Abstract: This invention is directed to a process for the conversion of solid cellulosic biomass materials or lignite to oil. A solids-oil slurry is contacted in a reactor with carbon monoxide and water vapor in the presence of an alkali metal and alkaline earth metal carbonate, bicarbonate or formate catalyst at a temperature of from about 250.degree. C. and to about 450.degree. C. at a pressure of from about 2000 psig to about 5000 psig. The gases from the reactor and oil hydrocarbon fuel, preferably a recycled heavy fraction of product oil containing spent catalyst, are burned at a pressure above the reactor pressure with oxygen to provide a carbon monoxide-water vapor gas having a temperature of from about 1100.degree.C. to about 1600.degree. C. Said gas is introduced under the surface of the oil slurry in the reactor to provide heat, carbon monoxide, water vapor, and, desirably, regenerated catalyst to said reactor.