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Ukrainians are learning the transactional nature of the Trump administration as the US president revealed a “critical” (pun intended) part of his plan for ending the three-year old conflict.
Media reports say that Scott Bessent, the US treasury secretary, met with Ukrainian President Zelensky on Feb. 12. The two discussed a minerals deal between Kyiv and Washington that would provide Ukraine with a post-war “security shield”.
At stake are $500 billion in rare earth minerals that Trump wants before offering a security guarantee from Washington.
Bessent said the minerals deal is part of a “larger peace deal that Trump has in mind”. Zelensky told reporters on Wednesday that the United States presented Ukraine with a first draft agreement he hoped could seal a deal at the February 14-16 Munich Security Conference.
“We had a productive, constructive conversation. For me, the issue of security guarantees for Ukraine is very important, and we talked about minerals in general,” said Zelensky, via Reuters.
Trump has said he wants a rapid end to the war between Ukraine and Russia but has not made clear whether he will continue vital military aid to Ukraine that was a cornerstone of President Biden’s foreign policy.
According to Radio Free Europe/ Radio Liberty, Trump spoke directly with Russian President Putin on Feb. 12 for more than an hour, agreeing to begin peace negotiations.
According to the Ukrainian Geological Survey, Ukraine holds 23 of the 50 strategic materials identified by the US as critical, and 26 out of the 34 recognized by the EU as critically important. Particularly, Ukraine holds competitive positions in titanium, graphite, lithium, beryllium, and rare earth elements.
There are currently 30 licenses issued for the development of this group of minerals. The Ukraine government holds over 30 unlicensed deposits and about 400 promising occurrences. It also manages several important industrial assets capable of fabricating titanium, aluminum, silicon, germanium and gallium.
Titanium and beryllium are used in aerospace and defense, with Ukraine holding the largest titanium reserves in Europe.
The country has reserves of lithium and graphite — used in lithium-ion batteries needed for a plethora of uses including electric vehicles and renewable energy storage. Graphite is used in the battery’s anode.
However, no lithium is currently mined in Ukraine, with two of four potential sites located in Russian-occupied territory.
Ukraine can reportedly supply battery factories with natural graphite concentrate, with six known deposits, one of which is operated by Australia-headquartered Volt Resources. Licenses were issued for three more graphite deposits in 2019 and 2021.
The extraction of tantalum, niobium and rare earth elements is centered around the Novopoltava phosphate deposit and the Azov REE deposit — both of which are in occupied territory.
The United States currently only has one producing rare earths mine — Mountain Pass in California owned by MP Materials. Australia-based Lynas is building a rare earths processing facility in Seadrift, Texas. In 2023, Nasdaq-listed coal miner Romaco Resources announced initial development work on the Brook rare earths mine in Wyoming would start in the fourth quarter.
Along with large percentages of rare earth oxides, the mine may contain meaningful amounts of gallium and germanium — said Mining Weekly — used widely in semiconductors and defense systems. China controls the supply of both, and in July 2023 introduced new export controls, followed by a ban on exports to the US in December 2024.
China also controls more than 85 percent of the world’s rare earth processing capacity and mines most of the minerals. According to the US Geological Survey, China holds 44 million tonnes of reserves, more than double the nearest competitor Brazil, and compared to the United States’ 1.9 million tonnes.
Between 2020 and 2023, the US imported 70 percent of its rare earth metals and compounds from China.
