An internal combustion engine power cycle wherein a combustion chamber is fitted with an inlet valve, an outlet valve, and movable piston coupled to perform work, includes an generator to form a stream of greater than about 95% molecular oxygen from atmospheric air and a nitrogen waste gas stream; a source of fuel; and a source of liquid water. The power cycle includes admission of the molecular oxygen into the chamber, injection of the fuel into the chamber with combustion, and injection of atomized water into the chamber for generation of steam.