During the reporting period, work continued on development of formulations using the materials down-selected from the initially identified contenders for the fibrous monolith wear resistant components. The FM systems studied were: WC-Co/WC-Co, WC-Co/Co, diamond/WC-Co, and Al{sub 2}O{sub 3}/Al{sub 2}O{sub 3}-TiCN. Extrudable formulations for the materials listed were developed during the first twelve months of this effort, and work during the reporting period was focused on the development of optimized binder removal processes. A two stage binder removal process was developed that resulted in prototype parts free of voids and other internal defects. In addition, changes in the binder removal atmosphere resulted in the apparent elimination of residual carbon, an important consideration when consolidating WC-Co containing systems. Using the improved binder removal processes, parts were consolidated by both sintering and hot pressing to >99% theoretical density. Samples of these materials were sent to Kyocera for mechanical evaluations. Fabrication of drill bit inserts was begun, and binder removal begun during the reporting period. A total of 24 green inserts were fabricated, and will be consolidated and delivered for field testing during the upcoming reporting period.