In a process for liquefying coal and similar solid carbonaceous materials wherein the solid carbonaceous material is slurried with a hydrogen donor solvent or a diluent distillate fraction derived from the solid carbonaceous material subjected to liquefaction and hydrogenated to increase the hydrogen donor species content thereof wherein the liquefaction is accomplished at elevated tempertures and pressures, the improvement which comprises extracting at least a portion of the naphthenic components from the hydrogenated solvent or diluent distillate fraction, converting at least a portion of the extracted naphthenic compounds to the corresponding hydroaromatic components and then combining at least a portion of these hydroaromatic components with the solvent or diluent distillate fraction.