The oxygen compressor puts oxygen into a oxygen tank. You're going to need it if you want to survive in space.
The Oxygen Compressor, once connected to an Oxygen Pipe with sufficient oxygen flowing through it, will refill depleted oxygen tanks that are placed inside.
There is a bug that will not fill up a tank because of a "Not Enough Power" message, to fix this: Make sure you are connecting oxygen over an "Oxygen Pipe", not directly! Another bug is that the electric compressor sometimes duplicates items. If you play on a server, the compressor might be banned.