The basic operation is pretty straightforward. When a gas is chilled to a very low temperature, it becomes a liquid. Air itself, once turned into a liquid can be stored in an insulated container, not a high pressure cylinder, so storage is actually quite easy and fillups are relatively quick. If you introduce the liquid air into a confined space while exposing it to ambient temperature, the gas expands rapidly, creating high pressure as it returns to its gaseous state. You can use this high pressure to drive a piston or spin a turbine and the gas itself is the exhaust. There's no burning to create any other chemical compounds, you've simply chilled a gas that naturally occurs, then warmed it again to return it to the atmosphere as a completely non polluting exhaust, cold air.
The problem is coming up with a way to heat the super cooled liquid efficiently, and Dearman uses a recirculating fluid that runs through a heat exchanger, though the engine can also be used in conjunction with a regular internal combustion engine, using the waste heat from the ICE to warm the liquid.
There are several examples given on the company website of this engine being used in vehicles, but the real future for this engine may be in stationary applications where it can make use of the waste heat generated by other processes.
Dearman uses liquid nitrogen in his demonstrations, but says liquid air is what the engine is actually designed for. Maybe it's just me, but I've never heard much about liquid air, oxygen and nitrogen of course, but air? Perhaps because there's not much use for it that we don't see it produced, but with the Dearman engine, we'll have a reason to chill the very air we breathe and change it into a fuel for our cars, or as a way to store energy produced by those intermittent sources from the sun or wind.
The company is currently working with Ricardo Engineering to turn it into a commercially viable engine. Pretty cool, ...or should I say, very cold?
Link: Dearman Engine