Breakdown in US-Ukraine Rare Minerals Talks

Ukraine and US Unable to Conclude Rare Earth Minerals Deal

On Friday, Ukrainian President Volodymyr Zelensky met with US President Donald Trump in Washington to sign an agreement granting the US access to Ukraine’s rare earth mineral deposits. However, the meeting took an unexpected turn, ending in a heated exchange between Zelensky, Trump, and Vice President JD Vance. Following Zelensky’s early departure, the White House announced that no agreement had been signed.

Prior to the meeting, Zelensky had shown optimism, suggesting this “initial” agreement might lead to expanded collaboration. However, he acknowledged that Ukraine still needed to obtain security assurances from the US, which was a major point for him. Trump contended that the agreement could enable American taxpayers to “recover their funds” from the assistance given to Ukraine during the conflict, but emphasized that European nations should primarily handle Kyiv’s security needs.

What Conditions Are in 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 stated that both nations would manage the fund on “equal terms.” Under the agreement, Ukraine would allocate 50% of its future revenue from state-owned mineral resources, oil, and gas to the fund. The proceeds would then be invested in initiatives aimed at enhancing Ukraine’s security, stability, and economic growth.

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

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 It has been reported that this demand was subsequently rescinded.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 highlighted the financial perspective, claiming on Tuesday that the US has given Ukraine roughly $300 billion to $350 billion in aid and that a minerals agreement could help recoup this expenditure. Conversely, the Kiel Institute, a German research organization, estimates that the real US support totals $119 billion.

Are Security Assurances Part of the Agreement?

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.

“I sought a clause concerning security guarantees for Ukraine as it is vital,” Zelensky remarked.

In response to queries about potentially walking away if security assurances weren’t included, he answered: “I seek a NATO pathway or an equivalent solution. Without security guarantees, a ceasefire won’t be feasible, and nothing will operate effectively.”

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 maintained that Ukraine would not finalize the agreement until he and Trump reached an understanding on security assurances and determined how to integrate them into the preliminary deal. Trump, however, downplayed the idea of direct US security guarantees, stating that such responsibilities should now be shouldered by Europe. He added that the presence of American workers in Ukraine would offer “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 additionally asserted that Russia is willing to permit European peacekeepers in Ukraine. However, Russian Foreign Minister Sergei Lavrov has rejected this option.

When Is the Agreement Expected to Be Signed?

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.

Ultimately, no agreement was signed. Instead, the gathering turned into a clash between Trump and Zelensky in the Oval Office. During the heated exchange, Trump accused Zelensky of not showing enough gratitude for US support and cautioned him against “risking World War Three.”

“You have to finalize a deal, or we’re withdrawing,” Trump allegedly warned Zelensky. “You lack the leverage.”

In reply, Zelensky emphasized that “no compromises” could be made with Russian President Vladimir Putin.

Shortly afterward—well ahead of schedule—Zelensky left the White House. The White House then announced that the deal had not been finalized, with Trump himself canceling the signing ceremony.

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 Mineral Wealth

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 substantial quantities of titanium and lithium. The nation also asserts it has considerable reserves of rare earth elements—17 minerals crucial for military applications, wind turbines, and electronic gadgets—although some experts question the precise extent of these reserves.

Further complicating the situation, some of the mineral-abundant regions in Ukraine are currently under Russian control. Economy Minister Yulia Svyrydenko states that mineral deposits valued at approximately $350 billion are situated in areas occupied by Russia.

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, asserting that Russia “indisputably possesses, I want to stress, far more of these resources than Ukraine.”

“Regarding the new territories, we are open to involving foreign partners in developing these areas, which have rejoined the Russian Federation,” he stated.

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.”