Luxembourg Stakes Initial 200 Million Euros to Become Silicon Valley of Space Resources

The Government of Luxembourg is staking 200 million Euros to kick-start the nascent space resources utilization business — prospecting for and eventually mining and selling resources extracted from the Moon, asteroids or other solar system bodies.  The country’s Prime Minister and Deputy Prime Minister made the announcement Friday flanked by former European Space Agency (ESA) Director General Jean-Jacques Dordain and former NASA Ames Research Center Director Pete Worden.

Prime Minister Xavier Bettel and Deputy Prime Minister Etienne Schneider spoke at a press conference in Luxembourg to discuss the country’s spaceresources.lu initiative, announced in February, and how it fits into the government’s overall strategy to become “one of the top 10 space faring countries in the world.”  Dordain and Worden are members of the government’s advisory board for the initiative.

Former ESA Director General Jean-Jacques Dordain, Luxembourg Prime Minister Xavier Bettel, Luxembourg Deputy Prime Minister Etienne Schneider, and former NASA Ames Research Center Director Pete Worden at Luxembourg space resources initiative press conference June 3, 2016.  Screengrab from webcast.

Although the Grand Duchy of Luxembourg is a small country with a population of just 570,000, it already has a significant presence in the space business as the corporate home of the two largest global fixed communications satellite operators, SES and Intelsat.  SES established its headquarters in Luxembourg in 1985 and Bettel and Schneider referenced that event several times as Luxembourg’s entry into the space business. 

Just as it passed a law at that time to create the legal framework for communications satellite services, Bettel and Schneider announced that they now will press forward with a new law to govern space resource utilization.  Schneider said Luxembourg wants to be the European center for asteroid mining and to be the first European country to establish its own legal framework for that purpose.  When asked if the new law will only cover asteroids or will the Moon, for
example, also be included, Schneider replied it is “everything in outer
space.”

Luxembourg has a streamlined governmental structure that should allow it to move quickly.  Bettel is not only the Prime Minister, but also the Minister of Communications and Media, Minister of State, Minister for Religious Affairs, and Minister of Culture.  Schneider similarly wears several hats — Deputy Prime Minister, Minister of the Economy, Minister of Internal Security and Minister of Defence.  A constitutional monarchy, it has a unicameral legislature — the 60-member Chamber of Deputies.   Bettel said he will propose the new legislation this year and expects to pass next year.

One difference between the Luxembourg law and the space resource utilization provisions of the U.S. Commercial Space Launch Competitiveness Act (CSLCA, also called the SPACE Act) enacted in 2015, Schneider said, is that the U.S. law applies only to U.S. companies with majority U.S. capital.  The Luxembourg law will be “open to all investors” located in Luxembourg, so companies seeking international capital will be able to find it there.  “I don’t know why the Americans limited themselves to American capital, but we will not.”

The relevant portion of CSLCA (Title IV of P.L. 114-90) applies to U.S. citizens as defined in section 50902 of title 51 of the U.S. Code — (A) a U.S. citizen, (B) an entity organized or existing under U.S. law, or (C) an entity organized or existing under the laws of a foreign country if the controlling interest is held by (A) or (B).

Two U.S. companies focused on asteroid mining, Deep Space Industries (DSi) and Planetary Resources Inc, already have or plan to establish European headquarters in Luxembourg, Schneider said.  DSi and Luxembourg announced a partnership last month to build a 3U cubesat, Prospector-X, to test technologies needed for asteroid mining (propulsion, avionics and optical navigation) in low Earth orbit.  Planetary Resources, which bills itself as “the asteroid mining company,” but just announced plans to build an earth remote sensing satellite, is also working with Luxembourg and Schneider said a Memorandum of Understanding would be signed soon for cooperation in both space resource utilization and earth observation.

The Luxembourg government established an advisory board that includes Dordain and Worden, who joined Bettel and Schneider at Friday’s press conference.  Dordain said the main goal is to attract entrepreneurs and investors to Luxembourg, bringing jobs.  Worden added that his experiences in Silicon Valley (close to NASA-Ames) were a foundation for his work on the advisory board and he foresees Luxembourg becoming the Silicon Valley for space resources, a sentiment Schneider echoed.

Schneider revealed that his government has provided a 200 million Euro (approximately $230 million) line of credit to get started on creating the legal framework and for investing in new ventures.  The money will be used for research and development (R&D) grants and other purposes, including Luxembourg becoming a shareholder in companies like DSi or Planetary Resources.  He also made clear that the 200 million Euros is just the beginning.  If more is needed, “we will be able to provide that money,” he promised.

Luxembourg is a member of ESA and currently co-chairs, together with Switzerland, the ESA Council of Ministers.  Schneider is Luxembourg’s representative in that capacity.  He noted that initially Luxembourg considered working through ESA on this initiative, but determined it would be too difficult to reach agreement with all of ESA’s member states in the short term.  Instead, Luxembourg will go it alone for now, but he noted that other ESA members are interested and future collaboration will be discussed at December’s Ministerial Meeting.   He and Bettel expressed repeatedly that it takes someone to take the risk to kick-start new ideas like this and Luxembourg wants to be that one.