Who Ukraine’s critical minerals really belong to
The Oval Office blow-up: who should reap the benefits from Ukraine’s critical minerals? Is it a resource for victory, or a bank account for Trump to cash out?
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Lidiia Halkina, who for 24 years oversaw miners who extract Ukraine’s natural resources from the earth, is glad the U.S.-Ukraine critical minerals deal wasn’t signed last week.
“I think Trump ignored our president. He thought Zelenskyy would fall into his lap and say that Ukraine would capitulate,” she said. “Our President noted that the Russian aggressor has been destroying Ukraine for 11 years in a row and no one cared about anything that happened. For Ukraine, security guarantees and peace are the most important things.”
Lidiia remained devoted to her mining job even as Russians shelled her home village in 2014, and Russian paramilitaries proclaimed that they had control of the Luhansk region.
“Rockets were flying while we sat in the basement, and the shelves were shaking,” said Lidiia, who spent most of her working life at a mine in Ukraine’s Donbas region, a few miles from the Russian border. “But we didn't consider leaving our home or stopping production.”
She ultimately had to leave after the full-scale invasion. For eleven years she has been hopeful that Ukraine’s rich mineral wealth might help it win the war. But now, Lidiia's faith is shaken, with talk that Ukraine’s mineral wealth might be taken by its American allies.
Ukraine has rich deposits of rare earth metals which are essential to the country's economy. They help economic growth, enhance energy independence, increase tech potential, and give it strategic importance in the global market.
The U.S., up until now Kyiv’s most important strategic partner, has been signalling that it wants control over these resources as ‘payback’ for its help in the last three years of war. Will Ukraine receive a good deal, such as NATO membership, or will it have to give up its resources for almost nothing?
President Zelenskyy was the first to propose that Ukraine’s allies reach a special agreement over the “joint protection” of its critical resources as part of his Ukrainian victory plan, which he hoped would win over Donald Trump.
Discussions between Ukraine and the United States intensified in early February when Trump started to ramp up the pressure, announcing he wanted to strike a deal in which Kyiv would supply the United States with rare earths and minerals in exchange for previously-provided American aid.
Volodymyr Zelenskyy met with Donald Trump in Washington on Friday to sign an agreement – and of course, the rest is history. An Oval Office blowup in front of the press of the likes we’ve never seen before. The deal was left unsigned.
For 24 years, until February 2022, Lidiia Halkina worked at the Toshkivka coal mine in the Luhansk region. As the head of an independent trade union of miners, she was responsible for organizing workers, and maintaining a safe workplace.
Amidst the latest news about an agreement over minerals, Lidiia thinks a deal between Ukraine and the U.S. could impact the war's course for the worse. Ukraine has about 20,000 deposits encompassing 116 types of minerals, which is approximately five percent of the world's total resources. The country’s mineral resources are valued at nearly $15 trillion.
Ukraine's subsoil holds approximately 10 percent of the world's lithium reserves, which are used in battery production, while the country also accounts for 7 percent of global titanium production. In addition, Ukraine also possesses significant reserves of zirconium, which is utilized in jet engines, and scandium, a metal that is used in the aerospace and automotive industries.
A U.S.-Ukraine Minerals Agreement would help reduce America's dependence on China, which controls about 70 percent of the world's critical minerals. Ukraine's critical minerals are also crucial for producing weapons systems, and electronics, and developing aviation and space technologies.
“These reserves and fields were discovered during the Soviet era. And, since everyone has all the data, Moscow knows precisely what we have. Suppose we look at where the Russian military is moving and take a geological map of Ukraine's largest deposits. By analyzing this map and the strategies of Russian occupation in Ukrainian territories, we can gain insights into their military goals for seizing Ukrainian resources,” explained Ksenia Orynchak, CEO of the National Extractive Industries Association of Ukraine.
Now, almost a third of Ukraine’s deposits are currently under Russian occupation.
The Toshkivka coal mine, where Lidiia worked, is now in occupied territory too. From 2014, it operated under constant shelling and explosions, while the power often went out after heavy bombardment.
Mining at Toshkivka in wartime was not easy. Thanks to the dangerous methane gas that is found in the mines, workers’ underground shifts were never supposed to exceed six hour stints, even with protective masks and equipment. However, given the risks above ground, it was hard to tell when it was safe to leave the mine, meaning they often risked being trapped below ground.
By 2022, the mine building was also heavily damaged by shelling, making it impossible to operate. The reserves at this coal mine had been estimated at 70 years of further production.
Following its independence in 1991, Ukraine inherited mining infrastructure from the Soviet era, primarily focused on coal, iron ore, and manganese extraction. The Soviet Union did not prioritize lithium extraction in Ukraine, and modern Ukraine has not fully exploited these natural resources.
In wartime, Ukraine has struggled to keep its critical minerals industry running. Extraction of mineral resources from raw materials is costly, and the price of geological exploration can be astronomical.
Lithium production is particularly difficult, relying on foreign investment, The industry has all but stopped over the past three years. When a company obtains a mining license, it takes 10-15 years to start production. In 2017, UkrLithiumMining bought a permit from the state, which means the company is preparing to begin production in 2028-2029, provided the war is over, said Denis Alyoshin, Director of Strategic Development at UkrLithiumMining.
Ukraine retains control over vast quantities of critical mineral deposits. For example central regions of Zhytomyr and Kirovohrad have large reserves of titanium, uranium, graphite, and beryllium.
But Ukraine has historically struggled to take advantage of its rich minerals, partly thanks to being too secretive about them. In 2005, the Security Service of Ukraine issued a resolution to hide data on more than 20 types of minerals classified as critical resources. Due to such policies, Ukraine has not been able to fully attract investors, explained Ksenia Orynchak.
The U.S. is not the only one who has been trying to snatch Ukrainian minerals; Russia started doing it a long time ago. From 2014, as it occupied eastern Ukraine, the Russians began exploiting Ukraine’s coal mines, and reserves of methane gas (liquefied natural gas), selling the products abroad.
Russia is allegedly ready to offer the United States rights to mineral deposits located in the temporarily occupied Ukrainian territories as part of a possible peace agreement, according to The Wall Street Journal. Limiting Russian natural gas exports to Europe would also strengthen the position of American liquefied natural gas in the European market.
This has also allowed Russia to accumulate resources and fund its army over the years. From 2022 to 2024, Russia officially registered the territories and fields it had captured.
“It is essential to understand that we shouldn't underestimate Russia and recognize that, like Ukraine, it has strong geology and engineering scientists,” Orynchak said.
Recent journalistic investigations indicate that over ten Chinese private companies intend to establish joint production for mining and producing building materials with Russia in the occupied territories. This will aid Russia in rebuilding occupied cities and constructing a road for military equipment heading to the frontline.
The full-scale invasion changed everything for Lidiia. About a month beforehand, the Russians began bombing frontline areas. Lidiia recalls that it was terrifying, and that many people started leaving for other cities.
On February 24, as Russia invaded, a signal at the Toshkivska mine announced an immediate evacuation. That same day, Lidiia and her godson decided to leave the village. There was no time to pack much, because it was very dangerous. The journey to western Ukraine took about three days, and the route passed through Kharkiv, where there were many explosions.
Lidiia speaks with pain about the realization that the Russians are now using Ukrainian mines. Most of her life has been devoted to this work, and the understanding of losing her home and her job makes her feel dejected.
Currently, Lidiia and her husband reside in the Dnipro region, in central Ukraine. There, she has established a headquarters for weaving camouflage nets for the military.
“When we left our home… I didn't think we were leaving forever. I want peace in Ukraine and the extractive industry to recover and develop. However, I am not sure Ukraine will receive the necessary guarantees after Donald Trump's recent statements,” Lidiia told The Counteroffensive.
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NEWS OF THE DAY:
Good morning to readers; Kyiv remains in Ukrainian hands.
TRUMP TO CONSIDER CANCELING AID TO UKRAINE: The U.S. president will discuss on Monday the possible suspension or complete cancellation of military aid to Ukraine. This also concerns weaponry paid for during the Biden administration.
According to The New York Times, Trump will meet with his advisers, including Secretary of State Marco Rubio and Defense Secretary Pete Hegseth, to consider policy options regarding Ukraine.
MOSCOW WELCOMES TRUMP POLICY: The Kremlin stated that the Trump administration’s foreign policy “largely coincides” with Russia’s vision. After the conflict in the Oval Office, where Trump criticized Zelensky for his unwillingness to compromise with Putin, Russia perceived this as a “gift.” The Kremlin does not expect a quick lifting of sanctions or an end to the war. On the contrary, the Russian military is preparing for continued fighting.
MACRON, STARMER PROPOSE A ONE-MONTH TRUCE IN UKRAINE: French President Macron stated that he and British PM Starmer are proposing a one-month truce in Ukraine. This plan includes a cessation of hostilities in the air, at sea, and with regards to energy infrastructure. According to Macron, this would be the first stage before the possible deployment of European troops to ensure peace, but this will not happen in the near future. This month is needed to reach negotiations.
ZELENSKYY READY TO MEET WITH TRUMP AGAIN: Zelenskyy said he is ready to meet with Trump if he invites him for a constructive dialogue. He said this to British journalists, responding in Ukrainian through a translator. The president of Ukraine emphasized that the dispute in the White House did not bring positive results and should be "left in history." He is ready to travel to Washington again, as the U.S. is a key partner of Ukraine.
Zelenskyy confirmed Ukraine's readiness to sign an agreement with the U.S. on mineral resources, but for him, it is important that Ukraine's position is heard on the international stage.
DOG OF WAR:
This is Betty, she is three months old. Her name comes from the word ‘bat’ because she is as big-eared as a bat.
Stay safe out there.
Best,
Tim
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There is no justifiable reason for the USA government to be acting like this. That minerals agreement was unjustified. I would happily send yet another letter to my federal legislators except they seem to have turned into mute mannequins who are simply on display and exercise no particular agency of their own.
You are great journalists. I know nothing about rare earth minerals or the mining industry, but this piece focusing on the effect on one person helped me understand better what is going on.