082 Bobby Gallagher, CEO Deployable Energy

Bobby (00:00)
we're gonna be the first nuclear reactor company to be able to mass manufacture reactors. So we talk about stick build, we talk about modular build and the AP1000 is a modular build reactor. Then we talk about SMRs, we talk about factory build reactors. What we're talking about with our system, we're saying we're mass manufacturable and there's a difference.

Mark Hinaman (00:12)
you

Bobby (00:20)
from being continuous production, batch production, or semi-autonomous production. So we think we'll be the first reactor that can be basically mass manufactured in a continuous process. And that's due to our material choices, that's due to our process choices. So our reactor looks like boilerplate and pipes.

So that's key.

Mark Hinaman (00:41)
Yeah.

Mark Hinaman (01:49)
All right. Welcome to another episode of the Fire Division podcast, where we talk about energy, energy dense fuels and how they can better human lives. Today I'm joined by a good friend. I'd consider your friend Bobby. We've chatted several times now and really excited about what you're doing for the world. So Bobby Gallagher, Chief Executive Officer and Chief Technology Officer of Deployable Energy, which is one of these fancy new advanced reactor companies that are blossoming.

Bobby (02:01)
Yeah.

Mark Hinaman (02:17)
time to chat with you today. Bye for

Bobby (02:21)
I'm good Mark. Yeah, I've just come off a long road trip. feel like, ⁓ yeah, we couldn't quite squeeze in Denver. It would have been great to come see in Colorado, but yeah. Yeah, just, yeah. ⁓

Mark Hinaman (02:30)
I was really disappointed. We were going to go skiing and you bailed.

Bobby (02:41)
It's more the PR ⁓ and scheduling and we had a big event at ⁓ Salt Lake City on the capital steps and ⁓ Suzy who looks after all our PR stuff would have killed me if I added another stop. So that's where decisions get made. Yeah, exactly, exactly. ⁓

Mark Hinaman (02:58)
You're like, but I was gonna go see Mark in Colorado. It would have been awesome.

People should come and visit us

in Colorado. We've got the best place to host people, both in Denver and in the mountains. So open invite if folks are listening and they want to come see the fire and fishing crew in person.

Bobby (03:13)
⁓ yeah.

Yeah,

we're definitely doing it mate. And maybe we can have a whiskey and a cigar after we go critical in a couple of months. Yeah, yeah. All right. I only do them if there's been a big celebration. You've won a grand final. You've achieved something great. I'll crack one out.

Mark Hinaman (03:29)
Perfect. I quit cigars in 2018, but I will drink whiskey with you. That's a separate story. ⁓

Bobby (03:46)
So I've got very little in my life.

Mark Hinaman (03:47)
Bobby, where are you? There you go.

We've a lot to talk about. I'm really excited. And I'm working off no notes. So this is all from memory, which I don't think will be a problem at all. So Bobby, for the audience's sake, let's talk about you, some of your background. You've got an accent. It's not Colorado Mountain Barrow accent like mine. Where are you from?

Bobby (04:12)
Yeah, so from the deep South, Australia, or ex Australia. Exactly. Yeah, from Australia originally. ⁓ But I've been living off and on in Texas. ⁓

Mark Hinaman (04:17)
From the deep south. The deepest.

Bobby (04:28)
for about 10 years or so in Houston, predominantly. But yeah, so that's where I'm from originally, fourth generation to serve in the Australian military, did my time during the war on terror. And then when I jumped out of that game into the oil field, I worked for an American company and yeah, that's how I made my way here to the US of A.

Mark Hinaman (04:55)
So thank you for your service ⁓ When you started ⁓ Working for the oil and gas was that in Australia for an American company?

Bobby (04:55)
him.

So it was actually in South Korea. it was for Diamond Offshore Drilling. They're one of the largest offshore drillers in the world. Now they're all sort of...

Mark Hinaman (05:07)
about.

Bobby (05:18)
Yeah, merged to get consolidated. Yeah. But at the time, yeah, they were a Fortune 500 company that had building rigs in Korea, they were building rigs in Singapore. They're looking at rigs in building rigs in Europe. Yeah, it was wild. They were repairing rigs in the Gulf Coast. And so I landed in the shipyards of South Korea during one of the biggest capex booms in history. Yeah, it kind of reminds me of this data center boom that's happening right now.

Mark Hinaman (05:18)
consolidated, swallowed a little bit.

What year was that?

Bobby (05:49)
that

is so yeah, 13 is when I when I started. Yeah. And yeah, it was, it was wild, like, we're building the black ships as they'll call the black Hawk, the black Hornet, Rhino and lion and the ocean great white, which is a big harsh environment semi sub. And yeah, when I think when the first vessel got delivered, it was like champagne and caviar and ⁓ the CEO came out and the chairman came out and then

Mark Hinaman (05:51)
Okay.

Bobby (06:18)
we delivered the last rig, was like, here's a beer and get the hell out of here kind of thing. The Broom it well and truly run its course. Exactly. Exactly.

Mark Hinaman (06:24)
Hahaha!

You're welcome. We did that with the Shell Revolution. ⁓

I mean, let's

talk about that a little bit. So 23rd scene, remembering the history of the industry, oil and gas industry, that shale hadn't blossomed, if you will. I mean, it was certainly ramping up, but these projects had been commissioned. I imagine the planning for building these offshore ships was starting in 2006 or something silly like that. And then, I don't know, what do you think?

Bobby (06:57)
You'd be surprised.

You'd be surprised. I think they were done on a napkin at a bar in Seoul. It was so wild. That construction boom. Yeah. So yeah, that was...

Mark Hinaman (07:13)
A hundred dollar roll will make people do crazy things.

Bobby (07:21)
Yeah, there was a different time ⁓ and it will come back around again. Oil and gas can't help itself go through boom bus cycles. no, but yeah, but my real breakout though in the oil field was, you know, I didn't like how we're responding to the the Macondo.

crisis. Deepwater Horizon, there's huge spill in the Gulf. $60 billion.

Yeah, Bill for BP, 11 lives lost, know, TransOcean, TransOcean lost its most productive asset. ⁓ And I knew the physics deeply of that problem. And I knew the regulations deeply of that problem. And I knew very well that the incumbents weren't making the right steps to solve that problem. And so I sold, you know, I told the wife to sell everything, come to Houston. And I started a company called Kinetic.

pressure control which built a pyrotechnic gate valve that could seal and sheer and sheer and seal the well in milliseconds as opposed to 30 seconds and and be able to stop something like Deepwater Horizon from from ever happening again. yeah had Trans Ocean that lost the Regenvest had had you know the industry support us it was a wild ride we we built the company up ⁓

it was operating in five continents, COVID hit, yeah, that kind of pushed us off an IPO track and we were acquired eventually. yeah, that was my ride in the oil field. So shipyards through Asia and Northern Europe and a little bit in the Gulf Coast. then, yeah, building blowout preventers or what we call blowout stoppers and shipping them around the world. And then we branched off in

whole heap of other things as well. So yeah, wild ride. Yeah, yeah, love the, love the oil field.

Mark Hinaman (09:24)
That's awesome. I want to

highlight that a little bit or double click on the idea that you said, big problem, Macondo, what was that, 2011, 2012? Great movie memorializing it with Mr. Wahlberg. Yeah, you gotta go watch that if you haven't seen it. The bad guy, big oil in it, like, oh man, what a villain. No, I'm not saying that it's kind of silly watching it. You're like, okay, this is bit Hollywood.

Bobby (09:41)
Yeah, Yes, 100%. 100%, yeah.

Yeah, yeah.

Yeah.

Mark Hinaman (09:54)
Yeah. no, but you had a, saw a problem. So I'm going to go fix this. ⁓ I think that you could contribute. What was it like getting to Houston and like going through that startup process? mean, this is what a, what an awesome story for entrepreneurs and just like inspire people to go and do something similar to like you move from what?

Bobby (10:15)
So.

Yeah,

I moved from Korea. Yeah, I was in South Korea at the time, or living there, even though I was probably working most of my time out of Korea. But I moved from Korea to Houston, But yeah, it was...

Mark Hinaman (10:30)
Did you know anyone when you

got to Houston? Like direct to apartment, you stay in someone's basement, like you're married and you're like, all right, we're going to Houston.

Bobby (10:33)
⁓

Yeah, yeah, so yeah, so

yeah, there's a few vendors like that I knew really well. ⁓ You know, Joe Becker, Thrustmaster of Texas, they provided the big ⁓

the big propulsion units for the ships. they had, we had a few issues on the project and I was assigned to help them out and try and fix it. And ⁓ it was a big deal for Joe. This could have sent his company ⁓ to zero. And I helped him out. so ⁓ when I came to Houston, I said, hey Joe, I need a place to stay and some investment capital for this idea. yeah, he obliged and yeah.

we had this phenomenal facility that we moved into and we had some startup capital to get going. ⁓ But yeah, didn't know too many people, but yeah, Joe was a good friend and a great mentor and anchor investor for Kinetic. ⁓ But yeah, so was, yeah, you need a little bit of network, you need a little bit of luck.

But knowing the physics deeply, like you gotta know, yeah, that was a technical problem. It was a time exposure problem. ⁓ When a well is blown out, you're getting sand, water, gas, oil expanding at supersonic speeds, especially in deep water. ⁓ And so it's like the world's greatest sandblaster. And so ⁓ the problem wasn't... yeah. Exactly, yeah, exactly.

Mark Hinaman (12:07)
If you close a gate valve slowly, just erodes everything. We might

have some listeners that don't know what hell we're talking about. Macondo, big offshore oil build blowout. And when we say blowout, uncontrolled release of hydrocarbons, liquids, solids, et cetera, just leaving the subsurface rapidly. And you design the machine and system to be able to fix that or make sure that that won't happen in the future.

Bobby (12:16)
Yeah. Yeah.

Yep.

Yeah.

Yeah, exactly. that so that was the physics, we needed to do it in 30 milliseconds, as opposed to 30 seconds, it was an ⁓ erosion problem. And then the the regulations were holding us back as well. It was ⁓ it explicitly stated that you needed to use hydraulic ⁓

BOPs, blowout preventers. And yeah, you just can't move hydraulics that fast to close a valve. And so we had to move Congress, we had to move the regulator, which was BESSI at the time, to allow us to use this new technology. So it was the first principle solution, but then it was predominantly a human, ⁓ convincing, socializing. We were able to get to a technical solution pretty quickly. It was getting everyone comfortable with the regulatory changes.

And so, yeah, with all that, that was a great experience. It was my first deep tech baby. Now we're going into nuclear and I see so much of the same. Yeah.

Mark Hinaman (13:32)
Are there any parallels that you see here Bobby?

Bobby (13:35)
Yeah,

I see so many parallels. ⁓ And so, yeah, when I exited that business, had a lot of time and a bit of capital to look at that problem. And so, yeah, that was the birth of deployable energy.

Mark Hinaman (13:52)
I love it. So you're very mechanically oriented. Did you study engineering?

Bobby (13:58)
Yes, yeah,

the military put me through school. Yeah, they put me through mechanical engineering school back in Australia. Yeah, yeah. So.

Mark Hinaman (14:04)
Yeah,

then mean blow-up preventers are a wonderful parallel in my opinion to nuclear reactors. Like we don't build that many of them. They have to work every time. They are expensive. They're in high consequence environments. ⁓ So like you've got this kind of exposure to building.

chemical system that's comparable to like the kind of scrutiny. I would even argue like blowout providers are like harder than nuclear reactors in a lot of ways.

Bobby (14:35)
Yeah,

sure. Yeah, it doesn't have to be in a high H2S high corrosive environment. Yeah, 3000 meters, yeah, 10,000 feet on the bottom of the seafloor. You know, yeah, I'd say the engineering challenges is immense. You know, from a pure first principles perspective, I would say building the blower preventer was a bigger challenge than the reactor.

Mark Hinaman (14:43)
Yeah.

Okay, so you had some time, the company goes public, you sell it. Was it NOV acquired or who?

Bobby (15:06)
Yeah.

It was

a spin out out of Slumberjay. It was some execs out of Slumberjay. my goodness, I just lost the name. ⁓ acquired the company. So ⁓ yeah, that gave us some capital and some time. ⁓ And I started building a team. ⁓ Started just, you know.

One of my principles is like, you need to know the background art in order to innovate, or you're just stabbing in the dark. And so I had to...

Mark Hinaman (15:49)
getting the wheel.

Bobby (15:50)
you're reinventing

the wheel and you really don't know, if you don't know the background art, you don't know what's been done before. You don't know what IP landscape there is. And so you don't know where to innovate. And so I ended up hiring a team and getting some really great nuclear experts, Berkeley trained guys, Australian trained guys and said, hey, how do we make a one megawatt microreactor that could potentially be deployed offshore? ⁓

power offshore. The initial thesis was offshore on the gas installations. they promptly came and designed a, for those not in the industry, I can go through the definitions, but a Triso, HALU, metal hydride moderated heat pipe cooled reactor. And you don't need to know much, but your high temperature gas. This one here was, you could do high

Mark Hinaman (16:43)
I touch your gas, right?

Bobby (16:50)
temperature gas or heat pipes on this design. ⁓ it's basically getting the drop down menu and picking Ferrari and Bugatti on every engineering list. Yeah, it was a beautiful design, it was really elegant. But when we did the supply chain analysis, when we did the cost analysis, I said to the team,

gents, think we can build three of these things and sell three of these things. One for the bottom of the ocean, one for the moon and one for Mars. Yeah, this isn't going to change the world. This isn't going to change the world. And so so it's never the wrong solution. It's always the wrong question. And so we had to change the question. It's just like, yeah, how do I build a one megawatt micro reactor that uses the existing supply chain where I can buy the fuel right now from Westinghouse or GE?

Mark Hinaman (17:22)
Ha ha ha ha ha ha ha

Bobby (17:45)
or Framatome where I can, ⁓ where it has to be light water moderated. has to be light water moderated. It falls out of the sky and it's phenomenal in terms of its moderating properties. But we need a little higher temperature than the existing light water reactors because we want to make this thing small. And how do we make this thing inherently safe, unlike your traditional light water reactors? And so, yeah, I threw the challenge out to the team and yeah, it kind of fell on deaf ears. It was just like, yeah,

Bobby, I think you've lost it. You know, it's kind of crazy. That's impossible. And, okay, well, yeah, tell me where I'm crazy. you know, we spent the next sort of six to 12 months unpicking all the implied assumptions. And we ended up getting to a point where we do have a micro reactor, you know, we're calling it the Unity nuclear battery that can use the existing light water reactor supply chain. So 5 % LEU, light water as a moderator, we

helium as a coolant and it's in an extremely compact form where we can ship it in 24 container size logistics, know, shipping containers and we can basically be universally sightable. Just need a pad to land these things down and be inherently safe. And, you know, we've been able to pick up some great partners to help validate the design. We're working with Texas A &M, we're working with Idaho National Lab.

We're

working with Los Alamos National Labs. We're working with the DOE. we just, yeah, it's culminated this week in ⁓ being named in the nuclear energy launch pad program, which is the latest, you know, it's the reactor pilot program, a successor program. And ⁓ we just literally drove our reactor from Houston to Idaho. And we're installing it later this afternoon in the lab.

Mark Hinaman (19:39)
Hahaha.

Yeah. Nice. Star Wars

Bobby (19:45)
So yeah, you made it four. Yeah, exactly. Yeah, exactly. Yeah, yeah, yeah. Yeah.

Mark Hinaman (19:45)
day, May the 4th, right? Who knows when we'll release this? It should be soon, but yeah. May the 4th, we'll let it be known. got to deploy a Bulls Reactor, shut up and I know.

Bobby (19:56)
Yeah, so yeah, so it's, it's, we set the challenge and I think there's a whole heap of things that needed to happen to make this work. Yeah, the executive orders from the president, the the the willingness from the industry, like we got some phenomenal partners. And I'm not at liberty to name them all, but we've got some phenomenal partners that have been able to deliver, you know, from contract signing with the lab to delivery of a reactor in 94 days.

from contract signing with the lab to delivery of fuel in 104 days. ⁓ That is unheard of. ⁓ And it's all because of our design choices. It's all because of our process choices. We're completely allergic to anything that's not a continuous process. If it's a batch process, it's not on the dropdown list for the engineers to even look at. ⁓ Nickel based alloys, there's no ink and alcohol.

Mark Hinaman (20:35)
Yeah.

Bobby (20:56)
Yeah, that's not on the drop down list. ⁓ It's, yeah, anything that can't be mass produced like a F-150 truck, because that's what we want to be. We want to be the F-150 truck or the oil field of the energy, of nuclear energy. ⁓ It just isn't even talked about or discussed. It's just dismissed out of hand. It doesn't exist in our world.

Mark Hinaman (21:21)
Yeah.

So, all right, I've so much to unpack there. Really exciting stuff. ⁓ Deployable energy, I mean, there's a lot of microreactor, advanced reactor companies that have been running around for a long time. ⁓ You guys aren't very well known. You've stayed in stealth mode for quite a while. So talk to me about ⁓ the why, why nuclear? Why sell your oil field service equipment company and then...

Bobby (21:29)
Yeah.

Mark Hinaman (21:52)
Pivot to nuclear. Let's start there. And then ⁓ how long did you spend in stealth mode and talk to me about building the team? And yeah, we can unpack that next. I'm really curious.

Bobby (22:03)
Sure.

Yeah, so yeah, the why I get like I just seen so many opportunities where energy is the limiting factor in ⁓ in even just like hydrocarbon developments in offshore in the offshore oil and gas space that ⁓ yeah, yeah, yeah, yeah, exactly, exactly. And so so that was the initial thesis and then obviously the whole world's

Mark Hinaman (22:19)
I it was for me, man. I was like, burning 20,000 gallons of diesel every day to frack. There's gotta be a better way.

Bobby (22:32)
kind of moved in our direction. yeah, I've got, cool. Yeah, and so like, and like I've got, I've got a great love for the ocean and for. ⁓

Mark Hinaman (22:37)
caught up to us, right? They're like, yeah, these guys are awesome.

Bobby (22:49)
remote islands and places like that and they all run on diesel grids. ⁓ They're too small for traditional ⁓ thermal generators, whether it's coal or gas. ⁓ They're too isolated remote for wind and solar typically takes up arable land. And so the only option for a lot of these islands is to have diesel infrastructure. And so ⁓ the ability

Mark Hinaman (22:54)
you

Bobby (23:19)
need

to ⁓ displace that with a clean, reliable, yet resilient power source that ⁓ can run for years without needing to be refueled. ⁓ There was islands in Australia and in the Pacific that ran out of diesel during COVID because the supply chain just got all gummied up. So yeah, that's a bit of the why. It's getting energy where it's needed. ⁓

Yeah, affordably that some of these islands like Vanuatu that they pay like $1,000 a megawatt hour $1,000 a megawatt. That's that's $1 a kilowatt hour for for for electricity.

Being able to bring a technology to a place like that would be transformative. You give them electricity at 12 cents a kilowatt hour, like for one eighth of the cost, you're gonna bring these communities out of economic and energy poverty. ⁓ And we did a study with Fiji, like we could give back like five to 6 % of their GDP ⁓ to a country every year that they're paying right now on diesel. ⁓ And we could make them structurally.

more competitive by lowering their error.

Mark Hinaman (24:36)
That's strictly, I mean, because like you

can fly in the fuel or number of fuel shipments, it's significantly less, right? And so just literally the amount of energy it takes to get the fuel, to get a comparable amount of diesel shipped to a location versus fly in your uranium core or ship it in, right? Yeah. It's just the first principle of physics, the energy density. Makes people's lives better. Look at that. Catchphrase from the podcast.

Bobby (24:41)
Yep. Yep.

yeah.

Yeah.

Exactly. That's what, yeah, yeah, yeah, yeah, yeah,

yeah, yeah, yeah, yeah, 100%. And so that's...

You can replicate that story onto 10,000 islands. You can replicate that story to like the 5 billion people that have energy poverty right now. And you don't need the infrastructure. You don't need a huge centralized transmission grid to be able to distribute it. You can put the power where it's needed. yeah, some of the other benefits are that you can use the waste heat. Right now we send two thirds of the heat into steam or into evaporating water into the atmosphere.

we think we can capture 70, 80 % of the power that gets generated from the reactor into usable ⁓ electricity and to power, whether it's chill water systems or hot water systems, depending on the time of year for these places. And so from an economic perspective, it's always been ⁓ an issue for micro reactors that they're less ⁓ resource ⁓ efficient than big systems. But actually, if you can co-loathe

or be close to the user, you can use more of that energy that would traditionally be used for heating water ⁓ or running air conditioning systems. And so we actually get better resource utilization. ⁓ And so that's the dream. That's the vision we're shooting for. We've made tangible steps. We're one of the very few companies, and especially a startup, where we've commercially

actually, probably bought fuel and built a reactor and shipped it to a site. When we say deployable energy, we mean it. We're starting right now to do that.

Mark Hinaman (26:50)
Yeah.

How did you find the team? You mentioned building the team and it sounds like...

My experience with some people in the nuclear industry has been like there's some untraining that has to happen. ⁓ You mentioned this Rolls Royce approach, or not Rolls Royce, sorry, for our, we'll call it, Bugatti approach. Maybe a little bit of slip there with Rolls Royce, but yeah. We're gonna gold plate everything and ⁓ make sure that we've got the best of the best. ⁓

Bobby (27:03)
Yep, 100%.

Yeah, yeah. Yay. Yay.

Yeah.

Mark Hinaman (27:27)
But then there's like, you and I both know from building businesses in one gas, economics drive everything, incentives drive everything. If that part of the equation doesn't fit. So talk to me about sourcing the team and was there some untraining elements?

Bobby (27:32)
Yep. Yep. Yep.

Yeah, that first, so I had the luxury, ⁓ you know, to be able to bootstrap this, had the luxury to learn how the nuclear energy industry thinks or understand the safety culture, understand the engineering process. And so it was, yeah, the first year...

Mark Hinaman (27:59)
How did you build that understanding?

What information sources was this going to be talking to people or were reading a bunch?

Bobby (28:05)
Yeah,

so if I wasn't a mechanical engineer, I'd be a historian. I love ⁓ learning and understanding how our forebears thought because very rarely are they ⁓

They're typically smarter than us. And in nuclear, like the first Renaissance, yeah, in the 50s and 60s and into the early 70s. Yeah, they built these reactors with slide rules. The papers that they wrote are actually readable and they're not AI, AI gump or yeah, they're not, they're not super, yeah, they're written in a way that a layman can read it. And so, yeah, I followed. So one, like on my own personal

⁓ my own personal learnings, I really learned about why certain technologies were selected. so ⁓ followed obviously the American program, the Canadian program, the British program, the French and the Soviet program in particular. And the one that I was really drawn to was the Canadian program. now, know, or the 51st state, you know, as we call it down here. But the Canadian program.

Mark Hinaman (29:18)
you

Bobby (29:21)
is an amazing, what they did with those Kandoo reactors is, to me, is the most fascinating and the most brilliant part of the nuclear engineering ⁓ story. it's, no one would give them EUP, ⁓ Enriched Uranium. ⁓

No one, they didn't have any forging capabilities. They didn't have the industry to build large pressure vessels that your traditional light water reactors needed. ⁓ But they had a workforce. They had obviously a tremendous amount of smart people. And so they built a reactor that needed naturally enriched uranium. And instead of building a pressure vessel reactor, which requires very substantial forgings, they built a pressure tube reactor, which is basically breaking up your reactor vessel into hundreds

of small tubes. And so that's a far simpler method of construction than these big forgings. And so I took a lot of inspiration there because when we fast forward to where the US is now, ⁓ back then the US had all the enrichment, the US had all the forgings in Pittsburgh and in the Midwest, and it had the workforce and it had the regulatory environment. And so it made perfect sense to build pressurized water reactors.

Fast forward now, we've got no enrichment, basically, or very limited enrichment. We've got no forging capacity, at least for the big light water reactor. And we've got a workforce that's designed to build products, not projects. You know, we build good planes, we don't build good airports, you know. And yeah, being a Houstonian, I live that every day with the airports there. and so

I took that inspiration from the Canadian program and we kind of blended it into deployable energy. We need to make nuclear a product, not a project, and we need to match our skill sets. so ⁓ what the oil field does so well, what ⁓ Houston in particular does so well, is put things on skids that need to be mission critical and ship them to a site.

and have have the worker or in the oil field or roughneck bang on it with a hammer. And it needs to work every single time. Yeah. And Houston does that better than. yeah, yeah, yeah.

Mark Hinaman (31:47)
literally tying these pipes together with hammer. Like when you say bang on over the hammer, that's not like hyperbole.

It's like, no, we connected the flow path with a connection that is literally connected with a hammer.

Bobby (31:56)
Yeah, yeah, with a big. Yeah, yeah, exactly.

Exactly. And we're both the awful bros. We know that. And so Houston's the center of the world for designing those sorts of skids and sending them out. Yeah, Silicon Valley is the center of the world. Yeah, 80 % of the value generation in world in software gets generated in Silicon Valley, like 80 % of the world's

chip value gets generated in a couple of square miles in Taiwan. Houston would generate, it's the energy capital of the world. It knows how to do.

energy deployment and how to deploy to different sites. So we're tapping into that supply chain. We're tapping into that expertise. We're tapping into ⁓ that know-how. And it just happens serendipitously that that's the industry I came from. that lines up with a little bit of what we want to do, taking that Canadian program, miniaturizing our reactor. So LEU is now the new.

yet naturally enriched. yet products are the new projects. That's right.

Mark Hinaman (33:07)
Meaning there's an adequate amount of LEU in the supply

chain for, well, depending on who you talk to, there's not enough LEU right now. I think the industry is working on fixing that also. It's a whole separate conversation, but it should be more readily available than HALU.

Bobby (33:17)
Bye.

Yeah. It. That's right. That's

right. That's right. Yeah, it's it's, ⁓ yeah, enrichment is always going to be the constraining factor in any nuclear supply chain. You you can't let enrichment go crazy because you'll get bombed if you if you start enriching out of turn. Yeah, like, yeah, we're literally fighting a war right now on that on that point. And so you want to be as

uncoupled as possible to enrichment from a supply chain perspective. And so that's why we like LEU 5%. It's something that everyone's comfortable with. 20 % of the US electrical supply comes from it. Our incremental needs can be absorbed quite easily with the current supply chain, unlike potentially other for now. Yeah, exactly. Yeah, exactly. But it's a scalability.

Mark Hinaman (34:05)
For now, until you guys have hundreds of thousands of reactors running around, right? Yeah.

Bobby (34:14)
piece. that's kind of my learnings. was taking that really getting into the weeds on all the different reactor types, really honed in on the CANDU reactors, honed in on the whitewater reactors, because that's what the world chose to be economic.

Yeah, sodium fast reactors good for burning waste at the end of a cycle. You need one for every 10 ⁓ light water reactor, big light water reactor. Molten salt reactors make a lot of sense to breed fuel, ⁓ but they were never designed to be low cost electrons. And so... ⁓

we're a company that wants to make low cost electrons. And so we followed the money on that and we've navigated the business in that direction. that shows some of the choices. All the choices we make are in that vein from a process, from material selection perspective. Okay, so that's my understanding. then hiring people. that is...

Mark Hinaman (35:13)
next.

Back to the question, right? ⁓

Bobby (35:20)
Yeah, yeah, back to the question.

People are is always the most important factor in in any company and in particularly a startup. And so, you know, I was lucky enough. ⁓ Like I just it was just ⁓ networking and, ⁓ just bouncing through people. ⁓

that I met the president of the Australian Nuclear Association and got along with him well. And he became the chief nuclear officer. And then he had a great network and he had this stable of PhDs that had worked under him. And so he knew which ones were the high flyers and the independent thinkers and the self starters, because that's something you just can't, that's not something you can learn. ⁓

or it's very difficult to teach someone to be a self starter and to be the first principle thinker. ⁓ But yeah, he had him pre identified and we're like, Yep, let's, let's go out and find them. And yeah, they're working in. They're working in other startups and doing other industries and they love nuclear, but they left nuclear because nuclear was wasn't going fast enough for them. It kind of burned out that personality that that mindset. And we told him, Hey, we got

we got something that looks like a startup, but it's in nuclear. that was Lance, Lance Small, ⁓ Berkeley trained PhD. He came on and he's an execution guy. He can just make shit happen. And so yeah, he's the COO. yeah, it's through those networks. ⁓ Once you find the right sort of people that have that mindset, ⁓ they can

identify similar people with that mindset. Now you don't need all the, you only need maybe the first 10, 15 with that mindset and then you need to start specializing into certain areas. yeah, that's how, that's kind of, yeah, you go through, you gotta kiss a lot of frogs to find a prince. Yeah, yeah, yeah, so.

Mark Hinaman (37:36)
Yeah, so how

big is the team now?

Bobby (37:40)
We're about 20. We're about 20 people now. we're, when I say about 20, we're, you know, actively hiring and we got that offers out and yeah, we're, ⁓ we got some great, yeah, that's the thing I'm probably most proud of. It's not the technology. It's not the, yeah, it's not the location and the factory or it's the people we're bringing on board. And so ⁓

Yeah, if you're, yeah, if there's anyone out there that wants to wants to jump on a rocket ship and and get into it, yeah, reach out. Yeah.

Mark Hinaman (38:08)
Yeah,

you might be surprised. Hopefully some folks will reach out. Are you guys still bootstrapping? What's the financial situation looking like?

Bobby (38:17)
Yeah.

We're

right on the process of closing a big round. ⁓ My gut tells me to stay private, save private, save private. That's the best way until you've got a product built, sold.

regulatory approved. You only go public once you're ready to really launch. ⁓

But yeah, the public markets seem very open. We talk to a lot of public market people. ⁓ And so there may be that opportunity. And obviously X Energy had a phenomenal IPO last week. But yeah, at this stage, we're closing our first big external round. And we're bootstrapped basically to where we've got to now.

Mark Hinaman (39:21)
I mean, the advantage of private markets

is like the stock price only goes up generally. Right. So, you know, some benefit there, but yeah, not quite as liquid and fundraising is a slog. Yeah.

Bobby (39:25)
Yeah, yeah, yeah, yeah, exactly. Yeah, exactly. Yeah, yeah, yeah, exactly.

Yeah,

100%. But yeah, so that's where we're at on the capital raise side. But yeah, we've been blessed to not have to do too much of that today. Like we've just bootstrapped this.

Mark Hinaman (39:49)
Yeah.

So talk to me, let's nerd out a little bit, obviously, don't mind. don't need to give away any trade secrets or patent ideas or anything, but I want to hone in on the tech, right? Talk to us about this. I you've already said process, not projects. LEU fuels, water as a coolant, primary coolant, but what's this machine look like? And I think you gave a great analogy.

Bobby (39:55)
Yeah. Yeah.

Yeah, yeah, Yeah, that, that.

Sure, sure.

Mark Hinaman (40:21)
upon time. In one of previous conversations, was like, all right, how much material is in a caterpillar?

Reciprocating internal combustion engine, right? Like, can we have the same amount of mass in our nuclear reactor? If not, why not? anyway, talk to me, chief technology officer.

Bobby (40:29)
Yep.

Yep.

Yeah, yeah, yeah, sir, yeah.

Yeah,

so it's 5 % LEU, uranium dioxide is the fuel. ⁓ It's metallic clads ⁓ that we're using, standard qualified industry ⁓ cladding. ⁓ It's light water moderated. ⁓ And one of the key benefits of our moderator is that it's a... ⁓

it's not pressurized, it's unpressurized, and it's not at high temperature, it's basically cold. And so we get a tremendous amount of hydrogen density in the core for those, for the geeks out there. We have a phenomenally short thermalization length, ⁓ which means that...

when the neutrons are produced in the fissions, we slow them down and make them more available to create another fission very quickly. And so that's some of the benefits of our reactor physics with the unpressurized light water moderator. And that gives us an extremely compact core. There's no, know, we get about 40, 50 % more hydrogen density in the core than what you'd have in a PWR, which is like typically, you know, what is sort of the

benchmark for compact cores. And so ⁓ that's a huge benefit. And then that gives us a very small core that gives us a very compact shielding that limits the weight and enables us to be deployable. that's the moderator choice. And obviously, water is very, very inexpensive. Yeah, ⁓ it's a dollar a thousand liters or something like that. It falls out of the sky. ⁓

obviously you got to clean it up and maintain it, whatever, ⁓ it's a great material if you can use it. And then we're helium cooled on the reactor side. So there's some benefits with helium. It doesn't activate, it doesn't turn radioactive under a neutron flux. And so if there were to be a leak at the primary loop, or if we needed to vent off the helium in the system for ⁓

you know, potential accident scenarios. ⁓ It's basically like letting off a ⁓ balloon, yeah, like a party balloon. It's just, it's not going to hurt you. It's just going to dissipate into the atmosphere. And so they're the four key elements that you typically talk about with a reactor. The enrichment level, the clad, the ⁓ moderation and the coolant. ⁓

And so in terms of the architecture, we're a pressure tube reactor as opposed to a pressure vessel reactor. So it looks like hundreds of pipes welded up. looks like a shell and tube heat exchanger, which Houston produces literally tens of thousands probably every year.

Mark Hinaman (43:51)
You said shell and tube heat exchanger. Lots of these in Houston.

Bobby (43:55)
Yeah.

Yeah, yeah, like it's a very simple welded construction. It's something that's very scalable. It's something that you can line up and mass manufacture on an assembly line as opposed to your traditional huge stick fab welded construction of pressure vessels. And so, you know, we believe we're...

we're gonna be the first nuclear reactor company to be able to mass manufacture reactors. So we talk about stick build, we talk about modular build and the AP1000 is a modular build reactor. ⁓ Then we talk about SMRs, we talk about factory build reactors. ⁓ What we're talking about with our system, we're saying we're mass manufacturable and there's a difference.

Mark Hinaman (44:44)
you

Bobby (44:54)
from being continuous production, batch production, semi-autonomous production. So we think we'll be the first reactor that can be basically mass manufactured in a continuous process. And that's due to our material choices, that's due to our process choices. So our reactor looks like boilerplate and pipes.

So that's key.

Mark Hinaman (45:22)
Yeah. That's awesome. 40

% denser core than a PWR. Why? Walk me through that. What gives you that advantage?

Bobby (45:32)
Yep.

It's the fact that ⁓ water at one atmosphere and at low temperatures just have, it's just.

a lot more dense, it's 40 % more dense than water at 155 bar, 300 degrees, 330, 340 degrees C. So we just have more hydrogen in the core. And so that's more opportunities to slow a fast neutron down and get it thermalised to then create the next reaction. And so that's key. And so if you want to have a microreactor that's deployable, shielding,

shielding is basically the same thickness, whether you're this big or whether you're this big, your core. But obviously your shielding weight is tremendously, tremendously lighter when you have a compact core than when you have a large core. So I joke with the team, we are a reactor shielding company, as opposed to reactor.

Mark Hinaman (46:39)
The majority of the material is in the shielding. ⁓

Bobby (46:44)
Yeah, but shielding is cheap. shielding is actually very, very cheap materials compared to, yeah, complicated, compared to uranium dioxide, compared to building some of these bigger reactors. And so we can take that trade off. no, there's nothing, you know, there's never a perfect solution. Everything's always a trade off. And so our trade off is that, we have, our reactor looks like just a shielding structure and a containment structure and a protection barrier with a very small

core in the middle of it. that's the trade-offs we've taken there. Exactly. Yeah, that's a great way to put it. ⁓ Yeah, so yeah, I think that's a little bit on the reactive zone.

Mark Hinaman (47:19)
several cylinders Russian-dulled inside of each other.

And you guys drove this thing to Idaho. So, why are you in Idaho? You alluded to it earlier, but 94 days from signature to testing. This is the other transaction agreement with DOE.

Bobby (47:49)
Yes, so we had a, ⁓ it's called an SPP, a strategic partnership partner with DOE.

We expect to be one of a number of reactors to go critical before the 4th July. We loved what Valor Atomics did with their reactor, flying it from California to Utah. We thought we'd do something similar. And instead of a C-17, we put it in an F-150 and put it in the bed because it's small.

Mark Hinaman (48:27)
⁓ A

little more problematic. We're still bootstrapped here.

Bobby (48:33)
Yeah, It's literally the cheapest way to do it, but we had this phenomenal

event at the Utah State Capitol. We had senators and congressmen and we gave a great presentation and then they came down and it was on the steps of the Capitol building there. If you've ever been to Salt Lake City, it's an amazing location for the Capitol. It looks out over the whole valley and it was still snow capped and whatnot. And we had like everyone clambering up wanting to get in the bed of the truck to have a look at this reactor. And we're making it

feel real, like making it not a big scary thing, making it look, this is a really simple engineered device. It's inherently safe. ⁓ And we want to be able to build in a factory and drive it to location and install it and turn it on. We're doing the initial demo of what we want to be when we grow up as deployable energy. And so first reactor is going to deploy like

the thousandth reactor air touch wood. We built it in our factory and we drove it to location. So we're getting it installed at the Idaho National Labs. That's the facility that will have all the instrumentation and all the expected infrastructure to do a first-of-the-kind test. ⁓

And then from there, we'll go critical. And then it's a series over the next year or so of tests to prove out the reactor physics and the reactor safety. we'll do a full loss of coolant accident scenario. One of the harshest scenarios now, if you did it in a big reactor, you'd melt it. Here, we're going to do it and we're going to show that it's inherently safe. It's just going to dissipate the heat. It's going to naturally shut down.

down without any operator intervention and ⁓ without any damage to the core. And yeah, the manager and startups fail fast. Yeah, we're to do this test like as soon as we possibly can once we get the equipment in place. And we can demonstrate, like even if there's no cooling in the reactor, this thing will just naturally power down and be inherently safe. And we're to do it in a form that's mass-manufacturable that I can buy from the

supply chain. It can scale to meet the demands that, you know, the challenge that we have in the energy complex right now. So, yeah, that's what we're doing. We're going go critical before the 4th of July. And then we're going to go through all our safety work over the next 12, 18 months and then hopefully be commercial before 2028.

Mark Hinaman (51:31)
Nice. Are you guys using the DOM at INL or is there a separate site or facility that they're setting up for you guys to do some testing at?

Bobby (51:40)
So one of the benefits of our reactor is that we're smaller than four feet in diameter. We're actually substantially smaller. So we can go through a door, which I didn't realize it was a good requirement to have, or a good spec to have, but we can fit through a door, and that means we can go into a tremendous amount of places to be able to do this test.

Mark Hinaman (51:47)
So we got a hole in the ground. ⁓ yeah.

Ha

Bobby (52:05)
And so there's a really great facility. called the NRAD facility. It's the National Radiography Analysis. ⁓

I can't remember what D stands for and they're to kill me. it's basically in bottom of the HFEF, which is the Hot Fuels Examination Facility at Idaho National Labs. we can, from there, ⁓ we can basically do all that testing that I talked about in that facility. And then at the end of that testing, we can go into the world's biggest and premier ⁓

Hot Fuels Examination Lab to cut up the fuel, show what happened during that life cycle of fuel. And it's literally in the same building as basically everyone else would be sending their fuel to do this. So it's a streamline. The beauty of being so small is that we can have this streamlined test campaign at the lab.

Mark Hinaman (53:12)
I neutron radiography reactor. So there is no, I think the brat is just for radiography. So get out jail free card there.

Bobby (53:15)
Yes.

Yeah, okay, there you go. Yeah, yeah, all

right. Yeah, we've got, they've been phenomenal. Bill Wakeman, Mike Ruddle, like these guys are doing God's work. Yeah, all the way up, you know, through the chain. Stuart Jensen, Ron Crone, Bob Boston, Rhian. These guys, yeah, right now, like the industry's soul-lined. We're all engaged.

⁓ We've been energised by the goal of having three reactors, one by the 4th July. The next goals have been set with the Launchpad program.

Mark Hinaman (53:52)
Yeah.

Bobby (54:01)
It's the most exciting time in nuclear and I can say that because I'm surrounded by a whole heap of 30, 40-year veterans that have seen three nuclear cycles and they can say this is 100 % the most exciting time in nuclear.

Mark Hinaman (54:18)
Yeah, let's not mess it up Bobby.

Bobby (54:21)
And

we're going to be vigilant. We've got to be vigilant. yeah, my core, my first entrepreneurial venture was to make the oil and gas industry safer. We're going to do the same thing here. We're going to make the nuclear industry safer and we're going to make it more productive.

Mark Hinaman (54:37)
man, this the safe, I mean, this hot take, but the safety thing is unnecessary. In my opinion, it's more make nuclear cheap again, or make nuclear economic again, right? Like, think your approach is steering towards that goal. So, so you're gonna do tests for about a year once you get this thing critical. And then what next if all goes according to plan?

Bobby (54:46)
Yeah.

Yes, 100%.

⁓ We want to build out ⁓ a gigawatt factory in Texas. So that's the ability to make a gigawatt of capacity per year out of that facility. We have ⁓ over $10 billion in LOIs ⁓ with a whole heap of different verticals from...

Yeah, yeah, I hate to lead off with it, but data centers to to behind the meter. ⁓ Yeah, industrial parks to to agriculture. Yeah, there's a tremendous amount of just a tremendous amount of energy gets used in agriculture to to maritime applications to port operations to you name it like everywhere where there's an industrial use of electricity. That's where we want to

be as we want to co-locate with. yeah, we've got a tremendous backlog and it's not just concentrated in one sector or another. If you see a diesel generator there before, we'll be there soon.

Mark Hinaman (56:10)
Yeah.

⁓

What a great approach. Yeah, I hope so. So let's go make it happen. ⁓ Bobby, any closing thoughts? mean, what a great way, great spot to end it for you, but the industry ⁓ more broadly, like, do you think the rest of the nuclear industry is going to keep up? I mean, so what a great time for the industry collectively as a whole.

Bobby (56:19)
Yeah.

I think there's just tremendous bipartisan support. Every lawmaker that I've talked to, every regulator, every ⁓ administrator is...

knows that this is something we need to do. We have to be vigilant. Like we can't let one bad apple, you know, ruin this. you know, one accident, it ruins this whole adventure that we're on. And so we do need to be vigilant on that and make sure that we, you know, we're not, this streamlining is not skipping the requirements there.

ensuring that it's economic and ensuring that we've got the requisite amount of safety. But no, I think we've got a great decade ahead of us and it will be the rejuvenation of ⁓ the American dream and American manufacturing and it will make the 21st century the American century if we can pull this off.

Mark Hinaman (57:51)
I love it. That's a great place to end it. Bobby Gallagher, super fun to chat. Thanks so much for the time, man. Excited to see you guys'

Bobby (57:54)
Yeah.

Yeah, cheers Mark. Can't wait to catch up in Denver. ⁓

Mark Hinaman (58:05)
Sounds great.

‍