Ukraine And Us Finalize Preliminary Rare Earth Minerals Deal: Key Details And Reactions

Ukraine Has Announced The Finalization Of A Preliminary Agreement With The United States, Granting American Access To Its Vast Rare Earth Mineral Deposits. Ukrainian President Volodymyr Zelensky Expressed Optimism That The Agreement Would Lead To Further Deals, Though He Confirmed That No Formal American Security Guarantees Have Been Included At This Stage.

Terms Of The Deal

While the full details remain undisclosed, Ukrainian Prime Minister Denys Shmyhal revealed that the deal includes the establishment of an investment fund dedicated to Ukraine’s reconstruction. The fund will be jointly managed by Ukraine and the US on equal terms.

Under The Terms Of The Agreement:

• Ukraine will allocate 50% of future revenues from state-owned mineral resources, oil, and gas to the fund.

• The fund will be used to invest in Ukraine’s infrastructure and economic recovery.

• The US will hold the maximum stake permitted under American law, though it will not necessarily own the entire fund.

Negotiations were reportedly strained in recent weeks due to an initial US demand for $500 billion in mineral wealth, which Ukraine rejected. However, the final terms appear to be more favorable to Kyiv, according to sources within the Ukrainian government.

US President Donald Trump has stated that the deal will help American taxpayers recoup funds sent to Ukraine as aid, estimated at between $300 billion and $350 billion, though independent estimates place US aid at $119 billion.

Does The Deal Include Security Guarantees?

Despite Zelensky’s push for security assurances, the preliminary deal does not include formal guarantees from the US. Zelensky emphasized the importance of security provisions and hinted that Ukraine may not move forward without them.

“If we don’t get security guarantees, we won’t have a ceasefire. Nothing will work,” Zelensky told the BBC.

Shmyhal clarified that the deal would not be signed until Zelensky and Trump reach an agreement on security terms. Trump has indicated that the US will continue supplying equipment and ammunition to Ukraine until a broader peace deal with Russia is reached.

When Will The Deal Be Signed?

Shmyhal confirmed that Ukraine’s government has approved the final version of the agreement, and Zelensky is expected to sign it during a visit to Washington on Friday.

Ukraine’s Rare Earth Mineral Reserves

Ukraine is home to approximately 5% of the world’s critical raw materials, including:

• Graphite: 19 million tonnes of proven reserves, crucial for electric vehicle battery production.

• Titanium, Lithium, and Rare Earth Elements: Essential for weapons manufacturing, wind turbines, electronics, and various modern technologies.

However, a significant portion of Ukraine’s mineral wealth remains under Russian control. Economy Minister Yulia Svyrydenko estimates that around $350 billion worth of resources are located in occupied territories.

Another challenge to mineral extraction is Ukraine’s landmine contamination, with an estimated 25% of the country’s landmass affected.

Russia’s Reaction

Russian President Vladimir Putin has not directly commented on the deal, but he suggested that Russia is open to offering similar resources to American partners in joint mining projects, including in occupied Ukrainian territories.

Kremlin spokesman Dmitry Peskov stated that Russia is monitoring the situation but has yet to issue an official response.

Conclusion

The Ukraine-US minerals deal represents a strategic move by Kyiv to secure economic support while incentivizing continued American assistance. However, the absence of security guarantees may complicate the finalization of the agreement. As negotiations continue, all eyes remain on Zelensky’s upcoming visit to Washington, where the fate of the deal will likely be decided.