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Default Lightweight diesel

One of my technicians races those 1/8 scale cars with a tiny engine.
He also custom makes the components with the CNC mill in our shop. I
was looking at one of the engines on his bench and noticed there is no
spark plug and realized it worked like a diesel. He tells me it burns
a combination of Castor oil, kerosene and nitromethane. It does have a
carburator. It is air cooled and puts out 3 hp and fits in the palm of
my hand.
Could the same technology be used to make ultra-lightweight diesels for
outboards? Of course you'd want real fuel injection so you didnt have
to use the nitromethane (fuel atomization I assume). The cylinder
would have a high strength sleeve insert that could be easily replaced
but the rest would be made of Aluminum.