Following the high tension during the meeting between Donald Trump and Volodymyr Zelensky at the White House on February 28, Kyiv has for the time being said "no" of the deal, which could give the US access to the country's mineral deposits. However, it is not yet ruled out that a deal will happen at some point, political analysts commented, quoted by the world media. The big questions are: what useful deposits does Ukraine have and why does the United States want them so much? We won't tell.
Kiev estimates that about 5% of the world's "critical raw materials" are found in Ukraine. This includes about 19 million tons of proven reserves of graphite, which, according to the Ukrainian State Agency for Geological Exploration, makes the nation "one of the five leading countries" for mineral supplies. Graphite is used to make batteries for electric cars.
Ukraine is responsible for 7% of Europe's supply of titanium, a lightweight metal used in the construction of everything from airplanes to power plants. It is also home to a third of all European lithium deposits - a key component in today's electric car batteries, writes the BBC.
Other useful deposits in Ukraine include beryllium and uranium, which are crucial for nuclear weapons and reactors. There are also significant deposits of copper, lead, zinc, silver, nickel, cobalt and manganese. In addition, the country has significant deposits of rare earth metals. This is a group of 17 elements that are used to produce weapons, wind turbines, electronics and other products that are vital in the modern world.
Some of the useful deposits, however, have already been taken over by Russia. According to Yulia Svydenko, who is the Minister of Economy of Ukraine, today in the occupied territories there are residues worth $350 billion.
ΠIn 2022, SesDev - a consulting company for geopolitical risks, based in Canada, made an assessment that stated that Russia had occupied 63% of Ukrainian coal mines, as well as half of deposits of manganese, cesium and other rare earth elements.
Dr. Robert Myga, director of SesDev, says that such minerals add a "strategic and economic dimension" to the ongoing aggression from Russia. By seizing them, he says, Moscow is effectively giving Ukraine access to resources, expanding its own consumer base, and influencing global supply chains.
Why does the US want Ukraine's minerals so badly?
Critical minerals "are at the heart of the 21st century economy," says Dr. Myga. They are of key importance for renewable energy, military applications and industrial infrastructure and play a "growing strategic role in geopolitics and geoeconomics", the expert emphasizes.
The United States is interested in the deal for Ukraine's mineral resources because it wants to reduce its dependence on China, which controls 75% of rare earth element deposits in the world, according to the Geological Investment Group. In December last year, Russia banned the export of some rare earth minerals to the United States.
How would a deal help Kiev exploit its own minerals?
Some commentators have characterized the US proposal as "colonial", but Kiev is clearly interested in adequate protection of natural resources. According to the World Economic Forum, Ukraine has about 20,000 mineral deposits, covering 116 types, but only about 15 percent of the sites have been actively exploited by the time of Russia's full-scale invasion in 2022.
For example, the country's significant lithium deposits remain largely untapped. ΠSimilarly, it is known that there are deposits of rare earth elements, but not one of them has yet been extracted due to lack of investment. The development of these mineral resources is extremely difficult and expensive, says Irina Tsyprin, CEO of Geological Investment Growth, a mining consulting company based in Ukraine.
She argues that if Ukraine manages to attract American investors to help develop its natural resources, it will be will be very useful for the country's economy.
"We will receive technologies that are so lacking in our mining industry", says the expert. And he adds:
"We will also receive capital. And this means more jobs, tax payments and a lot of income from the development of mineral deposits."