Near-earth asteroids contain enormous treasures, some holding more platinum than has ever been found on Earth. A few adventurous entrepreneurs (including two Google billionaires) have started a company called Planetary Resources to find, refine and then extract these riches. To succeed, they must first overcome but then exploit the cruel economics of rocketry.
To send a ship into outer space you need a lot of fuel — the heavier the rocket, the more propellant you need. But most of a rocket ship’s mass comes from its fuel, so the majority of a rocket’s fuel goes to launching its fuel, leaving little room for other cargo. Additionally, the enormous stress that rockets encounter escaping the Earth’s atmosphere makes it enormously expensive to lift each ounce into space. Planetary Resources would necessarily incur painfully high expenses to put even relatively light mining equipment onto any asteroid, meaning the company will never be able to use the massive mining machines that ably dig out precious metals from terrestrial soil.
Planetary Resources hopes to use solar power to break down the water on asteroids into hydrogen and oxygen, which it could then use to produce fuel. Although this fuel could never be used to launch a rocket into space, it could propel a ship that had already left Earth. Planetary Resources could potentially use this water-based propellant to power its spaced-based mining operations. An easier source of profit would be to sell the water to NASA as a source of propellant, oxygen and (obviously) drinking water.
Planetary Resources’ best path to profitability, consequently, will be if NASA and its foreign counterparts undertake major new space missions. This would probably require a sustained economic recovery in the developed world and an advertising and lobbying campaign to promote interest in space exploration. If you think that Planetary Resources has a decent chance of doing this, beneficiaries could include companies such as Boeing that make equipment for NASA.
If Planetary Resources can cover much of its upfront costs by selling fuels to others, it could then start trying to send minerals back to Earth. Since the earth lies at the bottom of a deep “gravity well,” it’s much cheaper to move something from space to Earth than to do the reverse.
As of this writing, gold and platinum sell for roughly $1,500 an ounce. But these metals are valuable in large part because they are rare, so if large quantities of such resources were brought back to Earth, their prices would plummet. An interesting implication of this is that if microscopic life were detected on Mars or, say, in an underground ocean of a Jovian moon, I would expect the price of gold to immediately fall as investors factor in the increased likelihood of asteroid mining.
Mitigating any fall in price, however, would be the possibility of new uses for asteroid metals. Platinum’s high price undoubtedly limits its industrial use. I’d bet that even now some engineers are imagining what new applications they could put platinum to if asteroid mining were to cut its price. Hope for these new applications would to some extent prop up prices, and expectations of this have likely played into Planetary Resources’ revenue projections.
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