The project, titled HELIOS after the company behind it, has received funding from the Israel Space Agency, and is expected to develop a system that will launch two missions into space in the next three years.
The technology behind the ambitious idea is based on a special furnace that was designed to extract oxygen and various metals directly from the surface of the Moon, without requiring any supplementing materials brought from earth.
This potentially means reliant technology that would allow future human settlements on the Moon to quite literally live off the land for long periods of time without needing constant shipment of supplies from earth.
"The technology we've developed is part of a value chain that will allow permanent bases to be established outside the limits of planet earth," CEO and co-founder of HELIOS, Jonathan Geifman said, stressing the importance of focusing on basic infrastructure and the ability to produce raw materials from natural resources "in order to avoid having to endlessly transport equipment."
And while the oxygen produced by HELIOS would potentially serve astronauts for breathing, most of it would be used for launching and operating space vehicles due to its part in the chemical process leading to a combustion reaction.
According to HELIOS, "the current cost of launching materials and equipment to the Moon, Mars and beyond restricts the chances for long term extra-terrestrial human presence." However, about 45% of the total mass of the surface of Mars and the Moon is suitable for the extraction of oxygen, the company says.