Colony Lun is Gudersnipe's boneyard. It is a graveyard of old ships in orbit around a main-sequence star which has no planetary bodies, making the colony the only thing there.
The bulk of Colony Lun's mass is made up of several decommissioned Mercury Ships, that, over the ages, were deemed too difficult to scrap. The remains of G.S.S. Mercury can be found there, and dozens of others.
Whenever possible, the school recycles ships, typically into new ships. Mercury ships pose a challenge, however, as their incredible mass and extremely thick armor are difficult to pull apart. Further, the armor is layered, making it necessary to either reprocess the material or seperate the layers. All told, it is often easier to mine new material.
Before a ship can be added to Colony Lun, it must be deemed 0% combat-ready, meaning all weapon systems must be removed or irreparable. Some non-weapon systems may be left functional, but most ships dumped at Colony Lun will never be usable again.
As of late in the Sixth Age, Colony Lun forms a circle 1/3rd of the way around the sun.
Though never formally stated, it has been insinuated by some known members of the Blind Consul that Colony Lun has a purpose and an eventual goal. Mourik Black stated publicly (though unofficially) that "We are trying to build a Ring World. But... we aren't trying very hard, so it's taking a while".
Colony Lun is part of a stellar cluster designated a 1000-light-year "No-Go" zone, into which non-Foundation ships are not permitted. Even the Alliance is not allowed to send starships there for any reason. As a result, no civilian has ever seen Colony Lun (though the stellar cluster does include Utopia Gregaria and numerous other important Foundation worlds). The full-time population of the Colony is only a few tens of thousands.
However, the estimated bulk of Colony Lun (by now several times the mass of a typical rocky planet) is still considerably more than the published masses of all the spaceships which have been scuttled there. This has led to speculation that the colony is also the site where the Foundation scrapped the superships belonging to the old Gudersnipe Army. In particular, this is thought the resting place of the Master Ships and Mercury Ships used during the Mage Wars. Based on conservative estimates, there may be as many as twenty-five continent-sized spacecraft in the debris that make up Lun.