The gold of the Moon 
A fantastic speculation by Giulio Gelibter, some "rough figures ", and some literary notes proposed by the Sc. Dir. of TDF, Dr. Marco C. Bernasconi 

The "stone of the scandal" 
Various arguments were exchanged, in the space of TdF, between the end of the 2000 and the first months of this year. Giulio Gelibter, intrigued by some TdF forum posts, started reasoning (or dreaming) about the eventuality that some precious metals were discovered in the Solar System...   

The fact is that if the existence of gold on other planets were proved then there would be enormous economical repercussions. The gold price is fixed on the basis of supply and demand, and also taking account of the existing worldwide reserves. If conspicuous gold reefs were found, even if not in the immediate future, and not on Saturn, but on the Moon, an interesting dilemma would be placed. If the metal were economically exploitable within, let say, 10-20 years, the gold price could "psychologically" collapse to 130-180 USD / ounce (vs. approximately the current 270). Such prices would probably make the exploitation impossible for years. This last condition, paradoxically, could raise the price of the metal, taking it up to approximately 300 USD. All the experts currently agree that the gold price should be around 300-400 USD; instead it is held low by the speculative trading of financial institutions (that want to profit from low interest on 'bullion loans'): this means, naturally, that the demand is higher than the officially estimated one, or that the producers do not extract all the gold they could. 

If some theoretically minable gold were discovered on the Moon, at lower costs (the mining costs have always had a big influence on the prices), it may be profitable, taking into account that, after several years, the mining costs would be drastically reduced. There is of course a difference between gold, used as a monetary safe haven and reserve, and that used in the precious metal industry. But it is also clear that a metal whose price becomes very low could be used by industry, raising the demand again, but losing part of its value as a monetary safe haven (based on its relative rarity and indestructibility). The problem, with gold, is that no sure objective references exist except demand and supply. Before Nixon it was just a little over 30 USD / ounce.

Gold is a mystical metal, for the alchemists all the metals in the mine, if left in peace, endup sooner or later as gold. In the laboratory this process was simply accelerated. The gold therefore is not only venerated for its rarity and indestructibility, but most of all for its molecular perfection, which represents the pinnacle of evolution of the Mineral Kingdom, and also an important concrete metaphysical reference. A Kingdom, the mineral one, let's not forget, is under the power of the Elfs and Gnomes that, according to the legend, would have left for other planets, finding Earth much too crowded with boring humans...  

But the extra-terrestrial gold mine would be an enterprise in deficit 

Already blamed by our Scientific Director, we come back to our feet on Earth... Let's see a realistic business-plan, of a hypothetical extra-terrestrial mining enterprise...  

An (optimistic) business plan of an extra-terrestrial auriferous mine, at the current costs: 
  • Price of 1 gram of gold: approximately 10 USD. 
  • Cost of the launch to LEO: USD 20,000 /kg.  
  • Cost of mining at the lunar surface: USD100,000 /kg (optimistically).  
  • Typical space hardware cost: USD 100,000/kg. 
  • Costs of a vehicle, 1t mass, able to land and to take off from Earth and Moon with its motors and propellants, and to bring back to Earth an equal payload to its dry mass: 
    • Cost of the vehicle: 100 MUSD. 
    • Cost of the launch: 100 MUSD (optimistically low, by a factor of 2-4). 
    • Value of cargo: 1,000,000 g AU, per 10USD/g: 10 MUSD. 
    • Deficit: 190 MUSD. 

The sum still does not include the cost of the plant to get gold and propellant...   

The same hypothesis, allowing for possible technological advances is given below: 

  • Specific cost of the vehicle: 10.000 USD/kg.  
  • Transport costs: 10.000 USD/kg. 
  • In order to obtain 10 MUSD in gold we will "only" spend 20 MUSD (plus the development costs and of the plants costs).

As we can see from the following hypotheses, the extra-terrestrial auriferous enterprise is not encouraging. Platinum or diamonds would be more promising candidates (also because gold sold today does not come from current production), but still are not profitable at the current costs. Obviously, things change if we introduce the tax variable into the equation: to spend 400 million USD and earn 10 could be interesting for an X billionaire, aiming to save on taxes. Let's suppose that a law made the import/export from geolunar space, tax-exempt. For five years the enterprise writes 100 MUSD of red figures (saving a 300 MUSD in taxes): at the end Mr. X owns one ton of gold, exempt from tax! 

Moreover, Bernasconi continues, the market for precious metals is based, however, on rarity more than on consumption, and the gold market, is also affected by price manipulation. The difference between gold as shelter and as industrial metal, therefore, is not so relevant. Gold already today is abundantly used for industrial purposes, and retains value for its chemical characteristics, lets say, superficial: beauty and indestructibility. Its rarity remains however "guaranteed" by physics: a crash comparable to the one of aluminum is not thinkable, (an extremely disseminated element, but difficult to mine and therefore "culturally rare") in a given historical period. The industrial use of gold would increase along with the real availability of the metal and also with quantitative technical advantages brought to the products (advantages that would be reflected in the price). 

On the other hand micro-technologies allow a "centered" use where gold supplies the intentional property, and therefore the impact of gold on the price of the product is very circumscribed. Also, 10 billion human beings continue to wish to own small pieces of gold for their pleasure and for the intrinsic value of the metal! As to the variations of the gold price, people speak of a chronic lack of 4000t Au on the market. The insiders keep the gold price artificially low, "recycling" the above-mentioned loans in order to keep their friends from becoming bankrupt (since they borrow gold that nobody can exhibit). In such dealings they are helped by the central banks that, stupidly, sell part of their reserves, not only that, but they even announce the sale! It is not gold that has "acquired" a higher value, but rather the dollar -- or more correctly the FRN (Federal Reserve Notes ndr) -- that have lost the greater part of its value. The gold bugs love to mention an example (in order to demonstrate the steadiness of the value of gold) that x ounces today still buys a handmade dress, just like a hundred years ago. The following diagram (from a relationship of Frederick Mann) offers a quantitative analysis.


The true Space Gold is the Solar Power 

Finally Bernasconi gives us some historical-literary notes of... great value, and the key for the true gold race of the 21° century! 

Science-fiction literature does not lack interesting cues in this matter. In "The Man Who Sold the Moon" - Delos Harriman manages to carry diamonds on the Moon, hiding them, and asserting then that they are of local origin, the object of a scientific experiment, etc... nobody believes him, and his actions continue.  

In reality, the problem of high specific value ($/kg) products has been dealt with, in particular, by Gordon Woodcock at the beginning of '70: if the transport and production costs remain around the current levels, the integral of the interest segment is too small in order to change something. Not for nothing, Woodcock proposed a morphologic approach to space products, and, due to that, energy (mass ~ 0) appears the preferential introductory product! Think about the LPS (Lunar Power System) of David Criswell: the plants on the lunar surface produce "only" Photo-Voltaic cells and antennas for microwave transmission, using very common elements (silicon, aluminum...). The export towards Earth consists of microwaves... The "microwave fuel" ("mw fuel", as Patrick Collins has called it) does not appear in industrial distribution, but it has an essentially infinite specific value and a great market potential.  

"The old country had inhabitants that men have dreamed and sung and written and told about a great deal, and seen more than seldom... there was ghosts and pixies, goblins and brownies, and dervishes and fairies and nymphs and peris and dryads and naiads and kilpies and sprites; gnomes and imps and elves and dwarves and nixies and ghouls and pigwidgeons, and the legion of the leprechauns, and many another. And loads too were good and loads too were not, and loads helped and loads hindered; but all too were mischievous as hell." T. Sturgeon (1947), Cargo... in which the little folk emigrate to America to escape WWII.

The precious metals can constitute a useful addition for the economy of a Lunar Colony. The development of techniques to reduce operating costs must be based on broad markets, since high value niches are insufficient.

[GG-MCB TDF 2/2001 - 01/04/2001]

[The English version was revised by Ben Croxford]