That post, back in December of last year, kicked off the LOXLEO series. The main idea is to obviate or lessen the need for fuel to be transported from the ground into space. This would save a lot of money, obviously, so it may be worth looking for a way to implement this concept.
One problem is that you still need a fuel. You can collect nitrogen and oxygen from the upper reaches of the atmosphere, but hydrogen doesn't exist there in sufficient quantity. Assuming a LOXLEO or PROFAC device, what can be done to close this loop? That is, aside from actually going outside of orbit for materials? Like the moon or to the asteroids.
A potential solution- or more modestly- a mitigation of the limitation thus described may be achieved through manufacture of fuels in space. A particular fuel that may be possible, though apparently not easy, would be a monopropellant known as "nitrous oxide fuel blend (NOFB) monopropellant." NOFB would be made of a mixture of nitrous oxide plus a hydrocarbon fuel.
All, or most, of the components of the mixture would have to be collected and manufactured into the fuel in space.
How would the hydrocarbon fuel be manufactured? It can't without carbon. But people exhale carbon dioxide all the time. With enough people there, you could collect the carbon dioxide and make a hydrocarbon fuel out of it. It is already done on the ISS, or so I understand. But the fuel is methane, and it is not used, but vented into space. Why not put this resource to work?
You would still need to transport hydrogen and food to space. Note that hydrogen is the lightest of the elements. Therefore, to lift it would be the cheapest option amongst an expensive lot. In addition, lifting food would still be expensive. But none of the waste products would need to be disposed of. We could put those waste products to work to make fuel for our monopropellant rockets. This would not eliminate all costs, but could mitigate the costs. Every little thing can help.
Once you've got your hydrogen, you need an oxidizer. You could use the oxygen from the LOXLEO (PROFAC), or you could manufacture a powerful oxidizer also used on rockets. This would be nitrous oxide. Why throw away the nitrogen if you can use it for something?
Now, to manufacture this in space could be a challenge. A couple processes ( at least ) need to be carried up and implemented in space. One would be the Haber Process. This would produce ammonia. You would need ammonia for the second part of the manufacture, which would produce the nitrous oxide.
The nitrous oxide and the hydrocarbon fuel would then be combined for the monopropellant NOFB. The ISP ( 300) of this propellant is comparable to proven rocket fuels. With this type of fuel, it may be possible to execute a landing on the moon or on Mars.
It should warrant repeating- at the risk of being too repetitive- that this concept can be implemented in LEO, so it wouldn't be necessary to construct anything on the moon just yet. It can be used in order to get to the moon and then implement an even more economical system using lunar resources.