On April 30, 2025, the United States and Ukraine signed what officials are calling a “historic partnership” to jointly develop Ukraine’s natural resources, including rare earth minerals, oil, gas, and critical infrastructure. The agreement, unveiled publicly on May 1, is intended to solidify long-term economic cooperation between the two countries and give the United States a direct stake in Ukraine’s postwar recovery.
This new deal comes at a time when the global demand for rare earth elements is soaring, and access to reliable sources has become a strategic priority. As the United States attempts to reduce its dependence on China for these vital materials, Ukraine’s untapped mineral wealth offers a potential solution. The agreement may also represent the first economic step toward ending the war with Russia by tying Ukraine’s future to Western investment and protection.
What the Agreement Includes
The deal goes far beyond rare earth minerals. It creates a joint investment structure that will oversee the development of all new natural resource projects in Ukraine. This includes everything from rare earths to oil, natural gas, and the construction of infrastructure needed to support extraction and processing.
“This is not just rare earths [or] critical minerals … but it will also include oil and gas and critically, natural resources-related infrastructure to capture the full value chain associated with Ukraine’s economic development,” a U.S. Treasury official said during a press call on May 1.
At the heart of the agreement is an investment fund that will be jointly owned and operated by the U.S. and Ukraine. The fund will receive royalties, license fees, and revenues from resource development and reinvest them into additional projects. It will be managed by a company governed by a six-member board, with three representatives from each country.
What the U.S. Gets
For the United States, this agreement provides both financial benefits and geopolitical leverage. The U.S. will not only share in the profits generated by Ukraine’s mineral development, it will also get first access to purchase these resources or designate a preferred buyer. This effectively gives Washington control over where these strategic materials go, helping block adversaries such as China or Russia from gaining influence over Ukrainian resources.
A fact sheet shared by the White House states, “If the United States decides to acquire these resources for ourselves, we will be given first choice to either acquire them or designate the purchaser of our choice.”
Additionally, the U.S. will have the power to exclude bad actors from participating in Ukraine’s recovery. “No state, company, or person who financed or supplied the Russian war machine will be allowed to benefit from the reconstruction of Ukraine,” the fact sheet says.
Retired U.S. Army Lt. Col. Tony Shaffer told Newsmax that the deal gives the United States “skin in the game” and represents a shift in how Washington engages with Ukraine. “The issue becomes production facilities,” Shaffer explained. “Someone is going to have to process those things. So yeah, we could mine them. It’s going to take between five to 10 years before we’re going to see any real output. But the question goes, where do they go right now? China has all the processing capacity.”
What Ukraine Gains
For Ukraine, the deal offers something more valuable than money—it offers long-term security and the foundation for economic independence. The war with Russia has devastated Ukraine’s infrastructure and economy. With this agreement, Ukraine gains a powerful ally willing to invest in rebuilding and extracting value from its land.
“The idea [is] that the money that comes into the fund is going to be reinvested to increase the value for the owners of the fund, the United States and Ukraine, and generate long-term returns for both the American and Ukrainian people,” a Treasury official explained.
The Ukrainian government claims that the country holds some of the largest reserves of titanium and uranium in Europe, along with rare earth elements like tantalum, niobium, and lithium. Much of this potential remains unexplored, but the partnership could jumpstart development.
However, there are challenges. About 20 percent of Ukraine’s mineral resources are located in areas currently occupied by Russian forces. And experts have warned that while Ukraine has promising discoveries, there is little verified data to confirm the size or value of these deposits.
Jack Lifton, co-founder of Technology Metals Research, said, “We have discoveries all over the place, but very few of them ever make it to the status of deposit.” He pointed out that commercial mining is expensive and slow. “To dig a hole in the ground is very expensive,” he said, estimating that it takes about half a billion dollars to bring a mine online.
Could This Help End the War?
While the agreement is primarily economic, U.S. officials believe it could play a strategic role in ending the war. By tying U.S. interests to Ukraine’s long-term development, Washington is signaling that it will not abandon Ukraine, regardless of how long the war lasts.
“This partnership is going to be fundamental to the peace process that the president is leading,” said a Treasury official, “because it sends a strong message to Russia that the United States is in the game and is committed to Ukraine’s long-term success.”
John Mills, former director of policy at the Department of Defense, agreed. He told Newsmax that “the deal puts in place areas of negotiations to end the war,” even though difficult issues like Crimea remain unresolved. “Yes, geographically it was Ukraine,” he said, “however, Ukraine allowed a pretty significant Russian footprint of military bases, housing enclaves, etc. So I think negotiations on trading off territory is absolutely in the works and will probably happen.”
What Critics Are Saying
Some experts are skeptical of the deal’s long-term value. Javier Blas, a commodities analyst with Bloomberg, questioned the idea that Ukraine could become a global rare earth powerhouse. He noted that even if Ukraine were to produce 20 percent of the world’s rare earths—a massive leap—it would only be worth about $3 billion a year.
“To reach the $500 billion mooted by Trump, the United States would need to secure 150-plus years of Ukrainian output,” Blas said.
Others have pointed out that Ukraine is relying on decades-old Soviet geological surveys. A report by S&P Global stated, “No sources contacted by Commodity Insights were aware of any commercial exploration or assessment of those deposits in the post-Soviet period.”
Morgan Bazilian, director of the Payne Institute for Public Policy at the Colorado School of Mines, called the deal “a fantasy,” and compared it to similar claims about mineral wealth in Afghanistan that never panned out.
Environmental groups also warn that large-scale mining projects often lead to pollution and waste. In China, rare earth mining has contaminated rivers and soil. Similar risks could emerge in Ukraine if extraction is rushed without safeguards.
A Model for the Future?
Despite these criticisms, U.S. officials believe the agreement represents a new model for global economic cooperation. Unlike previous foreign aid efforts, this deal is built on mutual investment, shared profits, and long-term accountability.
“This will fundamentally change the mold for international financial agreements,” a Treasury official said. “It could be a model for international economic agreements moving forward.”
Whether the promise of mineral wealth can deliver peace and prosperity remains to be seen, but for now, both the United States and Ukraine are betting that the ground beneath Ukraine may hold the key to a stronger future.
FAM Editor: This is a pretty amazing deal, but at a surface level seems a bit callous. Trump is taking resources in exchange for security, Russia is threatening Ukraines security and taking its land, Ukraine must choose between bad options (would they make this deal without the war?) – and Ukraine doesn’t even get their land back. But then again, this is not Trump’s war, and the structure is clever enough that it just might work, and keep Ukraine secure against additional losses. Who would’ve thought?
