Great to chat with Rainer Küngas, CTO at Stargate Hydrogen. Stargate Hydrogen delivers turn-key solutions for electrolysis plants and hydrogen trains! We discussed retrofitting freight locomotives, zero-emission hydrogen, hydrogen production by electrolysis, Estonia as the European Silicon Valley and more!

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James

The unedited podcast transcript is below

James McWalter

Hello today we’re speaking with Rainer Küngas CTO at Stargate Hydrogen Welcome to podcast Rainer. Great to start. Could you tell us a little bit about stargate hydrogen.

Rainer Küngas

Thank you so much for having me.

Rainer Küngas

Yes, we’re a company about 1 year old and we are focusing on 2 main aspects of hydrogen technology on 1 hand we are developing 0 emission hydrogen-based locomotives. Um, and at the same time we’re also developing and and establishing hydrogen production systems based on electrolysis. So how to make green hydrogen with the help of electricity and and water.

James McWalter

And what drove the initial decision. You know a year. Maybe a little bit further ah long ago to start Stargate.

Rainer Küngas

Um, yeah, so I um, kind of have been working in the hydrogen space for about half my life. So what’s that 1520 years and and you can really see that there is momentum in this field at the moment. There’s a lot of you know things happening the countries are coming up with their plans for how to get to net zero how to establish more and more electrical electrolysis capacity and so on so it was really this momentum that. That drove us to establish stargate hydrogen and um particularly we we saw these 2 areas where there was where where we so where we saw that we have something unique to offer so in the case of locomotives. Ah, we could see that this that this market of of you know, true zero emission locomotives was about to pick up and and there was a clear demand from the from the market side. Or more solutions like that and and on the electrolysis part we were. We had this idea to develop a new class of electroizers. Um, which is where we what we’re now doing and. And getting closer to commercialization.

James McWalter

That’s super interesting. It’s just on that first use case so locomotives what is the kind of current status quo of locomotives trains in terms of the type of energy use and I guess water are the kind of advantages of Hydrogen versus the status quo.

Rainer Küngas

Yes, so the um, the majority of of locomotives today run on diesel essentially you have 2 technologies competing at the moment. It’s either. You know, um, electric locomotive is powered by catonary lines. So the overhead lines. Or you have diesel locomotives and in the us it’s actually almost exclusively diesel locomotives. There’s almost no electrified rail in in the us at all. Um, and it’s ah it’s a it’s a. Huge market in the in the us alone. There are 25000 class one locomotives operating and most of them are quite old. The average age is about 30 years in Europe it’s actually forty years that the average age of a locomotive is so you can imagine how much they emit not just co 2 But also you know, partic emissions Nos and so on um, and and and. To to kind of but in the future you know, like ah as countries have this target to go towards net zero then all areas of the economy need to decarbonize including the really hard to decarbonize sectors like like rail transport or heavy heavy transport. In general. So um, and and rail is you know the typical lifetime of a locomotive is perhaps you know if average age is 3040 years then it’s maybe 50 years so um so it’s if we want to get to net zero byte. Ah, twenty fifty then we need to do something without locomotives already today. Um.

James McWalter

Yeah, that’s that’s that’s interesting. So I guess and to take those kind of 2 competing ah kind of technologies as they exist today. So you mentioned you know basically electrify locomotives electrify trains and you have these overhead wires again much more common in Europe.

James McWalter

And and Asia then you see in the United States and then you know for the audience if you you know picture the old west you picture these steam locomotives with steam you know with with smoke coming out the top from the coal. Um, you know we’ve obviously moved on from that but we’re still using diesel which is very kind of dirty and polluting fuel I guess why? why. You know because my understanding is that the electrification is like you know that kind of next evolution of the diesel locomotive historically um, before you know the reasoning around hydrogen became kind of more compelling I guess why? not you know, try to push to you know to decarbonize locomotives into. Ah, electrification rather than through something like hydrogen. You know what are the other kind of pros and cons of hydrogen relative to electrification.

Rainer Küngas

That’s a really good question because um, many countries in Europe for example, are actually pushing electrification really hard this just means a really huge investments like capital investments. In in the rail tracks. So we’re talking about an average I think between 2 and $3000000 per per kiloometer of of track electrified. So you know if you want to do. Even in in a small country like Estonia. You know we have a thousand kilometers of of railways that needs to be electrified and it it all boils down to how how often do you use or how heavily these rail roads are being used if it’s used. Really intensively the electrification using overheadlines makes a lot of sense but you know even in countries like Germany then which you know we have really extensive railway networks and both you know. Also a lot of them electrified then the level of electrification is only 50% of the overall um you know overall track kilometers so you have these always. We’ll have these railroad track sections which are used less than the main lines. And it’s on those lines where where hydrogen is the most logical option because because you can kind of envision it as doing wireless electric electrification. You replace the the diesel engine on the locomotive. With ah with ah a fuel cell and then that will provide electricity that you use to run your your diesel locomotive traction engines. Okay.

James McWalter

And yeah I guess when I think about electrification of Rail One of the big you know blockers for it is basically local opposition to having the overhead wires and so you’re seeing.

James McWalter

You know and I’ve used the word nimbia in the past on the podcast but people ah you know ordinary people generally you know I’m I’m not not saying that these are bad people or anything but people who don’t want to see certain types of infrastructure in their backyard near near their homes. All those kind of things but things have to be built somewhere right? and so you you constantly have this kind of. Clash between um, building certain types of infrastructure versus local opposition and I guess one of the interesting things about going with hydrogen is the the tracks have already been built. You don’t have to change that rather you’re changing the vehicle on the tracks I think that is definitely compelling in a lot of cases. Um, I definitely would also like see us send up more than nimbyism and and then then push back on ah the the you know the kind of the push well pushback on the pushback of the objections to some of this kind of infrastructure build out. Um, but I definitely see that as an argument where you have particularly strong and trenched interests that will. Basically just not allow. Um you to build the electrification that might be needed in particular you know Geographic area.

Rainer Küngas

Yeah, so maybe it’s to comment on this then one of the applications of hydrogen locomotives that we see as like maybe the you know some one of the first applications is the use of um. Locomotives in railyards these are these um locomotives are typically referred to as shunting locomotives in Europe or switcher locomotives in in the us so these are the locomotives that kind of assemble and disassemble. Ah, the. Wagons or cargo or the you know the um the the large trains and then it’s another type of locomotive called mainliners. Then that that then transport these long trains over a long distance. But um, those switch are locomotives they’re typically you know. Oldest and most polluting ones that you have in your locomotive fleet because maybe you don’t can’t rely on them anymore to to operate on ah you know and on a um, long distance track? Um, but you want to have them in the railard where. Easier to maintain them or service them and and you know at the same time these rail yards are often located in urban areas where air pollution is you know a big problem so to replace those switcher locomotives. Is a really a low hanging fruit in terms of you know you you both get your benefits of cleaner air in urban areas and you also take some of them. You know the most oldest and the most unreliable locomotives off the rails.

James McWalter

That that makes a ton of sense and then I guess this other kind of use case the electrolysis itself. What is that kind of current process today and I guess what are the kind of innovations. You’re kind of working on bringing to market in that space. Yeah.

Rainer Küngas

Yes, um, so there are in general um 3 different kinds of electrolysis technologies. There’s the one called alkaline electrolysis. There’s the one called. Um, pem or polymer electrolyte membrane electrolysis and then there’s high temperature electrolysis. Um, we at stargate are focusing on the very first one. The one called alkaline and and if you zoom in through that type of electrolysis more then you’ll see that this. And again kind of has 2 different kinds of technologies in there 1 is based on precious metals. We’re talking about you know, not even silver or or gold but more like platinum iridium ruthenium really the rarest elements that you can find on earth. Um, the the kind of interesting thing is that this these elements give you unfortunately the the best activity and the you know the highest current densities and the the best performance but but sourcing. And availability is really an issue I I made this back of then will calculation that if you took the entire global production of iridium for 1 year and only used it for electronizers then you could install one Gigawatt ahualizers per year I mean this is a lot compared to how much we produce today but to put it in the in a perspective then the european union alone wants to install between. 40 and sixty Gigawatts of electizers by the year twenty thirty so even if we used all of the world’s iridium and only used that to make electronizers then there simply wouldn’t be enough of those rare metals available. So so we need an alternatives and there is an alternative and this is typically nickel based electronizers. You know you have much less of an issue with raw material availability. But unfortunately also these electizers have much lower performance. Lower current densities lower efficiencies and what we then want to do at stargate is to develop a third class of alkaline electroizers 1 ne’s based on ceramic active materials and um, ah it has been.

Rainer Küngas

Shown in the lab that that these ah electroizers are just as active as the precious metals ones. But at the same time you don’t have these raw material availability issues. So it kind of combines The best of both Worlds and this is the technology that we want to scale up and commercialize.

James McWalter

That makes sense and and just for the audience who I know we come in deeply talking about electricalizers but electroalizers are basically just a technology to separate water into the 2 component elements of water which is hydrogen and oxygen and so that’s why it’s you know so so important to the hydrogen industry and. Guess then in that kind of third that third piece so you know looking at your background. You know you’ve worked on different types of you know ceramics and have you know have a very strong kind of academic career as well as commercial career career working on these kind of technologies. Um I guess what? what is the you know. What is the state of play with that technology today. Um, you know? are you some the lab are there kind of initial pilots happening of the the technology around electrolysis. Yeah.

Rainer Küngas

Yeah, so um, so yeah as you rightly pointed out. Electrolysis is really like a key technology if you want to be able to kind of decouple the production of fuels like hydrogen and but also later on some synthetic fuels. From co 2 emissions. So if you use green electricity for producing hydrogen then and and you use electricity electrolysis for that then then then this is a way to produce fuels without co 2 emissions. So this is why we’re doing this and why why. Green hydrogen is so high on the agenda um with coming coming to your question then we are at the moment busy working in the lab developing the first materials and the first electrodes that we will that we will test and then. Gradually increased the the size of the systems so that we can get to commercially relevant sizes quickly. But at the same time. Um, so we don’t want to be be like ah you know a 2 academic of ah of a company. So if you. If a customer comes to us and wants to buy an allegizer already today then we offer that as well. It’s just that if you then at some point want to upgrade the existing electroizer stack with with the with the new one that we’re developing then then. That is certainly an option.

James McWalter

Understood and in in terms of like electro like electroalizers you have you have the underlying kind of chemistry that enables you know that that conversion right? like whatever that kind of internal catalyst is whether there’s rare or metals as you discussed. Um.

James McWalter

You know, Nickla or ah ceramic kind of approach. You’re taking but the other kind of major input is electricity itself so you need some energy to to cause that ah that reaction to occur and you know historically ah that energy has come from dirty sources and and you mentioned the importance of using green sources for this.

Rainer Küngas

Yes.

James McWalter

I Guess how much of a bottleneck is ubiquitous green energy to the scaling up of hydrone electrolysis for the types of use cases. We’re talking about you know where would we need to see you know? Ah, do we basically do we have enough solar and wind and and Hydra right now or a nuclear as well to actually? ah. You know meet the demand of potential Hydrogen applications or do we have to build ton more.

Rainer Küngas

Here again I would just want to start from a bit further and then get to your Aor E So like ah to put things in perspective then if you if you today if you take natural gas and convert that into hydrogen.

Rainer Küngas

Using the normal process of steam methane reforming and then you know you have some emissions actually about ten Kilos of co 2 per every kilo of of hydrogen that you produce so we’re talking about really sizable. AhCO 2 emissions if you then just you know either burn that hydrogen or if you use that hydrogen in ah in a fuel cell for example to power a fuel cell locomotive. Then if you kind of Zoom out and look at the overall emissions then you have produced actually more co 2 emissions in this process then if you just had burned this natural gas in the in a gas engine instead. Um, and so you know this is this kind of hydrogen produced from natural gas is called grey hydrogen. Then you have the ah hydrogen produced from electrolysis and if you use a really dirty electricity to power your electronizer then again you you may actually be much worse than if you just you know burn the fossil fuel. Be it. The. Oil or or coal or whatever in them in an engine somehow itself. So. It’s really only if you have green electricity available that that electrolysis starts to make sense and. Green hydrogen starts to make sense so it is it is like really really important that that there is enough of green electricity available and it’s certainly not trivial actually. Ah. In to fulfill these these goals that the the european union for example, has taken. It requires really massive installation of new renewable energy capacity. So you know gigawatts and gigawats of. Of of solar and wind. It’s it’s certainly an issue and I truly hope that the that the rate at which solar and wind get installed in really all across the world and like. Takes up in the in the in the next years

James McWalter

Absolutely as we all do have I think for the people who can listen to this podcast and then if if I think about like the other potentially use cases for hydrogen. Um, you know some of the ones that either we’ve talked to people in the past on the podcast or I’ve come across recently with my own company. So 1 is long duration storage right? So we one of these issues with the grid where the um, yeah, the renewables that we’re adding more and more of they’re intermittent. You know the sun does not shine and nice as is is very commonly so spoke about and the wind obviously doesn’t always blow.

James McWalter

And also certain times a year yeah the sun shines more right in Summer. So can you capture more of that energy at the moment and deploy it on the bridge when it’s more needed in the evenings and so on the big problem right now is that most of our storage technologies are either dirty or battery based which have a 4 to 8 hour max kind of timeframe for their use case. From a kind of economic point of view hydrogen is seen as this kind of more more akin to something like natural gas because you can basically you know produce it in the summer let’s say store it in tanks and then burn it off as a form of energy in the winter as an example, um, so that’s kind of 1 1 example, another example is around. Other types of vehicle locomotion not not locomotives but things like heavy heavy trucks. Even we’re starting to see some startups kind of explore things like aviation with hydrogen and then and shipping as well as another big one. Did you kind of think through these other use cases and I guess.

James McWalter

Why were locomotives and like I guess like the electrovisor itself is like more of a kind of enabling technology but in terms of like end use case Technologies I Guess why were locomotives more interesting relative is some of these other options.

Rainer Küngas

Ah, yeah, just to comment first on the the first part of your question. So um, hydrogen storage I think makes sense but you need to have some really like good conditions for it. So for example, storing hydrogen is just. In in high pressure tanks I think is unless there’s a real breakthrough in hydrogen storage technologies. It’s quite challenging I would rather like typically you would like you would do that like seasonal storage if you have some like. Geographic geologically favorable area where you can pump hydrogen and under the ground like in a salt cavern several hundred meters underneath the the ground ah where you can be sure that the hydrogen doesn’t get get out doesn’t leak. Um. And and and where you have these you know the volumes available where where long-term storage makes sense but to to store hydrogen on like in um, on the ground hydrogen tanks. That would be large enough for seasonal storage this I’m I’m not seeing at the moment these kind of projects materializing I think that the the cost of storing hydrogen is simply too high. Ah, on the other hand if you do something with hydrogen like green hydrogen is the first step in the production of you know all sorts of green chemicals. Be it methanol you know, synthetic natural gas also synthetic. You know. Liquid fuels like synthetic diesel and so on. So if you combine green hydrogen production with ah with some synthesis like that also ammonia forgot to mention so these kind of fuels are much much more easy to to store over. Long time and as a matter of fact, you can use the existing infrastructure right? You know synthetic natural gas you can pump it into an existing natural gas pipeline synthetic diesel you can blend that with ah with ah you know regular diesel. so that ah so that you yeah it might much more easier to store and at at lower pressures as well. Um, so this is this is where I see the world going I think that.

Rainer Küngas

If you need to store things over a long time or even transport hydrogen over a longer distance then you would convert it first to something hydrogen derivatives like they’re called um and then perhaps even convert it back to hydrogen when you need to use it. But.

James McWalter

So then I guess so I understand the kind of look the locomotive kind of case would then the production of Hydrogen be ah co-located with the the train yard in order to have remove some of that storage issue that you mentioned.

Rainer Küngas

Ah, yes, ideally you would have hydrogen production and and like ah hydrogen refueling station in the railway Hubs so that so that. The the locomotives and and Passenger trains can come there for for refueing and the like it. You don’t really need to have you know huge solar parks or or wind the farms. At these locations. So It’s ah it’s actually quite quite doable.

James McWalter

And and so and then those other kind of use cases. Um in the transportation. Space. So You know have a machinery aviation shipping and so on. Um I Guess how do they compare in the in the kind of framework that you kind of mentioned in terms of like. What when a good use cases and as I’m really kind of enjoying getting into the details of this because I think whenever we see Emergent Hot New Technologies right? Obviously Hydrogen production’s been around a very long time. But.

26:44.82

James McWalter

Um, you know it’s definitely something that ah is is top of mind for a lot of policymakers. A lot of industry people industry and across the sort of Landscape. It’s like okay maybe it’s a silver bullet bullet for every use case right? whereas we have to be I think you know, really clearly look at the technology and say okay, this really makes sense in certain use cases and and maybe less than others. And so yeah, So how do you think? and then when you apply that framework to these other forms of transportation. Why Hydrogen may be a good or less good choice for those and.

Rainer Küngas

Yes, um I think it’s It’s a like a good way to look at it. This would be perhaps to like try try to think of it like as ah as a spectrum of Applications. So we’re on 1 Ah, edge of the spectrum you have these really like low energy applications. Like for example, you know electric bikes Scooters Passenger cars. Um in in that kind of corner of the spectrum I think that battery technology is doing really well. And um I I Don’t think that we are going to see like ah hydrogen powered bicycles taking over the world in the future. But um.

James McWalter

Right.

Rainer Küngas

And then then then you have kind of this ah middle part of the spectrum where you have you know you have locomotives you have ah coaches that. Operate between cities. You know that essentially need to be driving all the time and you cannot afford to have it plugged in you know after you, you take the bus from New York to to Philly where I also lived and. And then they they plug in the the bus after after that trip for for several hours before you can make the return trip. So I mean this just simply doesn’t work so in these applications hydrogen has a clear edge over battery um technology. Um. And then in the far end of the spectrum you then have you know oil tankers real big cargo ships. Ah passenger long haul aircraft and so on where where even the energy density of hydrogen.

Rainer Küngas

Not enough and there you’re going to need green synthetic fuels like synthetic jet fuel synthetic diesel perhaps green ammonia for the shipping industry but but there also you have green highrogen is the first kind of step. In in making those those fields so this is at least how I see the world.

James McWalter

Sure, yeah, no absolutely that that all makes sense and I guess then kind of returning to kind ofs star gate. What are the kind of goals over the next. Let’s say 6 to twelve months some milestones that you’re hoping to reach. Yeah.

Rainer Küngas

So we are really busy designing our first locomotive prototype and so I would very much like to to present the you know the the first. Working prototype of our hydrogen locomotive in in that timef frameme on the um on the electricalizer and development. Um, we want to get to First. Ah. Lab scale results that that we can share with the world and also that we that we can start testing our our technology together with some partners. So. Really talking about proof of concept in in kind of both business lines at the moment but and maybe as a third point kind of that unifies those 2 things is which simply want to grow as a company. We. Moment were about twelve fifteen people I think that by the end of the year will will probably be around um double that or maybe even more than that.

James McWalter

And and I guess the in terms of like the the early team. Um, who who who’s kind of involved in that. Um, how did you meet those people like you know how do you kind of build out the relationships with the you know the early founders early team mates and and oh. How you kind of all got to know each other and decide like this is the thing that you want to work on together.

Rainer Küngas

Um, so Estonia is like this at least we consider ourselves like this the world of or like ah in in a way the Silicon Valley of Europe I know some.

Rainer Küngas

Like at least this is how we think of ourselves. There’s quite a lot of ah nice companies that have come out of Estonia to maybe to name a few then like an early success of Estonia was Skype. That’s maybe not so ah, you know relevant anymore. But at the moment.

Rainer Küngas

Um they’re also some really nice companies and and so it’s it’s this kind of startup scene that has also been active in in in helping to establish stargate. So one of our founders for example is. Is a real pioneer in the field of super capacitors and and another one of our initial investors is the main investor in a. And the largest renewable energy producer in Estonia so it it just was a really good combination kind of combining the knowledge from the renewable energy field and and this understanding of how to scale up new technology. So. Really kept slicing on on this.

James McWalter

Why is Estonia ah better at startups than a lot of Europe and you know I’ve mentioned the podcast before in Ireland we do not do a good job at startups you know and a lot of that is on cultural elements right? You know we we live a good time. We are very you know, friendly people. But we’re also. So more critical of the success of others I think it’s fair to say and so that definitely um, you know, basically the idea of bragging about like your startup and say I just started this something I mean there’s no quicker way to get made fun of in Ireland than than saying something like that. So I guess how do you think about? yeah, are there cultural elements or even you know policy elements that have made Estonia that kind of. Center of so much startup activity and.

Rainer Küngas

I think it’s maybe difficult to pinpoint like 1 specific thing but there has been really a lot of support from the government side on the on like Estonian ii sector. So. Have done some I think nice things there like for example, this initiative of e residency that you can be a resident of Estonia without you know, physically having to be here and kind of getting the perks of being an european union citizen and ah, um. And this I think kind of helps to spur the Estoian startup kind of scene but by now it has really moved into you know the scope is much broader than just I see so you know green tech also um. Like medicine and health technologies. But yeah, I’m not so easy to say exactly what is the reason.

James McWalter

And and you mentioned the and that that kind of innovation that’s happening in Sonia and not just in etonia but kind of around the world like where are the areass though that we’re not seeing enough innovation. You know if somebody was like oh I might want to start a company that’s tackling some big problem. Um, particularly in the climate space where are there areas that like. More smart people should be focused on in your opinion. Um that we just don’t have enough you know startups being formed ideas being you know, attempted to turn into business that kind of thing.

Rainer Küngas

Um, there are some areas which may sound boring and I mean so ah, for example.

James McWalter

No such thing in startup world. Ah.

Rainer Küngas

It’s like 1 really important topic for for renewable energy and also like green hydrogen in general is everything that relates to standards and guarantees of origin and you know things like that. How do you make sure that if you actually produce green hydrogen that you know. That you can also sell the green hydrogen that is considered as green hydrogen and that the same time that you cannot sell it somehow twice that you sell it to 1 person and then you also sell it to another person or under company and how do you make sure. For example that the that the. If you use and if you buy a green electricity that it is also actually green. Not just you know, ah that 1 at 1 moment in time somebody produced green electricity. But what you’re getting ah through the lines is actually electricity from coal. It’s um, to me at least it’s an incredibly incredibly boring topic but it but it and and and really ah you know heavy on on on the like legal aspects and ah.

James McWalter

Business.

Rainer Küngas

But it’s extremely necessary without this then actually there will be no massive scale adoption of of Green Hydrogen technologies.

James McWalter

Yeah there’s ah this guy saw griffiz you might have come across him. He wrote a book about kind of electrifying. Ah yeah, the economy in the Us. But you know he’s got this line that yeah even lawyers have a role in in the kind of green future right? like navigating these these kind of different waters. Um. We’re absolutely you know essential and a company kind of agree with that. You know I think wherever there is a yeah I guess I have a think about like how to like the kind of modern technology that started in the late 90 s you know was very much driven by software sliding in to ah. Kind of new use cases right? You know the emergence of things that had never existed before like social network and so on Google etc and over the last like decade we’ve really seen you know software just starting to eat more and more into very old industries like change how they work how they operate all those kind of things and. That is basically just started right? like I come across. Um, you know my own startup like everyday like industries that are using. Um, basically you know pre-exel models from like 1988 to run things like the electricity grid and so on and nobody.

James McWalter

Like literally at the company knows how to how to fix it if it breaks like it just doesn’t even exist anymore and and we just have these things all the way down the way and so I think like you know my message is always just start talking to people in these industries and they will just start describing the status quo and I think people who are coming from a technology mindset will be so much shocked in a positive way that like oh these are massive opportunities.

James McWalter

To try to improve on great. Um, so ranar it was. It was great chat and before we finish off is there anything I should have asked you about but did not.

Rainer Küngas

I Completely agree with this.

Rainer Küngas

Um, yeah, maybe when would the you know 1 be able to see a first stargate locomotive running. And yeah, the us. Yeah because ah.

James McWalter

So yes, yeah, I’m very excited. What’s the timeline for this? yeah.

Rainer Küngas

The the interesting thing with our prototype locomotive is that we’re actually converting an american origin locomotive like ah through some well kind of an interesting story then in a Stonia. We. Almost exclusively use american general electric locomotives. Um whereas all the countries around us are using either. You know european or or russian technology and but and this is kind of. Going to be our entry ticket into the and into the us market. So our idea is that once we have have built the prototype. Um, then we will also get it certified on the us market and and and bring it bring it there. So so because there’s actually you know hundreds. If not thousands of of similar locomotives in the us just waiting to be retrofitted with with our technology.

James McWalter

Yeah, it’s that’s super exciting and I’m looking forward to that to that news. Ah Reiner. Thank you so much.

Rainer Küngas

Thank you.

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