorporated herein by reference
          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 in  Incorporated herein by reference
          effect.

4(a)      Certificate of Designations, Powers,  Incorporated herein by reference
          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 Stock  Incorporated herein by reference
          Units Plan as amended effective
          October 23, 1997.

10(d)     Amendment No. Two to The Beard        Incorporated herein by reference
          Company Deferred Stock Compensation
          Plan dated November 1, 1995, as
          amended June 7, 2001.

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 between  Incorporated herein by reference
          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 and  Incorporated herein by reference
          between Registrant and the Unitrust
          dated September 1, 2000.

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

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

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

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

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

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

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

10(w)     Renewal Promissory Note from          Incorporated herein by reference
          Registrant to the Trustees of the
          Unitrust dated June 30, 2001.

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

10(y)     Promissory Note from Registrant to    Filed herewith electronically
          the Trustee of the William M. Beard
          Irrevocable Trust "B" (the "B
          Trust") dated August 31, 2001.

10(z)     Promissory Note from Registrant to    Filed herewith electronically
          the Trustee of the William M. Beard
          Irrevocable Trust "C" (the "C
          Trust") dated August 31, 2001.

10(aa)    Promissory Note from Registrant to B  Filed herewith electronically
          & M Limited, a General Partnership
          ("B&M") dated August 31, 2001.

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

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

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

10(ee)    Extension Promissory Note from        Incorporated herein by reference
          Registrant to BOK dated June 30,
          2001.

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

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

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