What Led to the Halt in US-Ukraine Mineral Agreement

Ukraine and US Unable to Conclude Deal on Rare Earth Minerals

This past Friday, Ukrainian President Volodymyr Zelensky and US President Donald Trump convened in Washington with the intention of signing a deal that would allow the US to tap into Ukraine’s rare earth mineral resources. Nevertheless, the session deviated from its intended purpose and concluded with a tense discussion involving Zelensky, Trump, and Vice President JD Vance. After Zelensky’s premature exit, the White House issued a statement confirming that the agreement remained unsigned.

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 Are the Terms of 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, in turn, pledged a long-term financial commitment to fostering a stable and prosperous Ukraine, subject to US law. The agreement also stipulated that the US would own the maximum share of the fund permitted 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.

Does the Agreement Include Security Guarantees?

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.

“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.”

Although there are no explicit security commitments, the agreement contains language expressing US support for Ukraine’s efforts to obtain security guarantees to secure enduring 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.”

Zelensky initially proposed the idea of a minerals agreement as a way to give the US a concrete reason to keep backing Ukraine. Trump has implied that, in return for access to minerals, Ukraine would obtain the “right to continue fighting,” with the US continuing to provide military gear and ammunition “until an agreement with Russia is achieved.”

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 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.

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 need to finalize a deal, or we’re done,” Trump allegedly told Zelensky. “You lack leverage.”

Zelensky, in response, insisted that there could be “no compromises” 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 took to Truth Social, alleging that Zelensky had “disrespected the US in its esteemed Oval Office” and remarked: “He can return when he is prepared for peace.”

At this point, it remains unclear whether or when the agreement will be signed.

Ukraine’s Abundance of Minerals

Kyiv estimates that Ukraine holds around 5% of the world’s “critical raw materials.” This includes approximately 19 million metric tons of confirmed graphite reserves, placing Ukraine among the top five global suppliers of this mineral, which is crucial for electric vehicle battery production.

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.

Another obstacle to mineral extraction is the widespread presence of unexploded landmines. Experts estimate that around 25% of Ukraine’s landmass is contaminated, particularly in the war-torn eastern regions.

Time poses another issue. Even if the agreement reaches completion, it may take years before the mining and export of these resources deliver concrete economic advantages.

“These resources are not sitting in a warehouse waiting for shipment—they must be developed,” Mylovanov explained. “If the US invests, it could ultimately benefit all parties.”

What is Russia’s Response?

Russian President Vladimir Putin has not yet addressed the reported particulars of the US-Ukraine agreement. Nonetheless, on Monday, he informed Russian state television that Moscow is willing to “provide” mineral resources to American companies for cooperative ventures, including extraction in Russia’s “new territories”—alluding 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 prepared to welcome foreign collaborators for the development of these areas, which have rejoined 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.”