TBLI CONFERENCE™ NORDIC 2014 - Entrepreneurs Salon - Mitja Hinderks - Litus Foundation

The LITUS FOUNDATIONGLOBAL WARMING MITICATION & ADAPTATION

An Environmental BreakthroughNew Extreme Efficiency Uncooled Engines

Mitja Hinderks CEO The Litus FoundationLos Angeles California 1-310-208-6606 LitusFoundation.org

TBLI Conference Oslo September 10th and 11th

BACKGROUND• Around 1750 the metal piston, cylinder, crankshaft and connecting rod for

today’s internal combustion (IC) engine was first volume produced, for reciprocating steam engines.

• By the 1930's, nearly all of today's IC engine technologies were developed, including modern IC turbine (jet) engines for aircraft and power generation.

• Today, only these piston and turbine engines are seriously produced, with their greater efficiencies, cost-effectiveness, or higher power densities.

• Every time any piston engine is run, 30% to 50% of fuel energy is dissipated by air- or water-based cooling systems and general radiation. Can we afford this waste ?

• Litus is now developing extreme efficiency uncooled engines for all uses and for all fuels, to cut fuel use and CO2 emissions by around half.

• The global engine market is today worth well over $350 Billion per year. It would be much more during a transition to uncooled engines.

6 September 2014 Breakthrough: Extreme Efficiency Uncooled Engines LitusFoundation.org slide 2

OPPORTUNITIES

• Currently no uncooled commercial engines are produced. According to the Sandia Combustion Laboratory, only Litus is developing them

• Litus uncooled engines have no plumbing for piston / cylinder oil system or cooling system. They can be snap-in cartridges, swappable in the field.

• Uncooled engines will be: • many times lighter and smaller than cooled engines;• about twice as efficient;• virtually silent, longer lasting, and more reliable;• ideal for hybrid drive systems in vehicles, industrial equipment .

• They have pistons and cylinders made of industrial ceramic inside thermally, acoustically and impact insulating casings. resolving earlier ceramics-in-engines issues.

• Add-on systems can recover extra-hot exhaust gas energy, further increasing shaft efficiencies to about 75%.


KEY BENEFITS• Extreme Efficiency: Uncooled units can show up to 54% efficiencies in

all size ranges, and for all fuels. • Uncooled engines run much hotter. A greater portion of fuel energy is used to push the

piston, with nearly all remaining energy in the super-hot exhaust gas.

• Lower Life-Cycle Costs: Reductions occur due to halved fuel use, no engine oil changes, and reduced maintenance needs.

• An example : At current $4.25/gallon fuel prices, a US Class 8 truck driving 200,000 miles annually at 7 mpg can save over $60,000 per year. Todays’ engines cost about $30,000, so a $60,000 uncooled unit can be paid back in six months, sooner in Europe.

• Better Power-to-Weight Ratios: Uncooled engines can be 2-20 TIMES smaller and lighter than today’s engines of equivalent power.

• Equal or Lower Production Costs: Ceramic pistons and cylinders are more costly than metal counterparts. But most Litus uncooled engines have only one of each. Cooling and oil systems are eliminated.

• Increased Applications: Expensive turbines can be replaced by uncooled engines, given their lower costs, improved efficiencies, reduced weight.


KEY BENEFITS continued

• No Traditional Cooling and Oil Systems: Their cost, weight, bulk are eliminated; they are the principle causes of today’s engine failures.

• Gas bearings separate the piston and cylinder, thereby eliminating oil lubrication. Coolant and oil is no longer used or need be disposed of.

• Snap-in Cartridges: They are possible, because there is little or no plumbing or need to circulate air around an engine block.

• This small and light cased engine can be swapped in minutes, and even exchanged for varying uses.

• Simplicity: The engine’s thermal and acoustic insulation and lack of heat signature can virtually mask all sound and heat.

• Uncooled engines have one to five base moving parts, excluding small fuel system parts, compared with over twenty in today’s four cylinder cooled engines.

• Improved Compounding: Adding systems (“compounding”) such as turbines to extract work from energy-rich exhaust gas – thereby cooling it –can boost efficiencies up to 75%.


CURRENT ACTIVITY

• Litus is designing and will build and test about six 20-year-life commercial pre-production prototypes, circa 550 hp (400 kW). Output shaft efficiencies will be around twice today’s at about 50%; weight and bulk around tentimes less. They will be virtually silent and more reliable.

• Patents will be licensed for generators; pumps; compressors; hybrid drives in vehicles, ships, farming / mining / industrial equipment, later for autos.

• A consulting alliance is being formed with European and US research institutions and early-enabling companies, including makers of engine-related products and large users of engines (such as operators of vehicle fleets). They will have preferential access to the technology.

• Discussions are underway with several companies. all with revenues over $10 billion. The leading Swedish government research agency has offered to build the prototypes’ ceramic pistons and cylinders.


TIMELINE• Program Phases are: Completed Phase One: Base Tasks included concepts,

patents, modeling, business strategies and industry contacts, team.

• Phase Two: Development is underway and includes completing research / modeling / design of all components, engine and engine-generator layouts.

• Phase Three: Build & Test is in two parts. Part A entails building / testing sub-systems and developing ceramic component production systems. Part B entails fabricating / assembling all components and 1,000-hour prototype testing within 18 months. Contingencies allow for one extra year.


INVESTMENT & USE OF FUNDS• Investment loans for the $18 million prototypes program are sought, secured

by all project assets including the valuable patent portfolio. In addition to interest / repayment, investors as bonus will receive a saleable share of gross IP revenues, which could generate up to $1 Billion within three to four years.

• The $18 million (contingencies 106% of $8.7 million base cost) is available as grants and loans from US / European semi-government sources. To harvest these, a $850,000 bridge investment loan being separately negotiated.

• About $4 million, half sweat equity, has been spent on competed Phase One.

• Current Phase Two: Development budget is $1.5 million, including a $500,000 contingency. Completion is due six months following funding.

• Phase Three: Build & Test is budgeted at total $11.5 million in two parts ($2.5 million and $9 million). Completion is in twelve months, with a further $5 million contingency for a twelve month time over-run.

• After successful testing, license option incomes will quickly accrue, from companies not wanting to be shut out of a breakthrough in their industry.


MARKET & INTELLECTUAL PROPERTY (IP)• As noted, the world engine market is today worth over $350 Billion per

year. It would be a lot more during a switch to uncooled engines.

• The Litus IP portfolio comprises multiple issued US and national patents / patent applications in over fifty countries.

• US Nationwide valuation firm Stout Risius Ross in December 2012 in an initial “first-pass” review initially valued Litus’ engine-related IP at around $300 million, with perhaps as little as 10% obtainable in a fire-sale

• The Patent Law Firm Steptoe & Johnston in Los Angeles prepared a report on the quality / scope of the engine-related disclosures.

• The report indicated a high probability of an effective "lock" on the uncooled engine idea. It is unlikely another could build without infringing part of the Litus portfolio.

• Issued patents and applications in over fifty countries are based on PCT/US2006/039204, WO 2008/045036 (120,000 words, 500 diagrams) and expanded PCT/US2008/004927, WO 2009/145745 (150,000 words, 580 diagrams). [A PCT filing is placeholder, entitling patent applications within thirty months in selected countries.]


CERAMICS IN ENGINES• In the 80's, 90's, ceramic piston crowns and cylinder sleeves were placed in

metal engines, leaving engine design unchanged. Failures were due to using the wrong ceramics; using them structurally and as insulators (they are rarely good at both); metals’ and ceramics’ differing thermal expansion rates.

• Litus has totally redesigned engines around three parameters: 1) no cooling, and therefore no engine block; 2) the beneficial material characteristics of ceramics; 3) the most viable ways of producing & assembling ceramic parts.


One of many alternative layouts: A piston / cylinder assembly at both ends of reciprocation:

O

A SCHEMATIC DIAGRAM(See also available document ‘Uncooled Engine Technology’)


KEY TEAM MEMBERSMitja Hinderks, founder, board member, CEO, inventor of key concepts, has over thirty years' experience as an engineering, industrial and architectural designer on large and small projects. He studied architecture at the Regent Street Polytechnic and engineering at the Open University, England. He has worked on engines, emission systems, hulls, brakes. Architecture includes design development of Frank Gehry's Walt Disney Concert Hall, a 1,000-bed teaching hospital, universities and theme parks.

Jamie Eppolite, BSc Rutgers in BioEnvironmental Engineering, is administrator and head of IT. After further energy-related coursework in thermodynamics and IC engines, she project engineered on environmental impact assessments and developing models for energy and water use for a wide range of projects.

Gregory T Smedley, board member, PhD Caltech, is overseeing the integration of electrical generators / controllers, as most first engine applications will be for hybrid electric drives and generator sets. Greg has lengthy experience in experimental research and commercialization, and has been principal investigator on US government contracts. He was awarded a prize by the military for best execution of a contract.

Thomas Quenaon, BSc French Institute of Advanced Mechanics, Clemont-Ferrand, graduate research at UCLA. He worked at FACC AG in Austria on a business plane wing-to-body fairing, and at Marsaudon Composites in France on composite structures for sailboats, and various components including for nuclear submarines. He is currently completing a contract on blade design with EADS in Paris, and is due to join Litus in October.

Charles Bragg Jr, board member, financial director. After graduating at Stanford, Chuck entered the securities industry at closely-held investment house Quincy Cass Associates. After early retirement, he became active in the National Audubon Society, serving on the National Board of Directors for six years, and is currently the president of the Santa Monica Bay chapter. He volunteers for non-profit art support groups in opera and music schools.

Other members include leading materials scientists; a combustion specialist for whom Rolls-Royce has built a European laboratory; the heads of the Mechanical Engineering and Materials Departments at two noted California universities; an ex-SKF leading specialist in numerical analysis and bearings.


ENVIRONMENTAL BENEFITS• Up to 60 % of man-made CO2 is said to come from internal combustion (IC)

engines. Once available, uncooled engines – with production costs equivalent to todays’ – would replace nearly all cooled engines. Successfully spending up to $18 million on the production prototypes would lead to a global switch to uncooled engines within ten to fifteen years, alone reducing all man-made CO2 emissions by 25% to 35%. In contrast, $ trillions are required for needed renewables: eg solar, wind farms, electric vehicles / charging systems.

• Reports on already-happening climate change show a 95% probability that severe weather events and global warming are caused mostly by man-made CO2. Unless emissions are quickly, radically cut, we face a hazardous future.

• Awareness of uncooled engine production within three years could motivate greater efforts. More renewables could cut CO2 by about 25%. Increasing buildings' efficiency would cut another 15%. Changing ingrained habits (say in driving; use of air-conditioning / heating), would cut a further 12%.

• If we do everything, CO2 emissions can be cut by about 75% within fifteen years, far more than now thought possible.


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1-310-208-6606 [email protected]

The LITUS FOUNDATIONGLOBAL WARMING MITICATION & ADAPTATION

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TBLI CONFERENCE™ NORDIC 2014 - Entrepreneurs Salon - Mitja Hinderks - Litus Foundation