Universe Today broke the news that NASA (The US space agency) is planning to capture a 500 ton asteroid. That sounds big, but it’s only about 7 meters wide. The article came with an artist’s illustration of what this would look like.
This would be a moderately interesting story, but unrelated to finance, right? Not so fast, dear reader. Universe Today also had a Q&A; What Are Asteroids Made Of? It turns out that “the metallic asteroids are composed of up to 80% iron and 20% a mixture of nickel, iridium, palladium, platinum, gold, and other precious metals..”
20% precious metals? If this asteroid is of the metallic type, we are looking at 100 tons of precious metal. If half is nickel, not so precious, we still have 50 tons, or 100,000 pounds of treasure. At $1,000 (It’s still a variety of metals, so I’m estimating the average) per ounce this multiplies to $1.6B from a projected cost of $100M to fund this venture. I wonder how long it will take before commercial ventures attempt asteroid mining.
It may be that the composition suggested in the article is wrong, and even the metallic asteroids are lower in the truly precious metal compared to iron, copper and nickel. That would be a shame. It’s still years away, but it’s interesting to ponder the idea that we have the technology to begin a space mining operation.
Is this too great a logical leap? Is this idea still science fiction? If it’s all possible, and the numbers work out as I suggest, what would be the impact of the price of these metals? There is currently estimated to be under 4 billion ounces of mined gold on the planet, would a few hundred thousand ounces at a time be absorbed, or would it send the price crashing down?
Very exciting news. Space mining has been so enticing but incredible cost-ineffective. Perhaps this will spur research on technologies that make it a viable option.