MINEX Forum

Tag: reconstruction fund

  • US-Ukraine Investment Agreement Faces Long Road to Mining and Energy Sector Boost

    US-Ukraine Investment Agreement Faces Long Road to Mining and Energy Sector Boost

    The recently ratified investment agreement between Ukraine and the United States, championed by US President Donald Trump, is not anticipated to deliver tangible results for at least a decade, experts told the Financial Times.

    The agreement, approved by Ukraine’s parliament on May 8, outlines the establishment of a joint “reconstruction investment fund” to support future mining and energy projects. Despite optimism, industry leaders warn that substantial challenges lie ahead, including Russia’s ongoing war on Ukraine, heavily damaged infrastructure, restricted Soviet-era geological data, corruption risks, and unexploded ordnance contamination.

    According to Eric Rasmussen, former head of natural resources at the European Bank for Reconstruction and Development, “It could be 10-15 years — that’s the sort of timeline we talk about.” Peter Bryant of the advisory group Clareo echoed these sentiments, stating that the deal “does little to de-risk the supply chain in the next 10 years.”

    Ukraine boasts significant natural resources, including iron ore, coal, lithium, graphite, and titanium-bearing ores. It is also Europe’s third-largest gas producer. While oil and gas fields may be quicker to develop, mining projects are expected to face lengthy geological exploration before reaching feasibility.

    Ukrainian Minister Yulia Svyrydenko mentioned that the reconstruction fund would be operational “within a few weeks,” although profits are expected to be reinvested for the first decade.

    US-backed TechMet, which aims to secure Ukrainian lithium, called the agreement promising but noted the long-term commitment required. DTEK, Ukraine’s largest private energy firm, expressed optimism, signaling that Ukraine was “open for business.”

    However, not all are convinced. One mining executive remarked skeptically, “This romantic idea that there’s lakes of lithium to be tapped is just not the case.”

  • Ukraine and U.S. Sign Landmark Minerals Agreement to Launch Joint Reconstruction Fund

    Ukraine and U.S. Sign Landmark Minerals Agreement to Launch Joint Reconstruction Fund

    On April 30, Ukraine and the United States signed a pivotal minerals agreement establishing a joint “Reconstruction Investment Fund” aimed at supporting Ukraine’s economic recovery and long-term development. The deal was signed in Washington by Ukraine’s First Deputy Prime Minister Yulia Svyrydenko and U.S. Treasury Secretary Scott Bessent, following months of complex negotiations.

    “This document ensures success for both our countries,” said Svyrydenko, emphasizing that the fund marks a strategic investment partnership without compromising Ukraine’s sovereignty over its subsoil, infrastructure, or state-owned enterprises.

    The agreement creates a jointly managed fund to which both countries will contribute, using proceeds from newly issued licenses for critical minerals and oil and gas projects. It explicitly excludes revenue from existing projects and does not impose any debt obligations. Additionally, neither Ukraine nor the U.S. will tax the fund’s income or contributions.

    Bessent highlighted the deal as a sign of lasting U.S. support, stating, “This agreement signals clearly to Russia that the Trump Administration is committed to a peace process centered on a free, sovereign, and prosperous Ukraine.”

    While the deal offers no direct security guarantees, it outlines a long-term strategic alignment and commits the U.S. to help attract further investment and technological support for Ukraine. Importantly, it includes safeguards to prevent individuals or entities linked to Russia’s war machine from benefiting.

    Ukrainian Prime Minister Denys Shmyhal praised the agreement, noting it would help drive reconstruction, economic growth, and technology transfer. He confirmed that the deal must now be ratified by Ukraine’s parliament, the Verkhovna Rada.

    Despite last-minute tensions reported by the Financial Times, the agreement was finalized, setting the stage for a new phase of U.S.-Ukrainian economic cooperation.