Ukraine’s Mineral Wealth: US-Ukraine Rare Earth Deal, Geopolitical Importance, and Challenges

What’s in Today’s Article?

• Ukraine Mineral Resources Latest News
• Importance of Ukraine’s Mineral Resources
• US Proposal on Ukraine’s Resources
• Challenges in the US Using 50% of Ukraine’s Resources
• Ukraine Mineral Resources FAQs

Ukraine Mineral Resources Latest News

• Former US President Donald Trump accused Ukraine of reneging on an unofficial deal granting the US access to 50% of its mineral resources in exchange for support against Russia.

Importance of Ukraine’s Mineral Resources

• Ukraine possesses rich mineral resources crucial for manufacturing high-end weapon systems, clean energy solutions (such as electric vehicles), electronic gadgets, and semiconductors. 
• These minerals are rare and difficult to extract, making them highly valuable.

Geopolitical Significance

• China has large reserves of these critical minerals, making Ukraine’s resources strategically important for the US and the West. 
  • The US seeks rare-earth elements, titanium, gallium, and other critical minerals for weapons systems, clean energy, and reducing dependence on China.
• US President Donald Trump’s interest in acquiring Greenland is also partly driven by mineral resource concerns.

Key Classifications of Minerals

• Rare Earth Elements (REEs): Consist of 17 elements, including 15 Lanthanides (atomic numbers 57–71), Scandium (21), and Yttrium (39).
• Critical Minerals: Defined by countries based on economic and security needs and their limited availability.
  • India identified 30 critical minerals in 2023.

US Proposal on Ukraine’s Resources

• Ukraine views the deal as a way to secure future assistance, while Trump seeks compensation for past US aid.
• The details remain undisclosed, but Trump claims Ukraine owes the US $500 billion worth of resources, including minerals, fuel, and infrastructure (such as ports), in return for military support against Russia.
• This demand far exceeds the $69.2 billion in military aid the US has provided since 2014.
• US officials argue that securing economic stakes in Ukraine—such as mining rights—would serve as a security guarantee, as the US would be invested in defending its interests.
• Zelenskyy, however, seeks a more concrete military and economic assurance rather than indirect security through economic involvement.

Challenges in the US Using 50% of Ukraine’s Resources

• Legal Restrictions
  • Ukraine’s constitution states that subsoil resources belong to its people.
  • Any deal must comply with Ukrainian laws.
• Unclear Resource Data
  • The quantity and quality of Ukraine’s mineral resources remain uncertain due to limited exploration and extraction.
  • Many geological surveys date back to the Soviet era (pre-1991) and lack modern data.
• Existing EU Agreement
  • Ukraine already signed a ‘strategic partnership on raw materials’ with the European Union in July 2021, before Russia’s invasion in 2022.
  • This agreement complicates any new deal with the US.
• Russian Occupation of Resource-Rich Areas
  • A significant portion of Ukraine’s minerals are in Russian-occupied territories.
  • Russian forces control one-fifth of Ukraine, including reserves of rare earth elements.
  • They are now just 4 miles away from the Shevchenko lithium deposit, as per a media report.

Ukraine Mineral Resources FAQs

Q1. What are the critical minerals in Ukraine?

Ans. Ukraine has rare-earth elements, titanium, gallium, and lithium, essential for defense, clean energy, semiconductors, and electronics manufacturing.

Q2. Is Ukraine rich in mineral resources?

Ans. Yes, Ukraine has vast reserves of rare-earth elements, titanium, and other critical minerals, making it geopolitically and economically significant.

Q3. Which countries have critical minerals?

Ans. China, Australia, the US, Canada, Russia, and Ukraine possess significant critical mineral reserves crucial for global industries and technologies.

Q4. Does India have critical minerals?

Ans. Yes, India identified 30 critical minerals in 2023, including lithium, cobalt, and rare-earth elements, essential for energy and technology sectors.

Q5. Who is the largest producer of critical minerals in the world?

Ans. China dominates critical mineral production, controlling major reserves of rare-earth elements, lithium, cobalt, and other essential industrial minerals.

Source: IE | FP