Ukraine Submits Revised Mineral Deal to USA for Protection – A Misread of the Situation?

Highlights

• Ukraine submitted a revised minerals agreement to the U.S., hoping to secure continued military support in its conflict with Russia.
• Despite political rhetoric, Ukraine has limited rare earth element reserves.
• Approximately 50% of critical minerals are located in Russian-held territories.
• The Trump administration’s $500 billion mineral demand appears to be based on a misunderstanding of Ukraine’s actual mineral potential.

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Ukraine has submitted a revised draft of the minerals agreement to the United States, aiming to secure continued U.S. military support in its conflict with Russia. This move follows President Donald Trump’s demand for $500 billion worth of rare earth minerals from Ukraine as compensation for the extensive U.S. aid provided to Kyiv. The reworked deal is seen as Ukraine’s effort to align with the Trump administration’s expectations and ensure ongoing assistance. The specifics of the agreement, including any security guarantees for Ukraine, remain undisclosed. This development underscores the strategic importance of Ukraine’s mineral resources in its diplomatic engagements with the U.S.

Reported by The Telegraph (opens in a new tab) in the UK, recent discussions around Ukraine’s mineral wealth, particularly from Trump administration officials, have conflated rare earth elements (REEs) and critical minerals. While both categories are strategically important, they are fundamentally different, and Ukraine’s actual resources do not align with claims of vast untapped reserves.

Ukraine’s critical minerals are found in many regions of the country, including the center, east, southeast, and northwest. However, much of Ukraine’s coal and metal resources are now under Russian control.

Rare Earth Elements – Limited Reserves in Ukraine

Despite political rhetoric suggesting otherwise, Ukraine does not have large ready-to-exploit reserves of rare earth elements (REEs)—the 17 elements crucial for high-tech applications, including defense, renewable energy, and electronics. Unlike China, Australia, and the United States, which dominate REE production, Ukraine’s rare earth potential remains underexplored and limited.

Critical Minerals: At least 50% in Russian-Occupied Territory

However, Ukraine has deposits of various critical minerals, including lithium, titanium, and zirconium—materials vital for aerospace, battery production, and industrial applications. The problem? A significant portion of these deposits lies in Russian-occupied territories in the Donbas and Crimea. Russia’s ongoing control of these areas severely restricts Ukraine’s access to its own critical mineral wealth, raising questions about how much leverage Kyiv truly has in mineral-based negotiations with the U.S.  Note the top deposits of rare earth metals.

Geopolitical Implications

While securing future U.S. investment in Ukraine’s mining sector is strategically important, expectations should be tempered by the geological and geopolitical realities. The Trump administration’s demand for $500 billion worth of rare earths in exchange for continued aid appears to be based on a possible misreading of Ukraine’s actual mineral potential. Rare Earth Exchanges estimates about 50% of both  REE and critical minerals are located in the Russian-held east.                  Unless Kyiv can regain full territorial control and attract major investments in exploration and extraction, its ability to deliver on large-scale mineral deals will remain constrained.

Ukraine’s mineral wealth is real but possibly overstated in the political discourse. And the real prize—if Ukraine regains its occupied territories—lies in critical minerals, and some potential rare earths deposits. Again many of them are currently held by Russia.