Abstract: A system for removing oil, water and other adulterants from machine shop scrap cuttings. Scrap is inserted in the upper end of an inclined tumbler barrel and passed through a counterflowing stream of hot gases from a burner located at the lower end. Oxygen is inserted into the tumbler barrel at an intermediate position. The barrel is lined with refractory inserts each having contiguous connecting passages of different diameters. The scrap is raised to a temperature near its melting point and compacted into briquettes while remaining hot. Excess fuel gas flow and combustion prevent the aspiration of air into the barrel and thus prevent oxidation of the metal part of the scrap. As an alternative, the scrap can be melted as it flows from the tumbler barrel directly into a melting pot.