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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.
What Conditions Are in the Agreement?
On Wednesday, Prime Minister Denys Shmyhal of Ukraine declared that Kyiv and Washington had completed a draft version of the agreement, which was made public on Friday morning. The arrangement proposed the establishment of an “investment fund” aimed at aiding 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.
Conflicts Regarding Mineral Rights and Financial Conditions
It seems that the discord between Trump and Zelensky intensified due to particular aspects of the minerals agreement. Initially, the US proposed a $500 billion stake in Ukraine’s mineral assets, which Zelensky declined. Sources suggest that this demand was subsequently revoked.
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?
A key issue for Zelensky has been obtaining clear security assurances from the US. On Wednesday, he affirmed that no such assurances 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 conclude the agreement until he and Trump arrived at a consensus on security assurances and devised a way to incorporate them into the preliminary deal. Trump, on the other hand, minimized the necessity of direct US security guarantees, asserting that these obligations should now fall to Europe. He mentioned that the involvement of American workers in Ukraine would provide “automatic security.”
Zelensky initially proposed the idea of a minerals agreement as a way to offer the US a concrete motivation to maintain its support for Ukraine. Trump has implied that, in return for granting mineral access, Ukraine would ensure the “right to keep fighting,” and that the US would continue providing military gear and ammunition “until an agreement with Russia is achieved.”
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.
When Is the Agreement Expected to Be Signed?
Trump initially mentioned that the agreement would be finalized at the White House meeting on Friday. Although Ukrainian Prime Minister Shmyhal affirmed that a definitive version of the deal was ready, Zelensky’s adviser, Mykhaylo Podolyak, explained that only a framework agreement was intended for signing.
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, 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 shared on Truth Social, accusing Zelensky of having “disrespected the US in its esteemed Oval Office” and declaring: “He can return when he is prepared 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’s reserves account for about 5% of the world’s “critical raw materials.” This comprises around 19 million metric tons of verified graphite reserves, positioning Ukraine as one of the top five global providers of this essential mineral for electric vehicle battery manufacturing.
Additionally, Ukraine has significant deposits of titanium and lithium. The country also claims to hold substantial reserves of rare earth elements—17 minerals essential for military technology, wind turbines, and electronic devices—though some experts dispute the exact scale of these reserves.
Adding to the complexity, certain mineral-abundant regions of Ukraine are presently under Russian control. Economy Minister Yulia Svyrydenko has indicated that mineral deposits with an estimated value of $350 billion are situated in areas occupied by Russia.
A further challenge to mineral extraction is the extensive presence of unexploded landmines. Experts estimate that approximately 25% of Ukraine’s terrain is affected, especially in the conflict-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 Has Been 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, asserting that Russia “indisputably 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.
Meanwhile, Kremlin spokesman Dmitry Peskov suggested on Tuesday that the situation remains fluid: “Whether [Ukraine and the US] will sign this agreement or something else, we’ll see. There have been no official statements on this matter yet.”
