USA - Ukraine minerals deal. What is going on? Know all about here:

 

What is the minerals deal between the USA and Ukraine?

The US leader has sought an agreement from Ukraine for access to the country's natural resources in exchange for weapons. According to the US president, Donald Trump, these underground reserves (like Lithium ore) should now belong to America. The new US treasury secretary, Scott Bessent, recently visited Kyiv. He presented Ukraine’s president, Volodymyr Zelenskyy, with a surprising claim to half of Ukraine’s minerals wealth, as well as to its oil, gas, and infrastructure such as ports. In Kyiv on February 12, U.S. Secretary of the Treasury Scott Bessent presented President Zelensky with the first draft of a minerals cooperation agreement. The deal called for 50 percent of Ukraine’s resulting minerals and natural resources revenues to go to the United States as payment for previous military support for the war against Russia. This would include not only revenues from rare earth mining but the “entire economic value associated with resources in Ukraine” including uranium, lithium, oil, gas, and even some port revenues. The deal also specified that U.S. companies must hold 50 percent ownership of Ukraine’s rare earth elements deposits. The deal would override all of Ukraine’s other trade agreements. Zelensky refused to sign the agreement as it included no security guarantees for Ukraine.  Trump has said he wants $500 billion worth of Ukrainian minerals as compensation—but Zelensky claims that U.S. military aid has totaled nowhere close to $500 billion.  Negotiations are currently ongoing, with a second, less binding memorandum of understanding presented days later by Vice President JD Vance and Secretary of State Marco Rubio. Zelensky reportedly responded he could not sign the agreement without approval from Parliament. Zelensky’s team is reportedly working on a counter-proposal that includes explicit security guarantees. Zelensky is not necessarily opposed to a minerals agreement with the United States in which Ukraine offers its strategic resources in exchange for continued military support and security guarantees.  Ukrainian officials have confirmed that Zelensky has called the idea of exchanging “critical resources” as part of the “Victory Plan” he presented to Trump during a meeting.  Meanwhile, Trump administration officials are increasing pressure on the Ukrainian president to sign the current deal.  National Security Advisor Mike Waltz has called the co-investment deal “the best security guarantee they could ever hope for.” President Trump has begun issuing ultimatums, suggesting he may work towards a peace deal with Moscow instead if Zelensky does not cooperate.

The new US treasury secretary, Scott Bessent laid out some of the details of the US proposal: He said Ukraine’s revenue from “natural resources, infrastructure, and other assets” would be “allocated to a fund focused on the long-term reconstruction and development of Ukraine where the United States will have economic and governance rights in those future investments”. However, Bessent did not say how much of the proceeds from minerals extraction would be allocated to the fund or how much would be paid out to the US. Trump has presented the minerals deal as a way of ensuring Ukraine pays back previous US military aid. Those terms, described as unacceptable by Ukrainian officials, were removed in a subsequent draft, dated Saturday (February 22, 2025) and also seen by the FT (Financial Times). Ukraine’s speaker of parliament Ruslan Stefanchuk said on Saturday that Kyiv could begin finalising the deal starting Monday (February 24, 2025).  Another Ukrainian official stressed that it would be signed only once Kyiv had been given security guarantees. In his op-ed, Bessent said that the agreement would include “high standards of transparency, accountability, corporate governance, and legal frameworks necessary to attract the robust private investment for postwar growth in Ukraine” and America’s involvement “would leave no room for corruption and insider deals”.  The US Treasury secretary traveled to Ukraine earlier this month (February) on his first international trip to pitch the deal to Volodymyr Zelenskyy, the president. While US officials including Mike Waltz, Trump’s national security adviser, have said they believe a deal is close, Ukrainian officials are more guarded. “The draft on the table now needs more work,” said a person involved in negotiations. “We see there many obligations of Ukraine and very weak things [offered] from the American side, so the draft, as for today, is not ready to be accepted on the president’s level.” Negotiations continued during the weekend.  Zelenskyy has said that Bessent’s original proposal was not in Ukraine’s interest, as it demanded 50 percent of the rights to the country’s rare earth and critical minerals in exchange for past military assistance, and did not contain any offers of future assistance. Senior Ukrainian officials said they had spent the past week drawing up a counterproposal, which they discussed with the US special envoy for Ukraine, Keith Kellogg, in Kyiv on Thursday and Friday (February 20 and 21, 2025). Zelenskyy wants the Trump administration to provide security guarantees in a new proposal before they agree to sign on. In the op-ed, Bessent said the terms of the deal would “ensure that countries that did not contribute to the defense of Ukraine’s sovereignty will not be able to benefit from its reconstruction or these investments”. Bessent also suggested the US was not trying to seize control of Ukraine’s natural resources coercively. “Let’s also be clear as to what this is not. The United States would not be taking ownership of physical assets in Ukraine. Nor would it be saddling Ukraine with more debt. This type of economic pressure, while deployed by other global actors, would not advance American nor Ukrainian interests,” he wrote.

As of February 21, 2025: U.S. President Donald Trump and Ukrainian President Volodymyr Zelensky are in discussions regarding an agreement that would grant the United States access to Ukraine’s critical minerals and other valuable resources. While the specifics are still being finalized, the deal would allow the United States to obtain a portion of Ukraine’s rare earth minerals, critical minerals, and other valuable resources in compensation for the financial aid provided to Ukraine during its conflict with Russia and potentially for future aid.

The latest draft agreement of the minerals deal: 100% U.S. financial control:  The draft agreement requires Kyiv to channel half of its resource revenues through an American-controlled reconstruction fund, worth five times more than US military aid provided since 2022. Trump administration intensifies pressure on Ukraine to surrender minerals wealth control, as a new draft agreement reveals a shift from direct ownership demands to financial control, according to documents obtained by Ekonomichna Pravda on 22 February. Of the $175 billion authorized by Congress since Russia’s invasion, significant portions now hang in the balance. Strikingly, a source familiar with the negotiations told CNN that the US is demanding far more from Ukraine in mineral resources than it has spent on the country’s defense since 2022 – approximately $500 billion in resources compared to $98.5 billion in aid. “It is a strange offer to try and take from a country that is a victim of war, more than it cost to pay for its defense,” the source told CNN, highlighting why President Zelenskyy remains unwilling to accept the deal in its current form. “The agreement is not yet ready to be signed,” a Ukrainian source told Sky News, highlighting that current drafts “contain only unilateral commitments by Ukraine” – the latest sign of resistance to what many see as economic strongarming by the US. The path to this moment reveals an escalating pattern of pressure. After Ukraine rejected Trump’s initial demand for 50% ownership of its rare earth minerals, the US has now proposed a more complex but equally controlling arrangement: a reconstruction fund with 100% US financial interest, requiring Ukraine to contribute half of its resource revenues. Ukrainian media outlet Ekonomichna Pravda’s examination of the draft agreement reveals specific details of how this control would work: Ukraine must share 50% of all minerals and oil-gas revenues after expenses. The fund would specifically target infrastructure development, including extraction facilities, processing plants, and ports. For territories currently under Russian occupation, revenue sharing could exceed 50% upon liberation. All future US non-credit financial assistance would increase Ukraine’s required contributions. The agreement continues until a total sum is determined by both governments. The new draft agreement, which Ukrainian Foreign Minister Andrii Sybiha and US Secretary of State Marco Rubio are expected to sign, attempts to disguise the resource grab behind reconstruction promises. While the fund would reinvest in Ukrainian infrastructure and aim to restore pre-war GDP levels, it would give America complete financial control over these investments. Adding to the pressure, Ukraine was notably excluded from recent US-Russia talks in Riyadh, while US Defense Secretary Pete Hegseth has called pre-war borders “unrealistic” – moves widely seen as efforts to weaken Ukraine’s negotiating position. According to Ekonomichna Pravda’s review, while the agreement includes some face-saving provisions – joint management rights and guarantees about EU integration – the fundamental dynamic remains clear: Trump is leveraging military aid to gain control over Ukraine’s strategic resources, just through more sophisticated means than his initial direct ownership demand. The Ukrainian Ministry of Economy will lead the development of detailed implementation plans, though as the source emphasized to Sky News, “Today, the drafts do not reflect a partnership,” underlining the fundamental imbalance in a deal that could determine Ukraine’s economic independence for generations to come.

US minerals deal offers no security guarantees for Ukraine, NYT reports: The current U.S. proposal regarding Ukraine's critical minerals seeks 50% of revenues from Ukraine's natural resources while offering no security guarantees in return, according to a draft of the agreement seen by the New York Times (NYT). The U.S. and Ukraine have been working intensively over the past few days to hammer out the details of a revised version of the agreement. Ruslan Stefanchuk, speaker of Ukraine's parliament, said Kyiv aims to agree on Feb. 24, the third anniversary of Russia's full-scale invasion.   The terms of the revised draft are virtually the same as those of an earlier version rejected by President Volodymyr Zelensky, the NYT reported, citing a draft of the agreement dated Feb. 21. In some cases, the U.S. demands are even more stringent. The agreement demands 50% of revenues from Ukraine's natural resources, including critical minerals, oil, and gas, as well as stakes in ports and other key infrastructure through a joint investment fund. The new version says that the U.S. would hold a 100% financial interest in this fund and that Ukraine should contribute to the fund until it reaches $500 billion. This amount vastly exceeds Ukraine's actual resource revenues, which totaled $1.1 billion in 2024 and is over four times the value of U.S. aid to Kyiv. That $500 billion figure was not listed in the original proposal presented to Zelensky by U.S. Treasury Secretary Scott Bessent on Feb. 12. U.S. President Donald Trump has cited the number in public comments, claiming on Feb. 10 that Ukraine had "essentially agreed" to a $500 billion resource deal. When Zelensky then refused to sign the proposed agreement because it offered no security guarantees, Trump lashed out at the Ukrainian president, echoing Kremlin talking points by calling him an "unelected dictator." A visit from Trump's Special Envoy on Ukraine and Russia, Keith Kellogg, appeared to ease tensions and revive negotiations on the resource deal. U.S. and Ukrainian officials have reportedly been working through the night to hammer out an agreement. Trump said on Feb. 21 that the U.S. and Ukraine were "pretty close" to reaching a deal. The new document provides no specific security guarantees, according to the NYT. It instead says the U.S. will provide long-term economic development support for Ukraine. Trump said in early February that he wanted to strike a deal with Ukraine involving access to rare earth minerals in exchange for continued aid — a change in U.S. foreign policy that turned support for Ukraine's defense and sovereignty into a business transaction. Ukraine said it was open to such a deal and has stressed the need for concrete security guarantees. A former senior Ukrainian official called the first U.S. proposal "a colonial agreement" and said Zelensky could not sign the document on those terms. Reuters reported on Feb. 21 that the U.S. has threatened to cut off Ukraine's access to Starlink internet terminals if it does not sign the agreement — a claim SpaceX CEO and Trump ally Elon Musk has denied.

Development on the deal:

Bessent traveled to Ukraine this month (February 2025) to pitch the US deal to Volodymyr Zelenskyy.  The US Treasury Secretary has defended Donald Trump’s push for an agreement with Ukraine to develop its natural resources and critical minerals, saying the plan would fuel postwar growth in the country and did not involve any coercive economic pressure. However, Kyiv remains skeptical of the plan.  Scott Bessent’s comments in an op-ed for the Financial Times come as Trump administration officials are trying to clinch what they claim is an economic partnership with Kyiv as part of their broader diplomatic push to broker a peace deal between Russia and Ukraine. Ukrainian officials have so far rejected US demands for such an agreement, but US officials are applying intense pressure on Kyiv in their push for a deal.  Officials in Kyiv believe that Trump’s onslaught against Ukrainian President Volodymyr Zelenskyy recently, describing him as a dictator and suggesting Ukraine, not Russia, had started the war, are ways of strong-arming Kyiv into a minerals deal.

Earlier, Bloomberg reported, citing its source with knowledge of the talks, that Ukraine and the U.S. need more time to finalize the agreement for Ukraine's natural resources. According to Bloomberg, the draft agreement proposed by the U.S. President Donald Trump administration "currently has some questionable elements" for the Ukrainian side, without specifying them. However, U.S. National Security Advisor Mike Waltz said on Feb. 21 that the deal “was going to be done” this week, according to Sky News. "Here's the bottom line, President Zelensky is going to sign that deal, and you will see that in the very short term," he said during the Conservative Political Action Conference, as quoted by Sky News. Trump said in early February that he wanted to strike a deal with Ukraine involving access to rare earth minerals in exchange for continued aid. Trump later claimed that Kyiv had "essentially agreed" to a $500 billion resource deal. However, the latest reports come shortly after Trump accused the Ukrainian president of being "a dictator without elections," saying that "Zelensky better move fast or he won’t have a country left." On Feb. 19, Trump also said he aims to "resurrect" talks on the agreement for Ukraine's natural resources. "I think I’m gonna resurrect that deal, you know, we'll see what happens, but I’m gonna resurrect it, or things are gonna not make him (President Volodymyr Zelensky) too happy. And look, it’s time for elections," Trump said, without elaborating on the consequences for Ukraine and its president if the deal is not signed.

American access to Ukraine's rare earth minerals was first presented to President Volodymyr Zelenskyy by Treasury Secretary Scott Bessent earlier in February. It’s blackmail’: Ukrainians react to Trump's demand for $500bn share of minerals. Zelenskyy refused to sign the agreement. He made it clear Washington had to give security guarantees before any deal could be reached on the country’s vast natural resources, about 5% of global mineral reserves. He also pointed out that the US had given $69.2bn in military aid – less than the sum Trump was now demanding – and added that other partners such as the EU, Canada, and the UK might be interested in investing, too. Speaking on Wednesday (February 19, 2025), shortly before Trump called him “a dictator”, Zelenskyy said he could not “sell Ukraine away”. The president also continued his criticism of Mr Zelenskyy, saying he had "no cards" to play. "I've been watching for years, and I've been watching him negotiate with no cards. He has no cards. And you get sick of it. You just get sick of it. And I've had it," he told a Fox radio show. The comments come after he recently called the Ukrainian leader a "dictator without elections" - apparently in response to Mr Zelenskyy saying his US counterpart was living in a "disinformation space" after Mr Trump claimed Ukraine had started the war. He was willing to work on “a serious document”, he said, which ensured Russia did not attack Ukraine again. On Friday ( February 21, 2025), President Donald Trump said that Washington and Kyiv were close to reaching a deal. "I think we're pretty close, yeah. I think they want it. They feel good about it. And it's significant, a big deal, but they want it and it keeps us in that country and they're very happy about it," he said. But those comments stood in stark contrast to Zelenskyy's previous remarks on Wednesday (February 19, 2025) when he said "I can't sell Ukraine" and refused to sign the deal. Washington's demand for around $500 billion (€477 billion) in minerals wealth from Ukraine was rejected by Zelenskyy because the US had provided nowhere near that sum in military or financial aid and hadn't offered any specific security guarantees. Since 2022, the US has provided Ukraine with around $67 billion (€64 billion) worth of weaponry. The $500bn bill was “payback” for previous US military assistance to Ukraine, the White House explained. "But it's we get our money back. This should have been signed long before we went in. It should have been signed by Biden. But Biden didn't know too much about what he was doing," Trump told reporters on Friday [February 21, 2025]. President Trump has continued his recent criticism of Volodymyr Zelenskyy despite his Ukraine envoy referring to him as a "courageous leader of a nation at war". The Ukrainian source said: "The agreement is not yet ready to be signed, there are several problematic issues, and in the current form of the draft, the president is not ready to accept it. "Today, the drafts do not reflect a partnership in the agreement and contain only unilateral commitments by Ukraine." Donald Trump had said a deal was close, but a source with knowledge of the negotiations told Sky News the Ukrainian president is not ready to sign. On Saturday (February 22, 2025), business news network Bloomberg reported that both sides needed more time to reach a deal while Sky News said an agreement "is not yet ready to be signed" due to many "problematic issues." Sky News, quoting an anonymous Ukrainian source, said Zelenskyy is not ready to accept the current form of the draft. The president and his team are very much focused on continuing negotiations with both sides of this war to end the conflict, and the president is very confident we can get it done this week," White House Press Secretary Karoline Leavitt said on Feb. 22. But it is still not signed, as per recent news, Zelenskyy is visiting the US on February 28, 2025 to sing the deal. The speaker of the Ukrainian parliament has said the government will start working in earnest from Monday (February 24, 2025) to reach an agreement with the Trump administration for US access to mineral resources. Speaking to Japanese broadcaster NHK World, Ruslan Stefanchuk said a special team would start working on the proposal beginning next week (February 24, 2025 onwards) but that any agreement must include security assurances from Washington.

Zelensky ‘Not Ready’ to Sign Minerals Deal With U.S. — Source By AFP Ukrainian President Volodymyr Zelensky is "not ready" to sign a minerals deal with the United States, a source told AFP on Saturday (February 22, 2025), raising questions about Washington's demands as a rift between the two countries deepened. U.S. President Donald Trump's administration has been pressuring Zelensky into giving American companies preferential access to Ukraine's vast mineral resources as compensation for the tens of billions of dollars of aid Kyiv received under Joe Biden. Trump's national security adviser predicted Friday that Zelensky would sign the deal soon, but its contours have not been made public and Zelensky has pushed back at any arrangement that would mean "selling" his country. "In the form in which the draft is now, the president is not ready to accept, we are still trying to make changes and add constructiveness," a Ukrainian source close to the matter told AFP. Kyiv wants any agreement signed with the U.S. to include security guarantees, as it battles Russia's nearly three-year invasion.

Draft US-Ukraine rare earth minerals deal not one President Zelensky would accept, source says KyivCNN —  A draft deal between the United States and Ukraine over rare earth minerals and other natural resources is “not the one President Zelensky would accept,” according to a source familiar with the negotiations. The US is trying to gain access to Ukraine’s critical minerals and other resources as part of wider negotiations aimed at ending the war in Ukraine. In return, Ukraine has been pushing for security guarantees, with Kyiv not only keen to see the return of lost territory but also protection against a possible future Russian invasion. Ukraine was not invited to talks between the US and Russia in Saudi Arabia and this week President Volodymyr Zelensky and US President Donald Trump have been locked in an escalating war of words. Trump falsely accused Zelensky of starting the Ukraine war, while the Ukrainian leader hit back, saying the US president lives in a “disinformation space.” Ukrainians are still trying to negotiate amendments to the deal because the current draft “does not foresee any American obligations while Ukraine is expected to provide everything,” the source said. The source spoke after an official in the Ukrainian Presidential Administration told Ukrainian state broadcaster Suspilne that there would be no signing of the agreement on rare earth metals on Saturday (February 22, 2025). Work had continued on the document “all night” but was held up by the issue of “security guarantees,” Suspilne reported. The continued Ukrainian resistance to signing the deal in its current form comes after days of intense pressure from the Trump administration, whose National Security Advisor Mike Waltz even highlighted the case of an aluminum mine that could meet all the US’s annual needs if refurbished with American investment. Such a deal would reduce US dependency on China, and provide a significant incentive for the United States to boost Ukrainian security, a US official familiar with negotiations told CNN. “The draft deal provides America with financial guarantees and therefore security guarantees for Ukraine,” said the official, casting the controversial potential agreement as a reason for the United States to be invested in Ukrainian defense. “Our countries are more aligned as a result and America will receive access to critical materials, materials we won’t have to rely on China for,” the official said. “Once resources start flowing, America will have even more incentive to protect Ukraine.” The official described the role of Trump’s envoy to Ukraine and Russia, Keith Kellogg, as instrumental in getting the deal this far down the track. Also on Saturday (February 22, 2025) Ukraine’s foreign minister, Andrii Sybiha, posted that he had spoken with US Secretary of State Marco Rubio “to continue the results-oriented Ukraine-US dialogue.” “Ahead of the third anniversary of Russia’s full-scale aggression, I underscored Ukraine’s strong will to achieve a comprehensive, just, and lasting peace — one that will strengthen Ukraine and the US.”

Trump says US 'pretty close' to minerals deal with Ukraine: By Reuters NATIONAL HARBOR, Maryland, Feb 22 (Reuters) - President Donald Trump said on Saturday (February 22), that the United States is closing an agreement with Ukraine on sharing revenue from Ukrainian minerals as part of efforts to end the Ukraine war. "I think we're pretty close to a deal," Trump told a gathering of conservatives in National Harbor, Maryland, on the outskirts of Washington. He said the United States wanted to recoup the billions of dollars in military aid Washington has given to Ukraine in its fight to repel Russian invaders. He said the United States is asking for rare earths, oil, or "anything we can get.”

White House and Ukraine Close In on Deal for Mineral Rights: The agreement could help resolve tensions that flared up between Zelensky and Trump. The U.S. and Ukraine are nearing a deal that would hand valuable mineral rights to the U.S., an agreement that the Trump administration has sought as compensation for military aid to fight off Russia’s invasion, people familiar with the matter said.  Ukraine had refused to sign such a deal earlier this week, sparking a war of words between President Trump and Ukrainian President Volodymyr Zelensky and fears of a break in relations between Washington and Kyiv.

Ukraine’s work on finalizing minerals deal started on Feb. 24, parliament speaker says: Ukraine has started working to conclude an agreement with the U.S. for its natural resources on Feb. 24.    The U.S. is reportedly looking to obtain an interest in 50% of Ukraine's natural resources through a joint investment fund as payback for its support for Kyiv, according to a leaked version of the deal passed along to President Volodymyr Zelensky by U.S. Treasury Secretary Scott Bessent. According to the NHK report published on Feb. 22, the Ukrainian government will assemble an expert team to begin working on finalizing the agreement on Monday (February 24, 2025), which also marks the third anniversary of the Russian full-scale invasion of Ukraine.    Stefanchuk said Ukraine is ready to work with partners on the agreement but wants to "receive specific security guarantees," according to the report. He also said Ukraine seeks to have "constructive discussions" and a summit with the U.S.

Is Elon Musk planning to stop access to  Starlink satellite communication by Ukraine? As Washington presses Kyiv to agree to a deal, US negotiators reportedly raised the possibility of shutting Ukraine out of the Starlink satellite system. Starlink provides crucial internet access to Ukraine and is heavily used by the military to coordinate drone attacks, exchange videos from the field, and enable commanders to stay in contact with troops. Continued access to SpaceX-run Starlink was also raised in talks on Thursday (February 20, 2025)  between Zelenskyy and Trump’s Special Envoy for Ukraine and Russia, Keith Kellogg. US’ threats to cut off Ukraine’s access to Starlink was reported by the news agency Reuters on Friday (February 21, 2015), citing three anonymous sources. But after that story was published, Elon Musk, whose SpaceX company operates Starlink, posted on X that the story was "false" and accused the news agency of lying.

Unofficial reactions on the minerals deal”

“It’s as if we lost the war to America. This looks like reparations,” Volodymyr Landa, a senior economist at the Centre for Economic Strategy thinktank in Kyiv, said. Residents living near Liodiane said they supported the construction of a new lithium mine. They were not, however, ready to give the profits to Trump.  “This idea is too much,” Tetiana Slyvenko, a local administrator, said. “He wants to take resources from a country during the war. How are we supposed to live? We have children. It’s as if the US seeks to deprive us of our economic potential. It would finish us off, the same as America did with Red Indians [Native Americans].” Recently, a Shaheed missile crashed in a nearby field, not far from the shallow valley where the lithium is buried. About 300 people live in the neighboring villages of Kopanky and Haiivka, most elderly. A 72-year-old Stanislav Ryabchenko said he hoped the mine would bring young people back to the community and create jobs. “What Trump suggests is blackmail. He knows we can’t push the Russians out on our own. We need joint production, not a takeover,” he said.  US and Ukrainian negotiators were seeking to move past the spectacular breakdown in transatlantic relations and to finalize a deal, Bloomberg said on Friday (February 21, 2025). Commentators have described Trump’s aggressive ultimatum as “mafia imperialism”, a “colonial agreement”, and reminiscent of what the Europeans did in the 18th century when they carved up Africa.

Minerals reserve in Ukraine:

Rare earth elements: Rare earth elements are essentially used for consumer technology, including mobile phones, hard drives, and electric/hybrid vehicles. Ukraine's rare earth elements are largely untapped because of the war and because of state policies regulating the minerals industry. The country also lacks good information to guide the development of rare earth mining.] Ukraine’s Lithium deposits: Ukraine also holds some of Europe’s largest known reserves of lithium, which is required to produce batteries, ceramics, and glass. Ukraine’s lithium deposits are among the biggest in Europe and the US is looking for ‘payback’ for previous military assistance. How Ukraine’s new lithium mine might look? It would have a deep central shaft, with a series of side tunnels. Lithium is good everywhere. The biggest concentration is at a depth of 200-500 meters. We should be able to extract 4,300 tonnes a day. The potential is terrific. The deposit is buried under a large sloping field, used in communist times to grow beetroot and wheat. The mine’s proposed entrance is in an abandoned former-Soviet village, Liodiane, today a scruffy grove of acacia and maple trees. The only inhabitant is a security guard, who lives on the 150-hectare site in an ancient Gaz-53 truck. Wild boar and even a wolf sometimes wander past. The lithium deposit is located in central Ukraine’s Kirovohrad region, about 350km (217 miles) south of the capital, Kyiv. Solar-powered scientific instruments measure air temperature and seismic activity. In 2017 a Ukrainian company, UkrLithiumMining, bought a government licence to exploit the site for 20 years. It cost $5m. Geological surveys confirm that the ore, known as petalite, can be used to produce batteries for electric vehicles and mobile phones. Volodymyr Landa, a senior economist at the Centre for Economic Strategy think tank in Kyiv, said: Ukraine’s overall reserves are worth $14.8tn. They include lithium, titanium, and uranium, as well as coal, steel, iron ore, and undersea shale gas. Many deposits had not been developed, Landa said, either because they were not feasible or due to political instability. Others are in areas occupied by Russia. Ukraine’s lithium deposits – about 500,000 tonnes’ worth – are among the biggest in Europe. One site is in Kruta Balka, near the southern port of Berdiansk, which the Kremlin occupied early in its 2022 invasion. Another is in the Shevchenkivskyi district, on the frontline in the eastern Donetsk oblast. Russian troops recently took control of the area. The deposit in Liodiane is one of two under Ukrainian control. According to Landa, Ukraine’s minerals sector has “high risks and high rewards”.  There is a long history of foreign investment, he said, with French, Belgian, and British engineers developing the country’s coal industry in the 19th century. The city of Donetsk – seized by Russia in 2014 – was originally named Hughesovka, after the Welsh businessman John Hughes, who founded a steel plant and several coal mines in the region. Denys Alyoshin, UkrLithiumMining’s chief strategy officer, said his company was looking for foreign investment. It would cost $350m to build a new and modern mine, under EU environmental standards, he said. He acknowledged that construction could begin only once Russia’s war against Ukraine was over. Ideally, he said, Ukraine would process the ore in the country into a concentrate. This would then be refined into battery-grade lithium carbonate. Trump has said he wants a share of “rare earth”, a class of 17 minerals. Ukraine has few of these. The US president appears to have confused them with rare metals and critical materials, such as lithium and graphite. Alyoshin said there was a further misconception that quick profits could be made. “People think you put a shovel in the ground and dig up money. We have been working on this project for five or six years. With investment we can begin production in 2028,” he said. Miscellaneous facts -1: In Liodiane, Soviet geologists discovered the seam half a century ago but decided it was not worth exploiting because, in the pre-electric vehicle era, lithium was used in the ceramic and glass industries. Hrechukha, the mining company’s local representative, said there was a readily available workforce after a uranium mine 20km down the road in the town of Smolino was decommissioned last year. His firm was keen to cooperate with outside partners, he stressed, but only based on international law. He said he respected the world’s richest man, Elon Musk, whose Tesla car business required lithium. “We are interested in a long-term client,” he said. In the meantime, the US was far away. “I don’t think US soldiers are going to be coming here anytime soon,” Hrechukha predicted, surveying the white field. Miscellaneous facts -2: Geological data is thin because mineral reserves are scattered across Ukraine. The existing studies are considered largely inadequate and the industry's true potential is clouded by insufficient research. However, the outlook for Ukrainian natural resources is promising. The country's reserves of titanium, a key component for the aerospace, medical, and automotive industries, are believed to be among Europe’s largest. In 2021, the Ukrainian minerals industry accounted for 6.1% of the country’s gross domestic product and 30% of exports. An estimated 40% of Ukraine's metallic mineral resources are inaccessible because of Russian occupation, according to data from We Build Ukraine, a Kyiv-based think tank. The European Commission identified Ukraine as a potential supplier of more than 20 critical raw materials and said that if the country joins the EU, it could strengthen the European economy.

Q: How likely is the proposed U.S.-Ukraine deal to move the needle on U.S. minerals security? Answer: It’s unlikely to be consequential in the medium term given the barriers to investment. First, there is very limited data on whether Ukraine’s rare earth elements and other strategic materials are commercially viable to mine. According to the former director general of the Ukrainian Geological Survey, there is no modern assessment of rare earth reserves in Ukraine. Existing mapping was done 30–60 years ago by the Soviet Union and relies on old exploration methods. Considerations that impact the commercial feasibility of mining deposits include depth, ore grade, by-products, and location. Second, the war has wiped out essential infrastructure. Mining is among the most energy-intensive industries worldwide. It accounts for approximately 38 percent of global industrial energy use and around 15 percent of total electricity consumption globally. Between 2022 and 2023, nearly half of Ukraine’s power generation capacity was either occupied by Russian forces, destroyed, or damaged, while about half of the country’s large network substations sustained damage from missile and drone strikes. As a result, Ukraine has been left with only about one-third of its prewar power capacity. There will need to be a significant buildout of energy infrastructure for minerals exploration or production can commence. And finally, mining companies are hesitant to make long-term investments given the looming security risk in Ukraine. Mining is a long-term and capital-intensive investment. Globally, it takes an average of 18 years to develop a mine—and costs $500 million and $1 billion to build a mine and separation plant. A new mine can run for over 50 years. Confidence in the political and economic stability of a jurisdiction is critical given the size and longevity of the investment. While Trump, Putin, and Zelensky may reach a peace deal, the threat of further conflict and land expropriation will loom given the long-standing nature of the conflict. The Russia-Ukraine war, the deadliest conflict in Europe since World War II, started 11 years ago. After Ukraine’s Maidan Revolution, Russian forces took control of Crimea in early 2014. Russia later engaged in the conflict in the Donbas, leading to Russian and Russian-backed forces occupying parts of Donetsk and Luhansk in eastern Ukraine.

Q: What do these developments mean for U.S.-Ukraine relations under Trump, and what are the implications for the future of Ukraine and NATO security? Answer: Trump has consistently vocalized throughout his campaign run and first few weeks in office that he would be taking a different approach to the Russia-Ukraine conflict compared to the Biden administration over the last three years. While the Biden administration aimed to isolate Russia on the international stage via tightening sanctions, Trump has opened diplomatic doors to Moscow with a 90-minute phone call weeks into his second term, high-level in-person talks with representatives from the administration, and a tentative meeting between President Trump and President Putin in Saudi Arabia soon. Additionally, while Biden consistently prioritized arming and aiding Ukraine, Trump has taken a more transactional approach and questioned the utility of continuing to financially and militarily bolster Ukraine. Tensions have risen considerably between Trump and Zelensky, as critical mineral resources access is the latest arena for Trump to focus his transactional methods of diplomacy. But the viability of the deal remains to be seen as tensions continue to rise between the two world leaders. Trump seemingly blamed Ukraine for starting the war with Russia and called Zelensky a “dictator without elections.” Meanwhile, Secretary of Defense Pete Hegseth has said U.S. troops would not be deployed to Ukraine as part of any security guarantees for the country. Under the Trump administration, Ukraine, Europe, and NATO as a whole are likely to face a great decline in security guarantees from the United States without offering strategic resources or financial compensation in return.

Q: Is there any precedent for a resource-for-aid swap? Answer: It’s an unprecedented move for the United States—but it’s a tried and tested tool out of China’s playbook. The Sino-Congolaise Des Mines (Sicomines) agreement, signed in 2007, is a prime example. This resource-for-infrastructure arrangement granted Chinese companies access to cobalt, copper, and other minerals in return for infrastructure development. China committed approximately $3 billion to infrastructure projects, securing mining rights to deposits near Kolwezi in the southeastern Democratic Republic of the Congo (DRC), valued at an estimated $93 billion. At the time, it was the only way for the DRC to get the capital needed to build. However, in the long term, the DRC got shortchanged. The government recently revisited the resource for infrastructure deal with Chinese investors out of concern that some mining contracts are not sufficiently benefiting the country.

The latest update on the minerals deal as of February 26, 2025:

https://www.cnbc.com Ukraine and the United States reached an agreement over access to Kyiv’s deposits of rare earth minerals, according to media reports. The draft deal envisages that the two countries will jointly develop Ukraine’s mineral resources, including oil and gas, and sees the U.S. drop demands for a right to $500 billion in potential revenue from the agreement, according to the Financial Times. It’s unclear how much minerals wealth lies within Ukraine.

https://www.bbc.com/news Ukraine has agreed to the terms of a major minerals deal with the US, a senior official in Kyiv has told the BBC. "We have indeed agreed on it with several good amendments and see it as a positive outcome," the official said, without providing any further details. Media reports say Washington has dropped initial demands for a right to $500bn (£395bn) in potential revenue from utilizing the natural resources but has not given firm security guarantees to war-torn Ukraine - a key Ukrainian demand.

https://www.france24.com US, Ukraine agree to minerals deal but no security promise for Kyiv An agreement that would give the US access to Ukraine's rare earth minerals could be signed as early as Friday, with Ukrainian President Volodymyr Zelensky set to travel to Washington to meet President Donald Trump, according to one Ukrainian official on Tuesday.

Disclaimer: The best efforts are made to provide updated and authentic information through this blog. However, the data is collected and summarized from the below-mentioned websites.  This blog is not AI-generated and compiled manually. In any case, the author does not take any responsibility (legal or otherwise) for its correctness, completeness, discrepancies, typographical errors, or any contradictions with other data. Any further use of data and its consequences lies with the user only. https://www.euronews.com/ https://www.theguardian.com https://www.ft.com https://www.csis.org https://www.reuters.com https://www.wsj.com https://news.sky.com https://edition.cnn.com https://kyivindependent.com https://www.themoscowtimes.com https://euromaidanpress.com https://www.thoughtco.com https://en.wikipedia.org

My personal opinion: The minerals deal will be signed soon. There is no alternative to Ukraine. Ukraine has committed the mistake of stretching the war to this level.  In return, the country has been pushed back for several years in terms of development,  lost its sovereignty/territory, and is burdened with huge debt along with pinching terms and conditions. **** Hope for the best****