By Kirk Kaczmarek
In 1848, James Wilson Marshall was walking along the American River near Coloma, California when he spied gold in the riverbed.[1] Thus began the California Gold Rush.[2] Within twenty months of Marshall’s discovery, the non-native American population increased by over 12,400%.[3] In 1852, the Gold Rush’s peak year, miner forty-niners extracted an inflation-adjusted $2.623 billion in gold.[4] This exploding and newly wealthy population supported further economic growth, as merchants and other service providers made more money than the miners ever did.[5] As for Marshall, he was unable to secure legal claim to the gold fields, and completely missed any form of windfall.[6]
The next gold rush might happen in outer space as governments and private companies consider mining asteroids for rare earth metals. For example, NASA has placed a rush on plans to investigate an asteroid estimated to contain $10,000 quadrillion in iron and nickel by 2022.[7] Goldman Sachs has indicated that, “while the psychological barrier to mining asteroids is high, the actual financial and technological barriers are far lower,” and that the world’s first trillionaire will be an asteroid miner.[8] Whether humans mine asteroids is fundamentally a matter of economics. And whether investors end up wealthy or following in Marshall’s footsteps will require clarity in a currently unclear area law.
When considering whether to mine at a location on earth, geologists consider resources and reserves.[9] Resources are mineral deposits that geologists identify through exploration.[10] Reserves are the portion of resources that feasibility studies determine are economically viable for mining.[11] Thus, resources and reserves do not estimate how much of a mineral is available on the planet – they are merely labels that help us measure the quantity of minerals available against market demand.[12] Conversely, terminal depletion refers to the actual lack of a mineral.
Today, China produces over 90% of the world’s rare earth metals.[13] Unfortunately, China claims that its reserves for numerous rare earth metals will deplete within twenty years.[14] Terminal depletion is unlikely; geologists would likely discover more resources in the meantime, though issues in the supply chain might occur.[15] But whether these resources would have the economic viability to become reserves is less certain, especially when confronted with the possibility of turning asteroids into mineral reserves. This possibility is quickly growing noticeably closer.
On October 3, 2018, a mission headed by the Japanese Aerospace Exploration Agency successfully landed a robot onto an asteroid, Ryugu, for the first time in history.[16] On December 3, 2018, NASA expects to collect a sample from asteroid Bennu and return it to earth.[17] With the convergence economic and physical capabilities, asteroid mining seems like an inevitable future.
In the United States, private companies like Elon Musk’s SpaceX and Chris Lewicki’s Planetary Resources hope to gain access to the asteroid mining market.[18] The United States government appears to support their entrepreneurialism. In 2015, the U.S. Commercial Space Launch Competitiveness Act passed with bipartisan support. Title IV of this act directs the President to facilitate the private commercialization and recovery of resources found in space.[19] The act also states that miners are entitled to own the resources they mine.[20] Some might argue that this act conflicts with the 1967 Outer Space Treaty, which states that “outer space, including the moon and other celestial bodies, is not subject to national appropriation.”[21]
Can a country mine minerals and remain in compliance with the Outer Space Treaty? Can a country contract a corporation to mine minerals on its behalf? What if two corporations try to mine the same asteroid at the same time? What if these corporations are headquartered in different countries? Who will clean up the debris left orbiting the earth as spacecraft exit the atmosphere and return with valuable payloads? Should we require licenses to mine asteroids? The hypotheticals are as endless as space itself.
The law governing this emerging field is understandably immature. As a leader – if not the leader – in space exploration, United States ought to remember the case of James Marshall, and its own analogous position as the discoverer. Growing pains are likely unavoidable as we reach into a new era of exploration and innovation. However, by giving some forethought to the international law governing asteroid mining, the United States might mitigate the worst of those pains.
[1] See Events in the West 1840-1850, PBS (2001) https://www.pbs.org/weta/thewest/events/1840_1850.htm, James Wilson Marshall, PBS (2001) https://www.pbs.org/weta/thewest/people/i_r/marshall.htm.
[2] See James Wilson Marshall, supra 1.
[3] See Gayle Olson-Raymer, The California Gold Rush and the Controversy of the State Constitution, Humboldt State University (2014) http://users.humboldt.edu/ogayle/hist383/GoldRush.html.
[4] See id. See CPI Inflation Calculator, Inflation Calculator https://www.officialdata.org/1852-dollars-in-2018?amount=80000000.
[5] See Karen Clay & Randall Jones, Migrating to Riches? Evidence from the California Gold Rush, 64 The Journal of Economic History 4, 1021-1022 (2008) https://www-jstor-org.newman.richmond.edu/stable/pdf/40056467.pdf?refreqid=excelsior%3Abe44b6164c135df13a516fed60ed92ca.
[6] See James Wilson Marshall, supra note 1.
[7] See Brid-Aine Parnell, Nasa Will Reach Unique Metal Asteroid Worth $10,000 Quadrillion Four Years Early, Forbes (May 26, 2017, 6:12 am) https://www.forbes.com/sites/bridaineparnell/2017/05/26/nasa-psyche-mission-fast-tracked/#376228844ae8.
[8] See Aaron Mamiit, The World’s First Trillionaire Will be the One Who Harnesses Space Mining, Tech Times (April 23, 2018, 8:37 am EDT) https://www.techtimes.com/articles/225886/20180423/the-worlds-first-trilionnaire-will-be-the-one-who-harnesses-space-mining.htm.
[9] https://www.geologyforinvestors.com/classification-of-mineral-resources-and-reserves/.
[10] See id.
[11] See id.
[12] https://www.mining-technology.com/features/featuremined-into-extinction-is-the-world-running-out-of-critical-minerals-5776166/
[13] See id.
[14] See id.
[15] See id.
[16] See Numerous Boulders, Many Rocks, No Dust: MASCOT’S Zigzag Course Across the Asteroid Ryugu, DLR (October 12, 2018) https://www.dlr.de/dlr/en/desktopdefault.aspx/tabid-10081/151_read-30235/#/gallery/32338.
[17] See The Mission, OSIRIS-REx Mission https://www.asteroidmission.org/objectives/, Mission Operations, OSIRIS-REx https://www.asteroidmission.org/objectives/mission-operations/.
[18] See Staff, Classification of Mineral Resources and Reserves, Geology for Investors https://www.washingtonpost.com/business/space-mining-may-be-only-a-decade-away-really/2017/04/28/df33b31a-29ee-11e7-a616-d7c8a68c1a66_story.html?utm_term=.23a3f5ddd07c.
[19] 51 U.S.C.A. § 51302
https://1.next.westlaw.com/Document/NB31DBAB0A3BB11E5AA6DE6442ADFAF1C/View/FullText.html?originationContext=previousnextsection&contextData=(sc.Category)&transitionType=StatuteNavigator&needToInjectTerms=False.
[20] 51 U.S.C.A. § 51303 https://1.next.westlaw.com/Document/NC516B640A3BB11E59891923A4484C9F7/View/FullText.html?originationContext=previousnextsection&contextData=(sc.Document)&transitionType=StatuteNavigator&needToInjectTerms=False.
[21] G.A. Res. 2222 (XXI) http://www.unoosa.org/oosa/en/ourwork/spacelaw/treaties/outerspacetreaty.html.
Image Source: https://www.flickr.com/photos/cygni_18/41235922900