The objective of this program is to develop a system to both monitor the vibration of a bottomhole assembly, and to adjust the properties of an active damper in response to these measured vibrations. The key feature of this system is its use of a magnetorheological fluid (MRF) to allow the damping coefficient to be changed extensively, rapidly and reversibly without the use of mechanical valves, but only by the application of a current. Phase I of this program, which entailed modeling and design of the necessary subsystems and design, manufacture and test of a full laboratory prototype, was completed on May 31, 2004. Much of the effort was devoted to the design and testing of the MRF damper, itself. The principal objectives of Phase II were...