Lunar Oxygen Could Be Worth Nearly $300,000 Per Kilogram for Moon Base Crews

A kilogram of oxygen delivered to the lunar surface for the first crews living at NASA’s planned Moon Base could carry a value approaching $286,000, according to a new lifecycle cost analysis that reframes how scientists and economists think about the earliest markets for resources harvested from the Moon itself. The study, conducted by researchers at the Colorado School of Mines, argues that the first paying customers for lunar in-situ resource utilization, or ISRU, will not be rocket fuel depots serving deep-space transportation but rather the small, isolated habitats where astronauts will breathe, drink, and work on the lunar surface. In those habitats, the analysis finds, locally produced oxygen and water could be worth several orders of magnitude more per kilogram than the propellant-focused valuations that have dominated ISRU business cases to date.

The research team, led by James E. Johnson together with George F. Sowers and Angel Abbud-Madrid, built its assessment around two of the most mature habitation elements planned for NASA’s Moon Base: the Japan Aerospace Exploration Agency’s Pressurized Rover and the Italian Space Agency’s Multi-Purpose Habitation module. Both concepts have advanced into preliminary design, making them credible candidates for the earliest human outposts on the surface. Because these elements face strict limits on mass, power, thermal control, and internal volume, they are expected to fly with open-loop, non-regenerative life support systems rather than the water-recycling and oxygen-recovery hardware used on the International Space Station. That design choice means every breath and every liter of hygiene water must be shipped from Earth, at least until local production comes online.

To quantify what that dependence costs, the researchers modeled consumable demand across minimum, baseline, and maximum mission architectures, varying crew size from two to four, mission duration, and the frequency of extravehicular activities. Demand drivers included metabolic oxygen consumption, drinking and food preparation water, hygiene and flush water, cabin leakage, and, critically, the gas lost every time an airlock is cycled for a spacewalk. Using the ideal gas law and Dalton’s law for a two-gas atmosphere, the team calculated the mass of oxygen and nitrogen expelled during each repressurization event, a contribution that earlier studies had overlooked. The result was a baseline oxygen demand 175 percent higher than prior estimates that counted only metabolic use, while baseline water demand came in 45 percent lower than earlier work because it excluded crew showers, a capability abandoned in human spaceflight since the Skylab era.

The analysis then confronted a problem that dominates the economics of shipping anything to the Moon: containment and packaging. Drawing on International Space Station logistics, the study accounted for high-pressure gas tanks for oxygen, contingency water carriers for water, and the soft-sided, foam-lined cargo transfer bags in which both are packed for transit. These containers add enormous overhead. For oxygen, tanks and packaging inflate delivered mass by roughly 229 percent above the raw consumable demand, compared with about 21 percent for water. Because carriers are assumed to be filled to capacity regardless of exact demand, excess consumables ride along as operational reserves, further increasing the mass that must be launched, landed, and handled on the surface. This packaging penalty, the authors emphasize, is the primary reason Earth-based resupply is so inefficient for early habitation.

With demand and delivered mass established, the team estimated lifecycle costs using three independent parametric approaches: NASA’s Advanced Missions Cost Model, a regression-based tool built from more than 260 historical spaceflight projects; NASA’s Project Cost Estimating Capability, which applies cost-estimating relationships within a system-level work breakdown structure; and a simplified industry-based method using heuristic cost factors of $63,000 per kilogram for development and $25,200 per kilogram for flight unit production, adjusted to fiscal year 2026 dollars and coupled with a 90 percent learning curve. Delivery costs were fixed at $100,000 per kilogram, a figure consistent with SpaceX’s most recent projection for lunar surface delivery and far below the roughly $1 million per kilogram implied by current Commercial Lunar Payload Services contracts. Operations costs were applied as a wrap factor of 5.5 percent of development and production costs per year, a deliberately conservative lower bound drawn from published ranges.

Normalizing the median lifecycle cost by delivered consumable mass produced the study’s headline numbers: approximately $286,000 per kilogram for oxygen, roughly $121,000 per kilogram for water, and about $185,000 per kilogram for a combined oxygen-and-water resupply architecture. Oxygen’s premium, more than twice that of water despite lower demand by mass, reflects the brutal efficiency of its packaging, since high-pressure tanks weigh far more relative to the gas they carry than water bags do. The authors note that these figures represent the maximum price a government habitation customer might rationally pay for lunar-derived consumables before preferring Earth resupply, and they caution that the estimates may even be conservative because supporting infrastructure such as pressurized transport systems was not included.

Against these values, the researchers compared three pilot-scale ISRU concepts: a water ice plant that electrolyzes extracted ice, a carbothermal reduction system that processes regolith, and a molten salt electrolysis system that extracts oxygen directly from regolith. Each was sized for roughly 1,000 kilograms of oxygen production per year, with subsystem-level adjustments for habitation service, such as removing liquefaction hardware, adding high-pressure compression for spacesuit recharge, and including a water processor assembly when potable water must be delivered. The comparison revealed a clear economy-of-scale effect: in all but the highest demand scenarios, Earth resupply remains cheaper, but as mission cadence and crew size grow, ISRU production costs fall per kilogram and become competitive, particularly for oxygen. A single water ice or carbothermal pilot plant can meet per-mission oxygen and water demand in nearly all modeled cases, and a 50 percent reduction in assumed recurring spares mass would improve ISRU competitiveness by up to $65 million in lifecycle cost.

The strategic implications extend well beyond a single contract. Previous propulsion-focused ISRU business cases assumed lunar oxygen could command only $500 to $35,000 per kilogram when sold as oxidizer to vehicles operating in cislunar space. A habitation customer standing on the lunar surface, by contrast, is expected to pay an order of magnitude or more than those figures because of the crushing logistical penalties of Earth resupply. The authors argue that this near-term, small-volume market could serve as the catalyst that funds the first ISRU demonstrations, builds operational experience, and reduces technical risk in advance of the much larger propellant market, which some analyses project could approach a $63 billion valuation by 2040. NASA’s own Moon Base planning anticipates ISRU experimentation through 2032 with scalable production beginning around 2033, a timeline that aligns closely with the emergence of the habitation demand modeled in this study.

The study also acknowledges important uncertainties. The Advanced Missions Cost Model, rooted in government programs predating 1999, produced estimates 23 to 48 percent higher than the other two approaches, reflecting the cost reductions achieved through fixed-price contracting, reusability, and additive manufacturing in the commercial era. The pace at which early missions evolve toward larger crews, aggregated habitats, and regenerative life support systems remains uncertain, dependent on technology development, mission success, funding, and geopolitical factors. If future habitats add water recovery approaching 98 percent efficiency, the demand picture would shift substantially, though the authors show their methodology can be extended to those architectures. Comparable analyses could also be applied to China’s International Lunar Research Station once detailed designs become available.

What emerges is a compelling and surprisingly practical vision for the first lunar economy. Rather than waiting for a sprawling propellant infrastructure that may take decades to materialize, entrepreneurs and space agencies now have a quantified, near-term target: small habitats on the Moon that will pay hundreds of thousands of dollars per kilogram for oxygen and water if someone can produce them locally. The extrinsic benefits, including risk reduction, technology maturation, and first-to-market advantage, may further attract venture capital and public-private partnerships. If pilot-scale ISRU systems can deliver consumables at a lower lifecycle cost per kilogram than Earth resupply, the path to a sustained lunar economy may begin not with rockets refueling at depots, but with a modest plant quietly making breathable air and clean water for the crews who live there.

Subject of Research: Lifecycle cost valuation of lunar-derived oxygen and water for early Moon Base habitation as an initial market for in-situ resource utilization

Article Title: The value of lunar-derived oxygen and water for an early habitation customer

Article References: Johnson, J. E., Sowers, G. F., & Abbud-Madrid, A. (2026). The value of lunar-derived oxygen and water for an early habitation customer. Space and Planetary Resources, 2(1), Article 12. https://doi.org/10.1007/s44461-026-00017-8

Image Credits: AI Generated

DOI: 10.1007/s44461-026-00017-8

Keywords: in-situ resource utilization, lunar habitation, Moon Base, oxygen and water demand, lifecycle cost analysis, space logistics, cislunar economy, lunar ISRU, NASA Artemis, pilot plant, space resources, lunar economy