This is the fourth quarterly progress report for Year-3 of the ACTS Project. It includes a review of progress made in: (1) Flow Loop construction and development and (2) research tasks during the period of time between April 1, 2002 and June 30, 2002. This report presents a review of progress on the following specific tasks: (a) Design and development of an Advanced Cuttings Transport Facility (Task 3: Addition of a Cuttings Injection/Separation System), (b) Research project (Task 6): ''Study of Cuttings Transport with Foam Under LPAT Conditions (Joint Project with TUDRP)''; (c) Research project (Task 9b): ''Study of Foam Flow Behavior Under EPET Conditions''; (d) Research project (Task 10): ''Study of Cuttings Transport with Aerated Mud Under Elevated Pressure and Temperature Conditions''; (e) Research on three instrumentation tasks to measure: Cuttings concentration and distribution in a flowing slurry (Task 11), Foam texture while transporting cuttings. (Task 12), and Viscosity of Foam under EPET (Task 9b); (f) Development of a Safety program for the ACTS Flow Loop. Progress on a comprehensive safety review of all flow-loop components and operational procedures. (Task 1S); (g) Activities towards technology transfer and developing contacts with Petroleum and service company members, and increasing the number …