The recent space race in the private sector created some outlandish hype around space mining. In 2017, analysts valued the space mining market at half a billion though nobody had conducted mining activity in space. The imaginary half a billion market was expected reach $2.84 billion by 2025. Some countries have begun efforts to realize economic opportunities in space and to gain a competitive advantage by being the first in the market. Luxembourg and the United States promulgated laws to support space-mining activities. Luxembourg created a fund to entice space-mining initiatives.

Leading investment houses Goldman Sachs and Morgan Stanley published lengthy financial analyses for their clients. Goldman Sachs predicted that space mining would be a trillion dollar industry. Planetary Resources and Deep Space Industries managed to convince some well-known Silicon Valley investors to invest in their asteroid-mining projects. Alphabet Inc.’s Larry Page and Eric Schmidt, and Hollywood filmmaker James Cameron all invested in Planetary Resources, Inc.

Then the market changed and the space-mining bubble burst suddenly. Professionals realized that space mining would not work in the way people thought it would. As the old Wall Street saying teaches You just need to take a position against the big investment houses’ recommendations, and you can’t lose. It worked like a charm once again. It saved money for all who did not fall for the analyses of Goldman Sachs and Morgan Stanley. 

Venture capitalists realized that space mining, as they had imagined it would happen, would take a lot longer than a venture capital fund’s regular life cycle. Since there are many other space companies that promised high returns in a shorter period of time, they turned away from space mining. 

After the rise and fall of the nonexistent space mining industry, we need to get back to reality, and look at the market objectively. Space mining is a real possibility, and it will happen sooner than most people would think. However, the market and realities of the enterprise must be studied and understood to discover how to make it work. Now is a good time for a space market, this time a real one, to be born. If you can get the market right, you can make a working business model that would be suitable to rebuild investors’ trust and entice investment for business development.


Early market reviews described fabulous treasures hidden inside asteroids and other planetary bodies that were simply waiting for humans to collect them and become the wealthiest people in the universe. According to one market review, a football-field-sized asteroid could contain more than 1,500 metric tons of platinum. Space mining is a trillion-dollars industry, reported another. Nothing came of those projections because analysts ignored basic market and economic principle.

Laws of Supply and Demand

Market reviews erroneously relied on sustained high precious metal prices. However, we should expect the opposite. Asteroid mining would create an abundance of supply that could cause the commodity markets to collapse. 

The law of supply and demand explains the interaction between the sellers of a resource and the buyers for that same resource. Generally, this theory suggests that the higher the price, the lower the demand. Hence, if sellers want to sell more products, they need to lower the price. Therefore, if the supply of a resource increases and exceeds the demand, the price would inevitably fall.

A football-field-sized asteroid can contain more than 1,500 metric tons of platinum. By comparison 190 metric tons of platinum is mined worldwide each year. That means that one small size asteroid could provide platinum for twenty years. The news that announced the arrival of an asteroid full of platinum to an Earth orbit could cause not only a sudden price drop, but also it would result in serious market dislocation and reshape the entire market. For example, the decrease of oil consumption caused by COVID in April 2020 was sufficient to cause a temporary dramatic drop in the price of oil. On the expiration day of the oil future contract, the oil price even fell below zero. Asteroid mining could have a much more serious adverse impact on the commodity markets, and that impact, as opposed to COVID, would be permanent. The precious metal price would be at a lot lower level than it is today.

The astronomical costs of space mining would require high prices sustained for decades to produce return on investment. Oversupply of the precious metal market would have an adverse effect on the commodity price. Therefore, it makes no sense to mine precious metals in space with the purpose of selling them on Earth.

Asteroid Mining Cannot Compete with Earth Mining

While you can develop a mine on Earth within five years with less than $1 billion investment, asteroid mining requires $2.6 billion to be tied up for decades. Furthermore, the operating cost of asteroid mining would be higher than Earth mining.

This raises a simple question: why would a company bring more expensive platinum to an already over supplied market? No, it should not. When the precious metal supply drops below a certain critical supply because of the decline of Earth resources a company may consider looking for new resources in space. Until then, precious metal mining in space will not be able to compete with Earth mining.

Platinum, Even a Football-Field Amount, Will Not Make You Rich

Platinum has been the most frequently mentioned precious metal to be mined in space. In 2020, the all-in sustaining cost of platinum exceeded $1,100 per ounce while the market price was less than $1,100 per ounce. That meant that the platinum mining on Earth was not profitable. The reason for the relatively low price was over supply caused by the continuously declining demand. The industry no longer needs as much platinum as is produced.

Historical platinum prices

Other precious metal markets are not as tough as the platinum market. For example, the all-in sustaining cost of gold is around $700-$1,000 per ounce. Although the current market price is much higher than the all-in sustaining cost, a significant increase in supply could push gold off the cliff as well. Not to mention that space mining will not produce gold for $700-$1000 per ounce it is very doubtful that gold mining in space would be profitable at the current gold market price.

Thus, the platinum-mining sector is struggling, and the way to solve this problem is to not bring more platinum from space; instead, some existing mining operations should probably be suspended or closed down to adjust supply to current needs. While other precious metal markets are healthy, mining those materials in space would not be profitable.

In conclusion, the precious-metal mining in space is not supported by basic economic principles and current market conditions. Does that mean that space mining will remain the dream of some science geeks? Far from it. Space mining is still a viable business. However, you need to understand the market, find the right material, and develop a feasible business model.


Space mining is a type of mining activity that can be considered a next phase of the mining industry evolution. Mining is defined as the industry and activities connected with getting valuable or useful minerals from the ground. Others define mining as the extraction (removal) of minerals and metals from below the ground, with the permission of the country’s government.

Historically, the initial exploitation of a deposit involved rudimentary scratching of the surface and picking up pieces of ore from the surface. This surface method was followed by the development of underground mining methods in shafts and galleries. However, the industry never abandoned surface-mining method. Even today surface mining takes a very significant share of the industry. Accordingly, we can divide mining into four big categories: underground, surface mining, placer, and in situ mining. Among those, underground and surface mining are relevant for space mining.

What is Underground Mining?

Underground mines are used to reach deeper deposits in the bowels of Earth. Underground mining is something that most people usually visualize when talking about the activity of mining. It involves blasting, digging, and excavating deep down in the mine to reach the deposits. This is the most expensive and technologically most challenging method of mining. 

What is Surface Mining?

Surface mining is typically used to reach shallow deposits. Surface mining is simpler and cheaper than other types of mining, and that makes it the preferred technique even today. Surface mining may be open-pit mining, strip mining, or quarrying.

Open-pit mining is a surface-mining technique that extracts minerals from an open pit in the ground. Practically, this method works well when the mineral is close to the surface. Basically, you dig a big pit to unearth the mineral. It does not require building shafts and tunnels. After the physical mine infrastructure has been built, production activities include drilling, blasting, excavation, loading, and transporting ore. Strip mining is the practice of mining a seam of mineral by first removing a long strip of overlying soil and rock to reach the mineral. Quarrying is the process of removing rock, sand, gravel, or other minerals from the ground in order to use them to produce materials for construction or other uses.

Mining in Space is a Segment of the Mining Industry

Most market reviews define space mining as the type of excavation of materials and minerals from asteroids and near-Earth objects. However, the activity of extracting minerals is sometimes very different from blasting open a shaft, grabbing a pick and lanterns, and marching down into the bowels of the Earth to bring up valuable minerals. Sometimes mining means only removal of a surface layer. This distinction is imperative when defining mining activity and space mining. Therefore, the “type of process of excavation of materials and minerals” used in the definition of space mining should be replaced by “removal of materials and minerals” from asteroids or the ground of other planets or planetary objects.

Space Industries Lunar Resource Extraction Vehicle (LREV) concept

The method of extraction depends on the mineral to be acquired and the location of the deposit. A space-mining project may target precious metals, Helium-3, or water. Each of these requires different mining techniques. The applicable mining techniques have a serious impact on development cost, technical challenges, time of development, profitability, and feasibility. Therefore, the way you mine will determine of what will be mined in the near future.

Mining precious metals is a no-go for now

Precious metals like gold and platinum can be found in asteroids and possibly on the Moon. In case of asteroid mining, the process is extremely complex and technologically challenging. You need to find the right asteroid, you need to build a spacecraft, capture the asteroid, and develop some sort of process to extract the mineral in an extreme environment. The development costs are high, and the time needed to develop them could be measured in decades. Because of the market conditions, it is very doubtful that asteroid mining for precious metals would be a profitable endeavor in the near future.

Precious metal mining on the Moon would possibly require either underground or pit-mining techniques. Either way, the mining would require extensive excavation and complex fully-automated extraction, refining, and transport processes. Even though Earth mining went through a huge technological change by deploying drones, automated equipment, 3D modeling and AI that could be used in space, the precious-metal extraction would still need many years of research and development, and hundreds of million of dollars long-term investment. Perhaps, this could be considered when a permanent presence has been established in space, and manufacturing and building infrastructure have created in space demand for precious metals. Locally mined raw materials would be more competitive than materials shipped from Earth. Until then, we should not focus on precious metals.

Mining Helium-3 and Water on the Moon is where the money is

Unlike Earth, which is protected by its magnetic field, the Moon has been bombarded with large quantities of Helium-3 by the solar winds. Therefore, Helium-3 is a rare isotope on Earth, but it is abundant on the Moon. Helium-3, other than clean energy production, is used to manufacture advanced imaging technology in the medical and security industry. Because of its scarcity, Helium-3 is considered a strategically important material.

From space mining perspective, there are two significant difference between helium-3 and precious metals: Unlike precious metals, Helium-3 is very limited on Earth, and unlike precious metals, Helium-3 is accumulated in the surface regolith of the Moon, so complex underground mining process is not required to obtain it.

Helium-3 mining resembles strip mining or quarrying where only the surface layer is removed to extract the valuable material from the regolith. There is no need to dig a gigantic pit, blast, or remove large amounts soil to reach Helium-3. Practically, a lunar resource extracting vehicle, or LREV, could travel around the surface collecting regolith. Then, it would extract the Helium-3 and discard the unnecessary materials.

LREV lunar mining process (simplified)

The process is technically complex and challenging, but we could rely on existing technology. Scientists have sent rovers to Mars and the Moon. The rovers have traveled on the surface collecting and analyzing samples. LREV would do the same, but rather than making various tests on the regolith the LREV would extract Helium-3 from it. This is very likely to become reality in five years.

With regard to water the situation is similar. Water is strategically important for deep-space exploration and long-term human presence in space. Water is used to sustain astronauts and to produce propellant. Exploitation of local resources would be a lot cheaper than shipping water from Earth. However, water extraction could be a riskier endeavor than mining Helium-3. Recent research results suggested that the regolith might contain water. However, the form and concentration of it is still uncertain. Therefore, water extraction from regolith may not be sustainable. In that case we would need to dig deeper or venture to a more inconvenient location to find sufficient amounts of water. If this were so, the extraction method would require more complex and technologically more challenging processes. That would mean that the initial investment requirement would be larger and the return on investment would take longer.

Space water market

Asteroid mining and Mars activities are further away. The current market is not ripe for detailed market review. However, space miners must keep an eye on these segments because once the market becomes ready for asteroid or Mars mining those companies who are on the Helium-3 or water mining business may be able to take advantage of their experience, technology and resource to expand to a new market.

In conclusion, the precious-metal mining would not be feasible in the near future because of the market conditions and the complexity of the process. We can consider precious metal mining when we can sell it in space for building and manufacturing purposes. Helium-3 and water, on the other hand, would be good targets and money-generating ventures in five years.


We can assess the Helium-3 market size based on the potential use of the material. Helium-3 is valuable for energy generation, and medical- and security-imaging device production. The global medical-imaging market size was valued at USD 20.13 billion in 2017 and is expected to expand at a CAGR of 4.0 percent. The global security screening market was valued at USD 6.96 billion in 2019, and it is expected to reach a value of USD 9.14 billion by 2025.

Currently, the global helium-3 supply is 10,000-20,000 liter per year and these industries demand 65,000 liter per year according to Northwest and Oak Ridge National Laboratories. In the following years, the demand expected to exceed 108,000 liter per year. Based on the current $3500 per liter market price, the Helium-3 market is $2.4 billion. Currently, these industries are trying to substitute Helium-3, because scarcity of the material. However, if they get steady supply they will be more willing to invest in technology development that requires Helium-3 that would lead to an exponential growth in demand.

Global helium-3 market

In addition, Helium-3 promises clean energy since it is a good fuel for fusion. There are many ongoing fusion energy related research projects that are probably held back by the scarcity of Helium-3. However, a steady helium-3 supply might accelerate fusion energy research creating additional demand for Helium-3.

Therefore, the Helium-3 market can experience an exponential growth between 2025-2030 once we can solve the supply problem.

Turning to water, the most significant water user in space is the International Space Station (ISS). Annual water use exceeds 1,000 gallons. Even if the ISS’s advance recycling system can provide 90 percent of the water demand on site, the rest must be shipped from Earth at a rate of $10,000 per pound. It would be cheaper to ship water from the Moon. When astronauts return to the Moon each astronaut would need a few gallons of water every day. In addition to personal needs, water also would be required for scientific and other purposes. NASA is planning to return to the Moon in 2024, and it is planning a more permanent presence, creating a steadily increasing demand for water.

Additionally, water can also be used for propellant. The increasing number of spacecraft will further increase water demand in space. Hence, water demand will also grow exponentially in space between 2025-2030.

In conclusion, space mining is not a new standalone industry. Rather, it is a new segment of the existing mining industry. Looking at space mining from this angle, we can get a more accurate picture on the sector, which is important for market, business, and legal development.

The traditional mining techniques provide us with clues about the complexity, cost, and return on investment of any particular resource and allows us to determine the feasibility of business. Furthermore, the current market trends of various commodities guide us to identify the best material to mine. Based on the current trends and market outlook, precious-metal mining would be a poor business decision and platinum mining in space would be the business of a fool. Circumstances may change, but the current market reality does not support precious-metal mining in space. Helium-3 and water, on the other hand, offer promising opportunity, because of the expected increase in demand and low current supply.

Author: Gabor Szecsi
Space Tech Legal
Gabor Szecsi (Berkeley, California) is an attorney licensed in the State of California, counseling space startups on transactions, export controls compliance, and privacy law compliance.