What’s in mineral resources deal? Early analysis

Changes related to the agreement will need to be made to national legislation—including tax, budget, subsoil use, and licensing laws.

• The agreement must not contradict Ukraine’s EU integration commitments.
• Contributions: Ukraine’s contribution consists solely of future rights to income from the sale of extraction licenses. The U.S. contribution is the value of potential military aid “in any form (including the transfer of weapons systems, ammunition, technologies, or training).” This is specified in Section 6, Clause 5 of the agreement.
• U.S. interest: Every new license or special permit for resource extraction issued after the agreement is signed must include a requirement for the license holder to sell the extracted resources to Americans at market prices.
• Fund structure: 50% of all licensing fees and similar payments from issuing new licenses or special permits for the minerals listed in the agreement (rare earth metals, oil, gas, etc.). This list is not exhaustive and can be expanded by mutual agreement between Ukraine and the U.S.

Conclusions

1. Signing the agreement demonstrated Ukraine’s constructive approach in its relationship with the U.S. Ukraine is accommodating the demands of the Trump administration—unlike Russia, which ignores American interests and maintains a non-constructive stance.
2. The U.S. has gained an economic incentive to continue supporting Ukraine: where previously support was based on democratic values, now it is also tied to protecting American economic interests.
3. The agreement contains no security guarantees. Most likely, the fund agreement format was not intended to include them. However, it’s reasonable to assume that limiting the scope of the agreement in this way was a deliberate U.S. position. Ukraine has repeatedly stated that security guarantees are key to signing any agreements.
4. The provisions on military aid are vague; therefore, such aid is not guaranteed by this agreement. Still, it provides at least some legal framework for potential future arms deliveries.

Source

About the author. Mykola Kniazhytskyi, journalist, Member of the Ukrainian Parliament.

The editors do not always share the opinions expressed by the authors of blogs or columns.