This has been done before. You just need to split the water into hydrogen and oxygen. Only one catch: that takes energy. It's a good party trick, but of no real practical use.
He is saying it produces a very high octane fuel which means it produces more energy, a ratio which is paractial use as fuel. This is why he says:
LOL, scratch that as I was google for his quote I found this instead: Leading respectable Pakistani paper
THIS wasn’t the first time a local version of a car purportedly run on water was being displayed in Pakistan. Like every other part of the world, the country has had its share of dreamers run on a desire to replace the current automobile with one that moves either exclusively on water or on a mix of water with a variation of oil. It was the presence of Khurshid Shah, the religious affairs minister, at the preview of the new water-run model that lifted the event from being just an ordinary show of laudable intent into a celebrated launch the government was willing to place its faith in. This was a rare occurrence, a brave show by a government whose previous flirtation with energy matters has only fuelled criticism. The minister was not only there at the ceremony in Islamabad on Thursday, he actually drove the car around. His predictions about the success of the much-awaited car, he said, enjoyed the support of no less a person and no less a seeker of energy in the country than the prime minister. The minister of science and technology was also present and called it a gift to the nation to mark the upcoming 65th anniversary of independence. For the gift to materialise in time he announced “all required” tests would be completed in the next two weeks.http://dawn.com/2012/07/28/water-for-fuel/
It is a test previous such models have failed to pass, unfortunately. The details of these failed experiments will make a thick book full of technical jargon but one old point these experiences reiterate is that it is always better to wait until you are done before you come up with a declaration about a scientific discovery. The experiment may take two weeks or two years or two decades, and as yet lead to nothing new, necessitating a fresh trial altogether.
So either the dude is lying or they've found a way to produce more energy then the put in without violation of the laws of thermodynamics using water. Am more inclined to believe the dude is talking out of his backside for the moment.
Since water does not produce heat energy there are extracting the energy using some other method (i.e. you can't burn water) so basically he is saying on one litre of water a engine of 1000cc can cover 45km that means its producing enough mechanical energy to actually make it practical. So again I want to know how he got this to work within the 2nd and 3rd law of thermodynamics.