Exhibit 10(b)

                                  June 6, 2003

                                  SUPPLEMENTAL
                              LETTER LOAN AGREEMENT


The Beard Company
5600 N. May Avenue, Suite 320
Oklahoma City, Oklahoma 73112

Gentlemen:

This Supplemental  Letter Loan Agreement  supplements the previous  Supplemental
Letter Loan Agreement between the parties hereto dated November 7, 2002.

This  Supplemental  Letter Loan  Agreement  sets forth the terms and  conditions
under which we have agreed to supplement your existing $3,000,000 long-term line
of credit with a short-term  revolving  loan to you in the  principal  amount of
$300,000.00 (the "Loan").

1. LENDER:     The  William  M.  Beard  and Lu  Beard  1988  Charitable
               Unitrust (the "Unitrust").

2. BORROWER:   The Beard Company.

3. AMOUNT:     Such  amounts as the  Borrower  may request from time to time  up
               to $300,000.00.  The Loan shall be evidenced by a promissory note
               in the amount of  $300,000.00 dated as of today (the "Note"). The
               Borrower shall be permitted to obtain advances, make prepayments,
               and  obtain  additional  advances,  up to the amount of the Note.

4. INTEREST    A fixed rate of 10.00%.
   RATE:

5. REPAYMENT:  The outstanding principal balance (the "Indebtedness")plus unpaid
               accrued  interest shall be  due and payable on October 31,  2003.
               The  parties agree that any payments made by Borrower to Lender
               shall be applied first to this Loan.

6. COLLATERAL: The Lender,  together with certain  Note Holders, have previously
               filed a  Deed of Trust,  Assignment of Production,  and Financing
               Statement  of record  (a "Lien")  on its  working  and overriding
               royalty  interests  in  the  McElmo  Dome  Unit  in Montezuma and
               Dolores Counties of Colorado ("Interests"). The Borrower will not
               sell,  transfer,  convey  or  otherwise  dispose  of  any  of the
               Interests,  whether  pursuant to a single transaction or a series
               of transactions.


7. COVENANT:   Until  the Indebtedness  has been paid in full, the Borrower will
               not sell,  transfer,  convey  or otherwise  dispose  of, all or a
               substantial  portion  of  its  assets   now  owned  or  hereafter
               acquired, whether pursuant to a single transaction or a series of
               transactions, and the Borrower will not merge or consolidate with
               any person or entity or  permit any  such merger or consolidation
               with the Borrower.   This  paragraph  specifically excludes asset
               sales incurred in the normal course of business.

8. EVENTS OF
   DEFAULT:    If  any  of  the  following  conditions  or  events  ("Events  of
               Default") shall occur and be continuing:

               A. Failure of the Borrower to pay when due any amounts, including
                  principal  or  interest  on  the Note  (whether  at the stated
                  maturity, upon acceleration or otherwise).

               B. Any Event of Default as specified in the Note.

               C. Any  default  or  breach  in the  performance of any covenant,
                  obligation,  representation,  warranty or  provision contained
                  in this  Letter Loan Agreement  or in the Note or in any other
                  note or obligation of Borrower to the Unitrust.

               D. The   Borrower  shall:   (i)  apply  for  or  consent  to  the
                  appointment of a custodian, receiver, trustee or liquidator of
                  the Borrower or any of its properties,   (ii) admit in writing
                  the inability to pay, or generally fail to pay, its debts when
                  they come due, (iii) make a general assignment for the benefit
                  of  creditors,   (iv) commence any  proceeding relating to the
                  bankruptcy,  reorganization,  liquidation,  receivership, con-
                  servatorship,  insolvency,  readjustment  of debt, dissolution
                  or liquidation of the Borrower,  or if corporate action should
                  be taken by  the Borrower for  the purpose of effecting any of
                  the foregoing, (v) suffer any such appointment or commencement
                  of a  proceeding  as described in clause  (i) or  (iv) of this
                  paragraph,  which  appointment or proceeding is not terminated
                  or discharged within 60 days, or (vi) become insolvent.

          THEN upon the  occurrence  of any Event of  Default  described  in the
          foregoing  paragraphs  the  unpaid  principal  amount  of and  accrued
          interest on the Loan shall  automatically  become  immediately due and
          payable, without presentment, demand, protest or other requirements of
          any kind, all of which are hereby expressly waived by Borrower.

If the foregoing terms and conditions are acceptable to you, please  acknowledge
your  agreement  by signing  below and  returning  one copy of this  Letter Loan
Agreement to us.

Sincerely,

LENDER:
THE WILLIAM M. BEARD AND LU BEARD
1988 CHARITABLE UNITRUST


WILLIAM M. BEARD                            LU BEARD
----------------------------                -------------------------
William M. Beard, Trustee                   Lu Beard, Trustee


Accepted effective this 6th day of June, 2003.

BORROWER:
THE BEARD COMPANY


HERB MEE, JR.
---------------------------
Herb Mee, Jr., President