Republican presidential nominee former President Donald Trump, right, and Ukraine’s President Volodymyr Zelenskyy shake hands during their meeting at Trump Tower, Sept. 27, 2024, in New York. (Julia Demaree Nikhinson/AP)
(Tribune News Service) — President Donald Trump says the minerals beneath Ukraine could form the basis for a “trillion-dollar deal” to shore up vital U.S. supply chains. Ukrainian President Volodymyr Zelensky says his country’s mineral wealth is “priceless.”
But as the two leaders prepare to meet in Washington on Friday, where they are expected to hammer out details of an agreement that would grant the United States partial access to Ukraine’s minerals, the real value of the resources on the bargaining table remains uncertain.
The full extent of what lies below ground in Ukraine is not totally clear, and the work of mining and processing minerals is slow, messy and can require vast new infrastructure, with uncertain costs. In many cases, that means deposits are not economically viable to exploit.
Extracting many of the critical minerals the United States seeks would “require billions in investment,” said Robert Muggah, principal at SecDev, a geopolitical and digital risk company that has studied Ukraine’s resources.
Whatever comes of the deal, it would be a long-term bet. For Kyiv, that could be an upside as its seeks to grant Washington a material stake in Ukraine’s future. At least one key factor remains unresolved: While Zelensky said he would push for a U.S. security guarantee in any deal, Trump said this should fall to European allies.
“The big problem is that to develop a new mine might take 10 years” or more, said Willy Shih, a Harvard economist who studies supply chains. “Is anyone going to do that in a Ukraine that doesn’t have security guarantees? In other words, how investable is it really?”
Trump in his second term has shown an intense interest in critical minerals, apparently out of concern about China’s growing domination across a range of resources. He mentioned minerals in remarks about gaining territory in Canada and Greenland, and he said Ukraine’s mineral wealth should be used to repay the cost of U.S. aid since Russia invaded the country three years ago.
While they have differed over the terms, U.S. and Ukrainian officials are eager for some sort of minerals deal, arguing that the value of Ukraine’s resources will grow rapidly as demand soars and competition with China heats up.
The Biden administration also considered access to resources a priority. But new projects are hard to make economically viable when Chinese production keeps prices low, said Alex Jacquez, a former White House official who worked on industrial policy.
“There are massive deposits of these shiny new critical minerals and rare earths that everyone is now focused on around the world,” Jacquez said. “There’s a reason there’s not a massive influx of new production outside of China.”
The most significant mapping of Ukraine’s mineral resources was performed in the Soviet era. Details of key mineral deposits, including titanium and lithium, have been classified since. “It’s a very outdated approach,” said Roman Opimakh, former director general of the Ukrainian Geological Survey.
Some experts noted that more than a decade ago, U.S. officials said Afghanistan was sitting on $1 trillion in minerals. Trump later expressed interest in these resources in his first term. But those minerals are still sitting there, untapped.
“Ukraine has significant mineral potential, but how large that potential is, we simply don’t know,” said Rod Eggert, deputy director of the Critical Materials Innovation Hub at Colorado School of Mines.
Both sides are expected to seek new data as they negotiate. But even that preliminary work could be costly and time-consuming.
Ukrainian officials admit a large portion of the country’s mineral resources are in territory held by Russia, including the resource-rich Donbas region. SecDev’s estimates found that 40 percent of critical minerals were in Russian-controlled areas, Muggah said.
In some cases, resources the United States claims to be seeking from Ukraine might not be plentiful. Trump said Tuesday that the proposed deal would include “rare earths and other things.” But the U.S. Geological Survey does not record Ukraine as having significant deposits of rare earths, a category of 17 elements with varied high-tech and industrial functions.
Ukraine is known to have significant deposits of lithium, graphite, uranium and titanium — minerals that are sometimes mistakenly included among rare earths. All four have been listed as “critical minerals” by the U.S. Geological Survey, an indication that their global supply chains are threatened.
These are important raw materials for the future. Lithium and graphite are both crucial for batteries that power electric vehicles, while uranium is used for nuclear energy.
As strong as steel but some 45 percent lighter, Titanium is used in alloys important to the commercial aerospace and defense industries. Ukrainian officials have said that up to 20 percent of the world’s supply of titanium is in Ukraine’s earth, though other estimates are far lower.
To turn Ukraine’s large deposits of minerals such as ilmenite, a titanium-iron oxide, into “titanium sponge,” the first stage in making the metal, requires intensive and expensive methods — and only then can it be combined into valuable alloys.
“It’s the processing that is key,” Shih said. “It’s dirty and energy-intensive.”
The United States stopped making titanium sponge in 2020, citing the high cost compared with cheaper imports. While Ukraine can make titanium sponge, its only plant — Zaporizhzhia Titanium-Magnesium — has halted production because it is close to the front line.
Russia and China dominate the global market, which is widely acknowledged in the West as a major supply chain issue. One giant state-backed Russian firm has continued to supply Western aerospace companies during the war in Ukraine.
Velta, a Ukrainian company, is experimenting with a new, quicker way of making titanium alloys. But it could be some years away from large-scale use, said Matthew Murray, a former Obama administration official who chairs Velta’s advisory board.
Murray said he hoped a Ukraine-U.S. deal would allow more investment in the project, as Trump “clearly has in mind that he wants to be able to compete with China more effectively.”
While titanium is being mined, other Ukrainian resources lie dormant. Ukraine’s State Geological Service estimates that the country has 500,000 metric tons of lithium reserves — among Europe’s largest deposits and around 3 percent of global supply.
But Ukraine does not extract lithium, in part because deposits are based in petalite, a type of mineral that makes mining and processing more expensive, said Volodymyr Landa, an economist with the Kyiv-based Center for Economic Strategy.
Soviet-era infrastructure still dominates. The Zavallivsky graphite mine in central Ukraine has not been modernized since the height of the Cold War. Refining graphite to battery grade requires extra processes that would cost even more and are hazardous to the environment.
“Most Western nations struggle to compete with China due to energy costs and environmental regulations,” said Pierre Josso, deputy director of the U.K. Critical Minerals Intelligence Center.
Ukraine’s only producer of uranium ore, meanwhile, is the state-owned VostGOK. Its mining costs are so high that it cannot currently turn a profit. Before the war, Ukraine’s nuclear industry relied on uranium from Russia.
Ukraine does have large-scale extraction industries outside of critical minerals. The country has enormous iron ore reserves, which it uses as the raw ingredient for its sprawling steel industry. But there, too, old Soviet technology dominates. The war has hindered plans to transition to “green” steel, which uses hydrogen rather than fossil fuels and requires a different type of iron ore.
Oil and gas have also been mentioned in discussions of the deal and would probably be more economically viable faster.
Results on critical mineral projects, on the other hand, might take decades.
“It’s a capital-intensive business, and it’s a long-term project,” said Opimakh, the former director general of the Ukrainian Geological Survey. But, he said, that does not mean it would not pay off eventually. “To satisfy the demand” for new technology, “you need critical minerals,” he said.
Leo Sands contributed reporting.
