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In d20 Modern there is a rule that says typed damage (except acid) does half damage to objects. I was browsing through the explosives section and found thermite grenades which do simply 6d6 fire damage.

Would that fire damaged be reduced by half? Would thermite by the rules be useful at all for destroying machinery and equipment as the description says?

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RAW, Yes, it would be reduced. Yes, it sucks. (6d6/2)-10 = .5 points of damage to steel. I would give it the ability to bypass hardness, which would make it more useful - compared to a frag grenade, 6d6/2 (10.5) vs 4d6-10 (4) points of damage. I'd do the same for det cord.

It's still a bit weak compared to what it's supposed to burn through. I'd make it burn for 6 rounds, if it is in direct contact with something then it continues to damage it. (Real thermite grenades burn for 40s - http://www.fas.org/man/dod-101/sys/land/m14-th3.htm)

Although, keep in mind that someone with the Demolitions skill can get double or triple damage out of placing a charge. So don't beef it up too much more than that.

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