Ukraine's $15 trillion resource deal aims to rival China

President Donald Trump announced that he expects a visit from Volodymyr Zelensky at the White House on Friday, during which an agreement on the extraction of rare earth metals in Ukraine is to be signed.

According to Denys Shmyhal, the country's Prime Minister, the Ukrainian government expects to approve the final version of the agreement on Wednesday. As per the Ukrainian Prime Minister, the agreement outlines the creation of a special investment fund between the United States and Ukraine, to which Ukraine would contribute 50% of the revenue from the "future monetization" of state mineral resources, including oil, gas, and related logistics.

An expert from the Polish Geological Institute notes that Ukraine currently holds some of the largest reserves of critical raw materials in Europe, which are essential for the advancement of space, defense, and energy technologies. The country ranks among the top ten in documented titanium deposits and holds one-third of Europe's lithium resources. Additionally, Ukraine has significant amounts of tantalum, niobium, beryllium, cobalt, nickel, and graphite. The estimated value of these resources (not just rare earths) is $15 trillion.

The utilization of these resources signifies a tremendous leap in civilizational development, akin to the transition from the Stone Age to the Iron Age, said Andrzej Jagielski. He added that countries with access to these resources could develop much faster and also determine where these valuable minerals will be distributed. This means, he explained, that the pace of development in various regions will depend on them.

When asked about the properties of critical resources, Jagielski provided the example of neodymium, a small amount of which can alter the properties of metal alloys. For instance, neodymium magnet discs are virtually unbreakable, whereas non-enhanced discs can be separated even by a child, he explained.

At present, China controls 68% of the world's rare earth metals market, including the world's largest rare earth metals mine in Bayan Obo, Inner Mongolia. Furthermore, in recent years, with government support, Chinese companies have acquired valuable deposits in Africa. Many lithium, cobalt, titanium, and other resources essential for making batteries, wind turbines, medical devices, smartphones, computer disks, lasers, and electric and hybrid vehicles come from there.

According to Jagielski, the specificity of Ukrainian critical resource deposits is that they are located in Europe, under favorable geological conditions (shallow below or on the surface, also in the form of placers), and largely remain untapped. Some were discovered during the Soviet era, but extraction was deemed too costly due to the crystalline rock formations they are found in.

However, today extraction technologies are more advanced, and resource prices are high enough that these deposits appear as a great treasure, the geologist explained. These resources stretch from the northwest of Ukraine down to the Sea of Azov.

Jagielski noted that 70% of valuable deposits are located in areas occupied by Russia. There is also a deposit area along the Belarusian border by the Pripyat River, and the possible movement of Belarusian troops to seize these deposits raises concerns, he assessed.

In his view, granting the United States access to Ukrainian rare resource deposits could enable the U.S. to surpass China in this market segment, strengthening its position in the global economy.

Rare earth metals, also known as rare earth elements, consist of 17 chemical elements, which include: scandium, yttrium, lanthanum, cerium, praseodymium, neodymium, promethium, samarium, europium, gadolinium, terbium, dysprosium, holmium, erbium, thulium, ytterbium, and lutetium.