Ukraine and US Unable to Conclude Rare Earth Minerals Deal
On Friday, President Volodymyr Zelensky of Ukraine held a meeting with US President Donald Trump in Washington, aiming to sign a deal allowing the US to access Ukraine’s rare earth mineral resources. Nonetheless, the discussions took a surprising shift, resulting in a tense argument with Zelensky, Trump, and Vice President JD Vance. After Zelensky left prematurely, the White House confirmed that no deal was finalized.
Zelensky had earlier conveyed hope that this “initial” agreement might lead to enhanced collaboration. Yet, he acknowledged that Ukraine still hadn’t obtained any security assurances from the US—a crucial point for him. Trump contended that the agreement could enable American taxpayers to “recover their funds” from the aid given to Ukraine during the conflict, but emphasized that Europe should assume the main role in ensuring Kyiv’s security.
Details of the Agreement Terms
On Wednesday, Ukrainian Prime Minister Denys Shmyhal declared that Kyiv and Washington had completed a draft of the agreement, which was made public on Friday morning. This agreement proposed the establishment of an “investment fund” to aid Ukraine’s rebuilding initiatives.
Shmyhal noted that the fund would be jointly managed by both countries on an “equal footing.” As per the agreement, Ukraine would contribute 50% of its future income from state-controlled mineral resources, oil, and gas to the fund. These funds would then be put toward projects focused on improving Ukraine’s security, stability, and economic development.
The US, meanwhile, promised ongoing financial support to help build a stable and thriving Ukraine, in accordance with US law. The terms of the agreement also indicated that the US would hold the largest allowable portion of the fund under American regulations.
Contentions Regarding Mineral Access and Financial Conditions
The specific terms of the minerals agreement seem to have intensified the friction between Trump and Zelensky. Initially, the US demanded a $500 billion stake in Ukraine’s mineral resources, which Zelensky turned down. It has been reported that this demand was subsequently rescinded.
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 emphasized the financial aspect, stating on Tuesday that the US has provided between $300 billion and $350 billion in aid to Ukraine and that a minerals deal could help recover these funds. However, the Kiel Institute, a German think tank, estimates that actual US assistance amounts to $119 billion.
Are Security Assurances Part of the Agreement?
An important issue for Zelensky has been the insertion of clear security assurances from the US. On Wednesday, he confirmed that these guarantees had not been obtained.
“I sought a clause concerning security guarantees for Ukraine as it is vital,” Zelensky remarked.
When asked whether he would abandon the agreement if security assurances were not provided, he responded: “I want to secure a NATO path or something similar. Without security guarantees, there will be no ceasefire, and nothing will function.”
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 asserted that Russia is amenable to the presence of European peacekeepers in Ukraine. However, Russian Foreign Minister Sergei Lavrov has rejected this notion.
When Is the Agreement Expected to Be Signed?
Trump initially stated that the deal would be signed at Friday’s White House meeting. While Ukrainian Prime Minister Shmyhal confirmed that a final version of the agreement had been prepared, Zelensky’s adviser, Mykhaylo Podolyak, clarified that only a framework agreement was set to be signed.
No agreement was signed, though. Instead, the meeting escalated into a clash between Trump and Zelensky in the Oval Office. At one juncture, an irate Trump accused Zelensky of not showing enough gratitude for US aid and cautioned that he was “risking World War Three.”
“You need to make a deal, or we’re out,” Trump reportedly told Zelensky. “You don’t have the leverage.”
Zelensky countered by asserting that there could be “no compromises” with Russian President Vladimir Putin.
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 Abundance of Minerals
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.
Time is another concern. Even if the agreement is completed, it might be years before the extraction and export of these resources produce measurable economic gains.
“These resources are not stored in a warehouse ready for dispatch—they need to be developed,” explained Mylovanov. “Should the US invest, it could eventually prove advantageous for everyone involved.”
What is Russia’s Response?
Russian President Vladimir Putin has not yet made any remarks regarding the reported specifics of the US-Ukraine agreement. However, on Monday, he informed Russian state television that Moscow is ready to “offer” mineral resources to American firms for joint ventures, which includes mining in Russia’s “new territories”—referring to the occupied regions of eastern Ukraine.
Putin downplayed the potential US-Ukraine agreement as inconsequential, asserting that Russia “certainly possesses, I want to stress, far more of these resources than Ukraine.”
“As for the new territories, we are ready to attract foreign partners to develop these regions, which have returned to 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.”