Introduction to chemical rocket transportation
Rockets using chemical combustion for energy are the main propulsion system man has used in space to date. We use rockets to get off of the Earth, to go from one orbit to another, and for satellite stationkeeping and maneuvering.
One of the first products to be made from asteroidal and lunar materials will be propellants for transportation. This may include fuel for combustion rockets. The propellants will be used to transport the asteroidal and lunar materials back to Earth orbit, as well as to sell in low Earth orbit for moving satellites around (e.g., from low Earth orbit to geosynchronous Earth orbit). This is a product which may be easy to make from asteroidal material, and from lunar material as well.
For example, the space Shuttle went only to a very low Earth orbit. For launching to geosynchronous orbit, much more propellant was needed. Indeed, if a satellite was launched in the Space Shuttle to low Earth orbit and relaunched there to go to geostationary orbit, two thirds of the cargo in the Shuttle's payload bay by weight was fuel and only one third is the satellite, if it was a fuel for chemical combustion rocketry. It was argued that by providing fuel from the Moon and asteroids, we could triple the payload capacity to low Earth orbit, thereby allowing larger, more competitive communications satellites and future services.
Alternatively, once in space, there are better means of propulsion than chemical rocketry, which are significantly less expensive over time for hauling large quantities of goods, such as ion drive. They get far more mileage out of a given amount of fuel, but they are much slower and also require a sizeable electric power source.
Once we start to industrialize space, we will surely assemble large "space trucks" in low Earth orbit to haul payloads around space much more efficiently, using something else besides chemical rocketry.
However, for people, who need to be transported quickly, we can assume we will be using chemical rocketry in the first stage of large scale space development.
A rocket is a device that burns fuel for propulsion. The fuel burn is a chemical reaction between a "fuel" and an "oxidizer". There are four kinds of chemical rocket:
Rockets are known to be dangerous. They depend on a controlled explosion. For Earth launch, they depend upon very high thrust due to Earth's strong gravity and the weight of the vehicle plus the payload plus fuel to be used later in flight. This is why the Space Shuttle uses two solid rocket boosters. (It was a solid rocket booster failure than destroyed the Space Shuttle Challenger.)
Fortunately, for use in space, rockets are much less dangerous. The thrust required to get off the Moon is very small compared to that on Earth. Moving from orbit to orbit can be done slowly and gently, which is why rockets in orbital space very rarely explode. Launching off of an asteroid is practically the same as doing an interorbital maneuver.
For example, when we launch the Space Shuttle, the cargo makes up only about 2% of the total. The fuel and the vehicle make up the majority. When you look at a rocket on Earth's surface, you're looking mostly at fuel and vehicle, with a little payload on top.
In contrast, for the vehicle that lifted the Apollo astronauts off the Moon, the fuel required was so little that it fit in a corner of the vehicle and the fuel tank could have served as a chair.
The key to space development using asteroidal and lunar materials is the ability to make the fuel propellants from these materials, rather than blasting the fuels up from Earth.
The Moon has plenty of oxygen, which makes up 86% to 89% of oxygen-hydrogen rocketry, as since lunar dirt averages 44% oxygen bound into minerals. Extracting this oxygen from lunar soil is fairly simple, and the processing schemes generally aim to produce other useful materials, too. The hydrogen is rare on the Moon except at the lunar poles where it exists in extremely cold form.
Many asteroids are rich in frozen water, and oxygen-hydrogen rocket fuel is readily producible.
Asteroids are also rich in carbon, too, which can be used in rocket fuels, e.g., hydrocarbon fuels. The same may apply to the lunar poles.
Many lunar development schemes propose using substitutes for the hydrogen, e.g., powdered aluminum, which would still be mixed with oxygen for combustion. Aluminum powder based engines have been researched dating back to the Apollo days when NASA planned to develop the Moon, but the technology hasn't been developed yet for in-space applications and indeed has been shelved without an application in today's Earth launch world.
The following are details of producing fuel propellants from asteroidal and lunar materials.
Asteroidal chemical fuels
The first step is in production of hydrogen and oxygen is extraction of water from the asteroid. All that's needed is to deploy a solar oven, e.g., an array of foil mirrors focused on a tank. Asteroidal material is put in the tank and heated. Water, free hydrogen, compounds of carbon (e.g., carbon monoxide, carbon dioxide, and various hydrocarbons such as methane), sulfur and a few other gases are liberated by the heating. Pipes from the oven lead to a series of very cold tanks in the cold shadows of space, which trap the volatiles in tanks. Since they liquify at different temperatures and pressures, they are easily separated from each other.
This method should produce enough free hydrogen and free oxygen to fuel the return spacecraft. If not, then the water can be split up into hydrogen and oxygen by electrolysis, again an old technology.
If desired, hydrocarbon fuels can be collected and used, or manufactured from the hydrogen and carbon.
This is all such simple and old technology that little further research is needed to establish this as an option.
Notably, there's an analysis on sulfur-based fuel propellants by Steve Howe of the Sandia National Laboratories. Sulfur is abundant on asteroids (some very high in iron sulfide, aka "troilite"), and might be abundant in spots on the Moon. On some mineralogically interesting asteroids, the sulfur may be the most expendable material.
Lunar chemical fuels
With the recent discovery of water in permanently shadowed craters of the lunar poles by the Clementine 1, Lunar Prospector, and LCROSS probes, oxygen-hydrogen rocketry would be feasible from the Moon, which would make lunar resources much more attractive economically. The same means can be used to produce rocket fuel from water as is discussed for asteroids.
(There are tradeoffs in building a big solar oven in zero-gravity around an asteroid vs. the surface of the Moon, plus heat sink issues for the tanks, and rotation of the Moon, but these seem like minor issues. The lunar craters are extremely cold since they never get any sunshine, which calls for research and development on equipment operating in that environment.)