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U.S. President Donald Trump and Ukrainian President Volodymyr Zelensky are in discussions regarding an agreement that would grant the United States access to Ukraine’s critical minerals and other valuable resources. While the specifics are still being finalized, the deal would allow the United States to obtain a portion of Ukraine’s rare earth minerals in compensation for the financial aid provided to Ukraine during its conflict with Russia and potentially for future aid.
Q1: What is the proposed minerals deal between the United States and Ukraine?
A1: In Kyiv on February 12, U.S. Secretary of the Treasury Scott Bessent presented President Zelensky with the first draft of a minerals cooperation agreement. The deal called for 50 percent of Ukraine’s resulting mineral and natural resources revenues to go to the United States as payment for previous military support for the war against Russia. This would include not only revenues from rare earth mining but the “entire economic value associated with resources in Ukraine” including uranium, lithium, oil, gas, and even some port revenues. The deal also specified that U.S. companies must hold 50 percent ownership of Ukraine’s rare earth elements deposits. The deal would override all of Ukraine’s other trade agreements.
Zelensky refused to sign the agreement as it included no security guarantees for Ukraine. Trump has said he wants $500 billion worth of Ukrainian minerals as compensation—but Zelensky claims that U.S. military aid has totaled nowhere close to $500 billion. Negotiations are currently ongoing, with a second, less binding memorandum of understanding presented days later by Vice President JD Vance and Secretary of State Marco Rubio. Zelensky reportedly responded he could not sign the agreement without approval from Parliament. Zelensky’s team is reportedly working on a counter-proposal that includes explicit security guarantees.
Zelensky is not necessarily opposed to a minerals agreement with the United States in which Ukraine offers its strategic resources in exchange for continued military support and security guarantees. Ukrainian officials have confirmed that Zelensky has called the idea of exchanging “critical resources” as part of the “Victory Plan” he presented to Trump during a meeting last fall. Meanwhile, Trump administration officials are increasing pressure on the Ukrainian president to sign the current deal. National Security Advisor Mike Waltz has called the co-investment deal “the best security guarantee they could ever hope for.” President Trump has begun issuing ultimatums, suggesting he may work towards a peace deal with Moscow instead if Zelensky does not cooperate.
Q2: How likely is the proposed U.S.-Ukraine deal to move the needle on U.S. minerals security?
A2: It’s unlikely to be consequential in the medium term given the barriers to investment. First, there is very limited data on whether Ukraine’s rare earth elements and other strategic materials are commercially viable to mine. According to the former director general of the Ukrainian Geological Survey, there is no modern assessment of rare earth reserves in Ukraine. Existing mapping was done 30–60 years ago by the Soviet Union and relies on old exploration methods. Considerations that impact the commercial feasibility of mining deposits include depth, ore grade, by-products, and location.
Second, the war has wiped out essential infrastructure. Mining is among the most energy-intensive industries worldwide. It accounts for approximately 38 percent of global industrial energy use and around 15 percent of total electricity consumption globally. Between 2022 and 2023, nearly half of Ukraine’s power generation capacity was either occupied by Russian forces, destroyed, or damaged, while about half of the country’s large network substations sustained damage from missile and drone strikes. As a result, Ukraine has been left with only about one-third of its prewar power capacity. There will need to be a significant buildout of energy infrastructure for mineral exploration or production can commence.
And finally, mining companies are hesitant to make long-term investments given the looming security risk in Ukraine. Mining is a long-term and capital-intensive investment. Globally, it takes an average of 18 years to develop a mine—and costs $500 million and $1 billion to build a mine and separation plant. A new mine can run for over 50 years. Confidence in the political and economic stability of a jurisdiction is critical given the size and longevity of the investment. While Trump, Putin, and Zelensky may reach a peace deal, the threat of further conflict and land expropriation will loom given the long-standing nature of the conflict. The Russia-Ukraine war, the deadliest conflict in Europe since World War II, started 11 years ago. After Ukraine’s Maidan Revolution, Russian forces took control of Crimea in early 2014. Russia later engaged in the conflict in the Donbas, leading to Russian and Russian-backed forces occupying parts of Donetsk and Luhansk in eastern Ukraine.
Q3: What do these developments mean for U.S.-Ukraine relations under Trump, and what are the implications for the future of Ukraine and NATO security?
A3: Trump has consistently vocalized throughout his campaign run and first few weeks in office that he would be taking a different approach to the Russia-Ukraine conflict compared to the Biden administration over the last three years. While the Biden administration aimed to isolate Russia on the international stage via tightening sanctions, Trump has opened diplomatic doors to Moscow with a 90-minute phone call weeks into his second term, high-level in-person talks with representatives from the administration, and a tentative meeting between President Trump and President Putin in Saudi Arabia in the near future. Additionally, while Biden consistently prioritized arming and aiding Ukraine, Trump has taken a more transactional approach and questioned the utility of continuing to financially and militarily bolster Ukraine.
Tensions have risen considerably between Trump and Zelensky, as critical mineral resource access is the latest arena for Trump to focus his transactional methods of diplomacy. But the viability of the deal remains to be seen as tensions continue to rise between the two world leaders. Trump seemingly blamed Ukraine for starting the war with Russia and called Zelensky a “dictator without elections.” Meanwhile, Secretary of Defense Pete Hegseth has said U.S. troops would not be deployed to Ukraine as part of any security guarantees for the country.
Under the Trump administration, Ukraine, Europe, and NATO as a whole are likely to face a great decline in security guarantees from the United States without offering strategic resources or financial compensation in return.
Q4: Is there any precedent for a resource-for-aid swap?
A4: It’s an unprecedented move for the United States—but it’s a tried and tested tool out of China’s playbook. The Sino-Congolaise Des Mines (Sicomines) agreement, signed in 2007, is a prime example. This resource-for-infrastructure arrangement granted Chinese companies access to cobalt, copper, and other minerals in return for infrastructure development. China committed approximately $3 billion to infrastructure projects, securing mining rights to deposits near Kolwezi in the southeastern Democratic Republic of the Congo (DRC), valued at an estimated $93 billion. At the time, it was the only way for the DRC to get the capital needed to build. However, in the long term, the DRC got shortchanged. The government recently revisited the resource for infrastructure deal with Chinese investors out of concern that some mining contracts are not sufficiently benefiting the country.
Gracelin Baskaran is the director of the Critical Minerals Security Program at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Meredith Schwartz is a research associate for the Critical Minerals Security Program at CSIS.
