Ukraine's Mineral Deal with the U.S.: A Step Forward or Just a Temporary Fix?

Ukraine’s government is set to approve a deal with the United States to jointly develop its mineral resources, after a fraught period of negotiations. The deal, expected to be signed by Donald Trump and Volodymyr Zelensky during their meeting in Washington, DC, on February 28, marks a crucial step in easing tensions between the two leaders. Trump will likely frame the agreement as a personal triumph, though the actual terms remain somewhat unclear.

The document ready for Trump’s signature is a framework agreement—the first step in a two-phase arrangement. Much of the finer detail will be hammered out in future discussions. However, the deal represents a shift away from the more aggressive American demands initially put forward, evolving into something resembling a joint investment venture. This deal appears to fall well short of Trump’s earlier $500 billion “payback” demand from Ukraine—a sum he claimed was owed for past military and financial support. Independent assessments have put the actual value of this assistance closer to $120 billion.

The draft agreement notably omits the most controversial U.S. demands, many of which were delivered in a confrontational manner. Ukrainian officials described some moments of the negotiation as intense, with one instance where they were given just six minutes to sign a document. The new framework, however, commits both sides to creating a joint investment fund for Ukraine’s future resource projects.

Ukraine will contribute 50% of the revenue generated from government-owned ventures in sectors like minerals, oil, gas, and infrastructure (including LNG terminals and ports) to this fund. Crucially, this will not apply to existing operations, such as the major oil and gas projects already contributing substantial sums to Ukraine’s budget.

The $500 billion bill that Trump had initially proposed is nowhere to be found in the draft, and the U.S. demand for 100% control over the investment fund has been dropped. Instead, the fund’s ownership will be proportional to the amounts invested by both parties, signaling a more balanced relationship. A contentious clause that required Ukraine to contribute twice the amount of any future aid into the fund—something Zelensky had described as a debt on “ten generations of Ukrainians”—has also been eliminated.

That said, several aspects of the agreement remain unclear. Most notably, the extent of U.S. control over the new fund is not defined, and questions remain about its governance. One provision states that the U.S. will control “the maximum amount” allowable under its laws, which may contradict the idea of proportional ownership.

The eventual, more comprehensive agreement is expected to clarify these governance issues, along with the security guarantees Zelensky had sought as a condition for offering up Ukraine’s mineral resources back in September. The current framework document mentions only "protecting mutual investments," but it alludes to broader security arrangements under the preamble’s reference to an “architecture of agreements.”

Sources familiar with the negotiations indicate that Zelensky will not sign any subsequent, full agreement without securing stronger security guarantees. While the framework does not require parliamentary ratification, any future agreement will.

After two weeks of intense pressure from Trump’s envoys, Ukraine may feel it has successfully weathered a challenging negotiation. The framework deal is still vague and largely conceptual, with many key details still to be worked out. The full scope of Ukraine’s mineral wealth remains uncertain—much of it is either located in Russian-occupied territory or is deep underground, with concentrations too low to be easily extracted. Furthermore, 40% of the mineral resources are in areas under Russian control.

The agreement also provides little information about processing and refining operations, which could be where the real value lies. Despite these gaps, the deal marks a step forward. By agreeing on a framework, Ukraine has provided Trump with a tangible outcome, de-escalated tensions, and gained valuable time to address remaining uncertainties. In the complex geopolitical environment in which Ukraine now finds itself, that in itself is a significant achievement.