Natural resources document: 57 minerals and US military aid to Ukraine

An agreement between the US and Ukrainian governments on establishing the US-Ukraine Reconstruction Investment Fund covers 57 minerals. It also mentions US military assistance to Ukraine, though several issues remain unspecified in the document.

As reported by European Pravda, having seen the document signed in Washington, the bilateral agreement signed in Washington on 30 April sets out the political framework for cooperation between the two governments on:

• the development of critical minerals,
• the sale of these minerals,
• future US assistance to Ukraine, including military aid.

Reports suggest that during the negotiations, Ukraine and the United States opted once again to split the agreement into several components.

However, many details, including politically significant ones, will be outlined in a technical agreement that is not yet ready to be signed.

The agreement signed on Wednesday 30 April is only 12 pages long, whereas the earlier draft handed over by the US in March spanned 90 pages, using the same font size.

The parameters of the signed agreement align with most of the key points made by Ukraine's Prime Minister Denys Shmyhal on Wednesday.

European Pravda notes that the agreement includes explicit guarantees ensuring it does not conflict with Ukraine’s commitments to the EU or its EU accession goals. Should any contradiction with the EU accession process arise, the provisions of the US-Ukraine agreement would need to be revised.

Crucially, the agreement does not place Ukraine under US jurisdiction – disputes are to be resolved on a parity basis through consultations.

The document also does not grant US companies the right of first refusal for licences to extract mineral resources in Ukraine. However, it does guarantee that US companies will have access to auctions or negotiations for such resources on terms no less favourable than those offered to other buyers.

The agreement specifies a list of 57 minerals to be extracted: aluminium, antimony, arsenic, barite, beryllium, bismuth, cerium, caesium, chromium, cobalt, copper, dysprosium, erbium, europium, fluorine, fluorspar, gadolinium, gallium, germanium, gold, graphite, hafnium, holmium, indium, iridium, lanthanum, lithium, lutetium, magnesium, manganese, neodymium, nickel, niobium, palladium, platinum, potassium, praseodymium, rhodium, rubidium, ruthenium, samarium, scandium, tantalum, tellurium, terbium, thulium, tin, titanium, tungsten, uranium, vanadium, ytterbium, yttrium, zinc, zirconium, oil and natural gas.

This applies only to new deposits for which Ukraine will issue licences after the agreement enters into force. The list can be expanded only with the consent of both parties.

The agreement does not regulate production or revenues from the extraction of other minerals. It also excludes revenues from Ukrainian infrastructure, as proposed initially by the United States.

Ukraine will contribute to the joint fund using revenues from the sale of licences and royalties from the extraction of these minerals but retains the right to make additional transfers to the fund.

The US contribution will include, among other things, new arms supplies to the Ukrainian Armed Forces.

The agreement states that if the US government provides Ukraine with new military assistance in any form, including transfers of weapons systems, ammunition, technology or training, the US capital contribution will be considered increased by the estimated value of that assistance.

However, some of the provisions announced by Prime Minister Shmyhal are not included in the signed agreement. For instance, the document does not mention the principles of the fund’s management or the reported US commitment to refrain from withdrawing income from the fund for ten years, instead reinvesting 100% of the proceeds into Ukraine's recovery. These elements are expected to be set out in the subsequent agreement, which is currently being drafted.

Ukraine and the US will ratify the minerals agreement.

After the agreement was signed, Ukraine's First Deputy Prime Minister Yuliia Svyrydenko outlined how the joint investment fund would operate: the US may contribute financially or through new aid such as air defence systems, while Ukraine will invest 50% of state revenues from new mineral licences. Both countries will jointly decide on projects, with fund income reinvested in Ukraine for the first 10 years.