Asteroid mining?! Can this be profitable?!

Great Debates
41

No one’s mentioned the fact that, if you have the energy and delta-V to go asteroid hunting, then you also have the capability to turn those asteroids into WMDs. No government is going to lightly cede control of that capability to a private company.

As it is, I have a very difficult time imagining that launch costs will get low enough in the foreseeable future to make this endeavor profitable. While I’m writing this, I feel a bit like King Henry of Portugal giving Columbus the brush-off, but still. Even if SpaceX, etc, drop the price/kg. to LEO by a factor of 10 or 20, I can’t see it being practical. The answer, IMHO, as to the asteroids they’d be looking for would be those containing various rare earths. Maybe Helium-3?

I would love to see the capability of asteroid mining become practical though. Because if you have the capability to asteroid mine, you have the capability to: watch for and deflect earth-crossing meteoroids/asteroids, build solar power satellites, build very large astronomical equipment, build microgravity/vacuum manufacturing. All of these could elevate human global productivity.

42

Oh, c’mon, we already know how to handle that! Just blow the thing up with nukes! And ignore the fact that you now have millions of radioactive fragments with the same total kinetic energy as the original asteroid moving on the same trajectory towards Earth!

43

I’m not worrying about that, I’m simply pointing out (along with others) that secondary market effects will have a big undercutting effect on the potential profits.

44

Take a look at how much gold there actually is in the world. It’s surprisingly little.

A decent-sized gold asteroid could easily double the supply, and THAT would have a significant impact on its price.

(I’;m not saying it’s likely that we’d find a space body of pure gold – but that’s what was in the Scrooge and Verne stories.)

45

Flashing on Cowboys and Aliens:

COWBOY: What did they come here for?!

HOT CHICK ALIEN: Gold!

COWBOY: Gold?!

HCA: It’s as valuable to them as it is to you!
Really? Would it be, for any spacefaring civilization? Valuable enough to warrant robbing gold prospectors in another star system – gold prospectors who do not even have access to their own system’s asteroids?

OK, I know, it’s dumb to nitpick something titled Cowboys and Aliens . . .

46

But I intend to hold Gladiators vs. Werewolves to a higher standard of common sense and scientific accuracy.

47

Only if it happens quickly and in large quantities and done quite cheaply. For that to happen you would need a real breakthrough in space technology. A literal game changer. Some technology that probably doesnt even exist today except in someone’s dreams. That may happen or it may never happen.

IMO what is likely to happen is access to space will slowly but surely (with significant effort) get gradually cheaper through refining the art.

So, at some point space gold will be (maybe) on par cost wise with earth gold. And its still gonna cost a fortune in capital investment to go get. And it will still likely be risky with hits and misses.

So, all I see is possibly gold reaches a peak price, then levels off and perhaps slowly drops in price as gold production shifts from the earth surface to space. And the price isnt going to drop any faster than the space mining technoloy improves because they are not going to mine enough to reduce the supply so much that they loose money.

48

Oh, and another thing. I think the first company to finally get space gold (or whatever precious thing) cheaper than Earth gold will likely become the DeBeers of gold. Because once they get a slight edge most Earth production would shut down and anybody else that tried to mine in space could be undercut and run outa business before they got their investment back. THAT might be why a few billionares are interested in this. If they win, they may corner the market (that is until the UN communists come in and demand “shares” for everybody else on the planet).

49

Don’t confuse price with value, or the state of current platinum markets with ‘the economy’.

Platinum is widely used in manufacturing, medical devices, electronics, and in end-user applications. The catalytic converter in your car uses platinum. Hydrogen fuel cells are held back in part because of the high price of the platinum they need. All of these things would be cheaper if the price of platinum fell. Or looked at from a more fundamental basis, having a larger supply of a key material will allow us to meet the needs of more people.

The real economy is not the same as the financial economy. Ultimately, what makes us rich has nothing to do with the prices of everything - it has to do with our capacity to make things people want and need. Access to large quantities of a precious metal that has major industrial applications may distort the market for that particular metal, but it would be a boon to all of us.

50

I can buy the idea that water ice on asteroids would be a valuable commodity if you could get it to a space station without too many problems. But I’m not seeing that working out with metals of various sorts.

In order for them to be usable in space without bringing them up from Earth, you’d need to refine them from ore in space, which means we’d have to lift the pieces of a refinery from Earth into space. I expect that it would be cheaper just to continue to boost the metals themselves out of Earth gravity.

51

i.e. only if the initial mining company makes a killing, right?

I doubt it. There are thousands of asteroids out there and no easy way for a private company to prevent people from mining them.

52

About the venture in general:

First of all, this can be looked at as philanthropy. Bill and Melinda Gates use their billions to help the poor in Africa, and these guys are using theirs to help humanity move into space. That’s all the justification they really need.

However, there is an actual business model behind this. While asteroid mining is the long-term end goal, these guys are being really smart about the way they are doing it. Recognizing they need the ability to inspect thousands of small objects in space, they’re starting with small, orbital space telescopes. But these telescopes serve multiple functions: They can be turned on earth for use in remote sensing. They can be re-tasked as general space observation scopes. They can be used for observing orbital events or for detecting dangerous earth orbit-crossing asteroids. These scopes can be rented out to scientific organizations, educational markets, etc. Telescope time is valuable - scope time on a telescope in orbit would be even more valuable. So they’ll have a ready market as soon as they launch their first round of vehicles.

Will that be enough to pay back all the development? Probably not. But as a secondary source of funding for further development to help bootstrap the next phase, it’s great.

Along the way, they will be developing new technologies that will be available to sell to other groups or to use themselves. For example, NASA was supposed to fly an array of small telescopes to prove out the technology for coordinating arrays of scopes into large interferometry arrays that will allow us to see much further into space with greater detail. But that program was killed. These guys might be able to build up that technology and refine it with their program - and then either provide the interferometry arrays themselves or contract out their ability to someone willing to pay.

53

There are refining methods that can work in space that can’t be used on Earth. For example, how do you mine an asteroid for gold? On option is to spin it in a magnetic field, letting eddy currents heat the asteroid until the whole thing melts.

Centripetal acceleration then separates all the material by density. Blow off the slag, and there you go.

Or maybe you put an ion drive on it to slowly nudge it into an elliptical orbit that will take it near the sun. Then you pulse the ion drive so that it starts the thing rotating. It goes past the sun and melts and separates, then you grab it when it comes back and you have a refined asteroid.

I’m sure there will be many other techniques developed as these asteroids are explored and their structure is figured out. Maybe we’ll use high-power lasers to ablate the surface, then catch the flung material and sort it. Who knows?

54

nevermind.

55

But you’re confusing the cost of production with the value.

Yes, it would cost umpty-ump billions of dollars to go out into space and find solid gold asteroids and bring them back to Earth. That means the cost of production will be very high no matter what the price of gold is. But if you bring back a solid gold asteroid and try to sell all of it, what happens? The spot price of gold plummets. Yes, we can absorb all that gold and it’s not like the gold is intrinically worthless and a supply of cheap gold means we can do all sorts of useful things with gold that we can’t do now.

But if the cost of space gold is high, and selling space gold drops the price, the first asteroid returned makes the price so low that it wouldn’t make sense to go and get another one, and it might drop the price so low that even the first mission won’t be able to pay for itself.

What I mean is, suppose current price of gold is $1000 an ounce, and it will cost $10,000,000,000 to bring back an asteroid, and the asteroid contains ten million ounces of gold. Well, it cost 10 billion, you sell the ten million ounces, and you get 10 billion, and the expedition breaks even. Except that won’t happen.

It doesn’t matter that it cost you 10 billion for the whole expedition, you still have to sell the stuff on the open market. The buyers don’t care that the gold was expensive to get, the price is a function of supply and demand, and you’ve massively increased supply without affecting demand. So you can’t sell your stock at $1000 an ounce. In fact, the mere likelihood that asteroid gold-mining would turn out to be feasible is going to drop gold prices before the first expedition ever sets out, because the market will anticipate the future increased supply and discount it in advance.

In other words, simply doing a credible public business case that gold mining in the asteroid belt would be economically feasible might be enough to make it infeasible, because if you actually could do it you’d drop the price enough to make it not worth doing.

56

But you are assuming that once space gold can be gotten at, you can bring in enough to drastically alter the market. Yeah, you can in the sense that there’s a shitload out there to be had. But you can’t because the capital investment is going to be astronomical. And nobody is going to invest enough capital to mine enough to drive the price so far down that they loose money.

57

The cost of putting/retrieving anything to/from orbit is so prohibitively high, it will be a long, long time until such a venture is profitable. If some new lift technology, such as the space elevator, can be developed, then there exists exceptional opportunities in space.

58

First of all, it makes very little difference how far you go. Energetically speaking, low Earth orbit is halfway to anywhere. It takes almost as much energy to reach, say, the Moon, as it does to reach the asteroid belts in orbit around Sirius (though of course, the ones around Sirius would take a lot more time).

Second, asteroid mining isn’t profitable now. But it will be eventually. And it just might be worth it for a company to start working on it now so that they’re in on the ground floor for when it does become profitable. Especially if, as Sam Stone points out, they can bring in supplemental revenue streams along the way.

59

“Cede”? If only a private company is doing this at all, on what grounds is the DoD going to interfere?

60

Why? What pieces are in a refinery, that can’t be made in space? Some manufacturing equipment would have to be boosed from surface to orbit, but not the whole factory, ISTM.