(LONDON) — President Donald Trump’s pursuit of a deal to access Ukrainian mineral resources has upended America’s transatlantic ties in recent weeks, with the White House unsettling European allies and Ukrainian partners with a push for future profits.
Trump on Tuesday lauded the draft agreement as a “very big deal,” one that he said will grant Kyiv “military equipment and the right to fight on.”
Various estimates suggest there could be hundreds of billions — perhaps even trillions — of dollars worth of rare earth minerals under Ukrainian soil. Among them are thought to be significant deposits of lithium, titanium, copper, nickel, cobalt, graphite and uranium.
Just before Russian President Vladimir Putin launched his nation’s full-scale invasion of Ukraine in February 2022, Ukraine’s Deputy Minister of Environmental Protection and Natural Resources Svetlana Grinchuk said her nation was one to “about 5% of all the world’s ‘critical raw materials.'”
Nonetheless, there is a paucity of information on the extent and accessibility of Ukrainian mineral resources.
“Unfortunately, there is no modern assessment” of rare earth reserves in Ukraine, Roman Opimakh — the former director general of the Ukrainian Geological Survey — told S&P Global Commodity Insights this month. “And there is still restriction to make this information public.” Current estimates are based on Soviet-era mapping and exploration methods, he added.
Indeed, the section of the Ukraine’s State Service of Geology and Subsoil website detailing the country’s potential reserves is not currently accessible. “In accordance with legal requirements, open access to this section of the site is limited for the period of martial law,” a message reads.
The resources that are there will not necessarily be easy to reach, Gracelin Baskaran and Meredith Schwartz of the Center for Strategic and International Studies wrote this month.
The financial returns of Trump’s would-be deal are “unlikely to be consequential in the medium term given the barriers to investment,” they wrote.
The war has wiped out “essential” mining infrastructure, they added, as well as the power generating capabilities needed to feed intensive mining projects. “There will need to be a significant buildout of energy infrastructure” for mineral exploration or production to commence,” the authors said.
The development of a single mine can cost up to $4 million, Oleksandr Vodoviz — the head of the chief executive officer’s office at Metinvest Group — said. Developing a facility akin to the coking coal plant in Pokrovsk in eastern Ukraine — which is the largest enterprise in Ukraine — would require around $10 billion.
Persistent security risks may also deter required investment. “While Trump, Putin, and Zelenskyy may reach a peace deal, the threat of further conflict and land expropriation will loom given the long-standing nature of the conflict,” Baskaran and Schwartz said.
The geographical spread of Ukraine’s minerals complicates the security picture. Many concentrations of the most valuable resources are in the east of the country, including in territory currently occupied by Russian forces and along the devastated front line, within range of Russian weapons.
President Volodymyr Zelenskyy, seemingly aware of the global appeal of Ukraine’s natural resources, cited them in his October 2024 “Victory Plan.”
The fourth of its five points noted Ukrainian natural resources as “our opportunity for growth,” and offered its strategic partners investment opportunities in this arena. This point also had a secret annex that was only shared with designated partners.
The U.S. is set to lead the foreign investment charge. A senior Ukrainian official told ABC News on Tuesday that the two sides had agreed the terms of the proposed deal.
Trump did not confirm the U.S. had agreed, instead telling reporters he had heard that Ukrainian President Volodymyr Zelenskyy will visit Washington, D.C., to finalize the compact on Friday. “It’s OK with me if he’d like to,” Trump said.
The president has framed the minerals deal as a means to recoup American wartime aid to Ukraine, claiming — without offering evidence — that the U.S. has contributed $350 billion to Kyiv over three years.
The deal foresees the creation of a jointly-owned U.S.-Ukrainian reconstruction investment fund, through which resources can be owned and developed.
A Ukrainian government source told ABC News that the latest version of the agreement does not include the initial U.S. demand of access to resources worth $500 billion, nor the opening position that the U.S. would entirely own the proposed investment fund.
It also appears that the resources the agreement does not cover resources that currently contribute to the Ukrainian budget — that means no oil and gas, or likely the majority of the country’s mineral resources.
Carl Bildt, the former Swedish prime minister and co-chair of the European Council on Foreign Relations, told BBC News the mineral deal seems like a “sideshow” and mostly designed to “keep Mr. Trump happy.”
“But it is not going to give a lot of money to the U.S., and I don’t see it having any materially economic effect for very many years,” Bildt said.
Ukraine is demanding security guarantees as part of the deal, though ABC News understands that provision is not currently part of the draft agreement. Zelenskyy and Trump are expected to discuss the issue when the former travels to Washington, D.C. on Friday.
ABC News’ Will Gretsky, Patrick Reevell and Natalia Popova contributed to this report.
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