The Unfinished US-Ukraine Discussions on Minerals

Ukraine and US Unable to Conclude Deal on Rare Earth Minerals

This past Friday, Ukrainian President Volodymyr Zelensky and US President Donald Trump convened in Washington with the intention of signing a deal that would allow the US to tap into Ukraine’s rare earth mineral resources. Nevertheless, the session deviated from its intended purpose and concluded with a tense discussion involving Zelensky, Trump, and Vice President JD Vance. After Zelensky’s premature exit, the White House issued a statement confirming that the agreement remained unsigned.

Previously, Zelensky had expressed optimism that this “preliminary” agreement could pave the way for further cooperation. However, he confirmed that Ukraine had yet to secure any security guarantees from the US—one of his key demands. Trump, for his part, argued that such a deal would allow American taxpayers to “recoup their money” from aid provided to Ukraine during the war, but insisted that Europe should take primary responsibility for Kyiv’s security.

What Are the Terms of the Agreement?

On Wednesday, Ukrainian Prime Minister Denys Shmyhal announced that Kyiv and Washington had finalized a draft of the agreement, which was released on Friday morning. The deal outlined the creation of an “investment fund” to support Ukraine’s reconstruction efforts.

Shmyhal mentioned that the fund would be overseen “equally” by both countries. According to the agreement, Ukraine would contribute 50% of its prospective earnings from publicly owned mineral resources, oil, and gas to the fund. The generated funds would be directed towards projects designed to bolster Ukraine’s security, stability, and economic development.

The US, for its part, committed to a sustained financial investment aimed at fostering stability and prosperity in Ukraine, in line with US law. The agreement also specified that the US would hold the largest share of the fund allowed by American rules.

Conflicts Regarding Mineral Rights and Financial Conditions

Tensions between Trump and Zelensky appear to have escalated over the specific terms of the minerals deal. Initially, the US sought a $500 billion claim on Ukraine’s mineral wealth, a demand that Zelensky rejected. Reports indicate that this request was later withdrawn.

Tymofiy Mylovanov, a former Ukrainian minister and leader of the Kyiv School of Economics, claimed that Washington initially suggested a setup that would have jeopardized Ukraine’s sovereignty and risked economic failure. However, he observed that the US has since adjusted its position, now proposing a more equitable agreement centered on co-ownership, with no direct claims related to previous aid. He suggested that this could potentially be advantageous for Ukraine.

Trump has highlighted the financial perspective, mentioning on Tuesday that the US has given $300 billion to $350 billion in aid to Ukraine, suggesting that a minerals agreement might help reclaim these funds. Nonetheless, the Kiel Institute, a German research organization, estimates that the real US assistance totals $119 billion.

Does the Agreement Include Security Guarantees?

A central sticking point for Zelensky has been the inclusion of explicit security guarantees from the US. On Wednesday, he confirmed that no such guarantees had been secured.

“Including a provision on security guarantees for Ukraine was essential,” Zelensky commented.

When questioned about possibly abandoning the agreement without security assurances, he replied: “I aim for a NATO pathway or something comparable. Without security guarantees, there will be no ceasefire, and nothing will operate.”

Despite the lack of direct security commitments, the agreement includes language indicating US support for Ukraine’s pursuit of security guarantees to achieve lasting peace.

Zelensky insisted that Ukraine would not complete the agreement until he and Trump arrived at a consensus regarding security assurances and figured out how to incorporate them into the initial deal. On the other hand, Trump minimized the notion of direct US security guarantees, asserting that Europe should now assume those duties. He further mentioned that having American workers in Ukraine would provide “automatic security.”

The concept of a minerals agreement was originally introduced by Zelensky as a means to provide the US with a tangible incentive to continue supporting Ukraine. Trump has suggested that, in exchange for mineral access, Ukraine would secure the “right to continue fighting” and that the US would keep supplying military equipment and ammunition “until a deal with Russia is reached.”

The US president has also claimed that Russia is open to allowing European peacekeepers in Ukraine. However, Russian Foreign Minister Sergei Lavrov has dismissed this possibility.

What is the Timeline for Signing the Agreement?

Trump initially announced that the agreement would be finalized during Friday’s White House meeting. Although Ukrainian Prime Minister Shmyhal verified that the final draft of the agreement was ready, Zelensky’s adviser, Mykhaylo Podolyak, explained that only a framework agreement was meant to be signed.

However, no agreement was signed. Instead, the meeting escalated into a confrontation between Trump and Zelensky in the Oval Office. At one point, an angry Trump accused Zelensky of being insufficiently grateful for US assistance and warned that he was “gambling with World War Three.”

“You need to finalize a deal, or we’re done,” Trump allegedly told Zelensky. “You lack leverage.”

Zelensky, in response, insisted that there could be “no compromises” with Russian President Vladimir Putin.

Shortly after and earlier than planned, Zelensky departed from the White House. Subsequently, the White House declared that the agreement was not completed, with Trump personally calling off the signing event.

Trump later posted on Truth Social, accusing Zelensky of having “disrespected the US in its cherished Oval Office” and stating: “He can come back when he is ready for peace.”

Currently, it remains uncertain whether the agreement will be signed or when it might occur.

Ukraine’s Rich Mineral Resources

Kyiv estimates that Ukraine possesses about 5% of the world’s “essential raw materials.” This encompasses roughly 19 million metric tons of verified graphite deposits, ranking Ukraine among the top five suppliers globally of this mineral, which is vital for manufacturing electric vehicle batteries.

Moreover, Ukraine boasts considerable deposits of titanium and lithium. The nation also asserts it possesses large reserves of rare earth elements—17 minerals vital for military tech, wind turbines, and electronic devices—although the precise extent of these reserves is contested by some experts.

Complicating matters further, some of Ukraine’s mineral-rich territories are currently under Russian control. According to Economy Minister Yulia Svyrydenko, mineral deposits worth an estimated $350 billion remain in Russian-occupied areas.

An additional challenge to extracting minerals is the extensive presence of unexploded landmines. Experts estimate that about 25% of Ukraine’s territory is affected, especially in the war-ravaged eastern areas.

There is also the issue of time. Even if the agreement is finalized, it could take years before the extraction and export of these resources yield tangible economic benefits.

“These resources aren’t stored in a warehouse ready for delivery—they require development,” Mylovanov commented. “US investment could eventually be advantageous for all involved.”

What is Russia’s Response?

Russian President Vladimir Putin has yet to comment on the reported details of the US-Ukraine deal. However, on Monday, he told Russian state television that Moscow is prepared to “offer” mineral resources to American companies for joint ventures, including mining in Russia’s “new territories”—a reference to occupied areas of eastern Ukraine.

Putin downplayed the potential US-Ukraine agreement, asserting that Russia “indisputably possesses, I want to stress, far more of these resources than Ukraine.”

“Regarding the new territories, we are prepared to welcome foreign collaborators for the development of these areas, which have rejoined the Russian Federation,” he added.

In the meantime, Kremlin spokesman Dmitry Peskov indicated on Tuesday that the situation is still evolving: “We’ll see whether [Ukraine and the US] will sign this agreement or something else. No official announcements have been made on this issue yet.”