The US-Ukraine Subsoil Agreement: Economic Partnership or Geopolitical Bet?
8 May 20:10
ANALYSIS FROM 
The Verkhovna Rada has ratified the agreement between Ukraine and the United States on joint mining, the last step before it enters into force. This important agreement, which has already received the status of a historic one, was supported by 338 MPs out of 226 required. In fact, it was supported by all factions and groups of the parliament, including the opposition, which had some critical comments.
To implement the agreement between Ukraine and the United States, two more technical documents remain to be signed, the drafts of which remain confidential and even MPs have not seen them. The opposition considered the absence of these documents, as well as the lack of security guarantees from the United States, to be the main obstacles to supporting ratification.
The agreement was signed on April 30 between First Vice Prime Minister Yulia Svyrydenko and U.S. Treasury Secretary Scott Bessant. The official title of the agreement is “Agreement between the Governments of Ukraine and the United States on the Establishment of the U.S.-Ukraine Reconstruction Investment Fund.”
Scott Bessent characterized the agreement as “historic,” noting that it would help “accelerate Ukraine’s economic recovery.” He emphasized that economic security is part of national security, and added that the agreement sends a clear message to Russia about the Trump administration’s commitment to a peace process focused on a free, sovereign, and prosperous Ukraine in the long term.
Ukrainian MP Yuriy Kamelchuk exclusively for [Kommersant] noted that the agreement on the establishment of a joint investment fund between Ukraine and the United States is truly unprecedented, as there have been no such examples in relations between the two countries before:
“This agreement is historic because no investment fund has ever been created between the US and Ukraine before. It can be a signal to other investors that it is possible and worthwhile to work with Ukraine. And most importantly, the agreement is valid throughout Ukraine within the 1991 borders. The more investments and weapons we have, the easier it will be for us to return the temporarily occupied territories,” says the MP.
As a reminder, the idea of joint production and distribution of revenues from Ukrainian natural resources was first announced by President Volodymyr Zelenskyy in the fall of 2024.
The agreement was to be signed several times. The first version of the document was handed over to Ukraine back in February, and after being finalized and a compromise was reached, it was to be signed during Zelenskyy’s visit to Washington. However, due to the conflict between the presidents, the process was disrupted, and the United States significantly tightened its demands on Ukraine, offering Kyiv a version of the agreement that became unacceptable.
Nevertheless, the parties managed to resume negotiations and find common ground for a compromise. First, Yulia Svyrydenko signed the framework document online, after which work began on finalizing the main agreement.
For Ukraine, it was important that the agreement did not count the aid already provided by the United States as a debt.
Details of the agreement
The agreement stipulates that Ukraine retains full control and ownership of its natural resources. As Yulia Svyrydenko noted, “subsoil remains in Ukrainian ownership – this is enshrined in the agreement.”
The investment fund will be established on a 50-50 basis. It will be jointly managed by representatives of Ukraine and the United States, with neither party having a voting advantage.
The document does not change the process of privatization or management of state-owned enterprises – companies such as Ukrnafta or Energoatom remain in state ownership. Also, the agreement does not provide for any debt obligations of Ukraine to the United States.
The agreement does not violate Ukraine’s international obligations, including those related to European integration. The fund will be filled with revenues from new resource licenses, namely 50% of licenses for projects related to critical materials, oil and gas. Revenues from projects already started or planned will not be included in the fund.
The fund will be supported by the US government through the DFC agency (the Corporation for International Development), which will help Ukraine attract investment and technology from companies and foundations from the US, the EU, and other countries.
The Fund’s contributions and income will not be taxed in Ukraine or the United States. For its functioning, it will also be necessary to amend the budget code of Ukraine.
The agreement is open-ended and can only be terminated by agreement of both parties.
Yulia Svyrydenko explained that the United States can make contributions to the Fund in the form of new military aid, for example, by transferring air defense systems to Ukraine.
Ukraine contributes 50% of the state budget revenues from new royalties for licenses for new fields. In addition to this basic contribution, the country may make additional contributions if deemed necessary.
The Fund will invest in projects related to the extraction of minerals, oil and gas, as well as related infrastructure and processing. Specific investment areas will be determined jointly by Ukraine and the United States. According to Svyrydenko, the fund will invest only in Ukraine.
“We expect that in the first 10 years, the fund’s profits and revenues will not be distributed, but will be used exclusively for investments in Ukraine – for new projects or rehabilitation. These conditions will be specified later,” she said.
MP from the Servant of the People party Georgiy Mazurashu talking to journalists [Kommersant] noted that the significance of the agreement will depend on its practical implementation, but it is already a positive signal for the country:
“This agreement has a chance to become historic if it really helps to rebuild the country, attract investment and bring the end of the war closer. For now, it is only a chance – everything depends on further actions on both sides. In the current circumstances, this is a very encouraging step,” says the MP.
Benefits and potential risks of the agreement
The text of the agreement signed by representatives of the United States and Ukraine was published on the website of the Verkhovna Rada. Experts note that Ukraine has managed to achieve fairly acceptable terms, especially compared to what the White House initially proposed during the negotiations.
However, the agreement does not contain any mention of security guarantees, which has long been an important demand of the Ukrainian side. In addition, some of the agreements, including those on fund management, profit distribution, and selection of investment projects, remain confidential.
It was the lack of access to these additional documents that was the main criticism of the opposition on the eve of the agreement’s ratification. Taras Kachka, Deputy Minister of Economy, told Ekonomichna Pravda that most of the details would be defined in the limited partnership agreement and the fund’s charter. These documents have not been made public, but, according to Kachka, most of the fundamental issues have already been agreed upon between Ukraine and the United States.
The limited partnership agreement will be signed by DFC and the Ukrainian Agency for Public-Private Partnership Support. This document will define the basic principles of the fund, including who will manage it. According to public statements by government officials, the fund will be managed on a parity basis – 50% each for Ukraine and the United States.
At the same time, Dzerkalo Tyzhnia reports that although the fund’s board will consist of three US and three Ukrainian representatives, specialized committees will be dominated by Americans. For example, the investment and administrative committees will have three representatives from the United States and two from Ukraine, the audit committee will have two from each side, and the project search committee will have two from the United States and three from Ukraine.
The publication also notes that the Limited Partnership Agreement provides for the possibility of Ukrainian representatives losing their voting rights in the fund’s board and committees if Ukraine violates the terms of the agreement with the United States.
Taras Kachka, who was actively involved in the negotiations, said in a commentary to the EP that the issue of the distribution of US and Ukrainian representatives in the fund’s committees is still being discussed and is not finalized.
Assessing the new agreement between Ukraine and the United States, MP Yaroslav Yurchyshyn emphasizes that its true meaning will become clear only with time, but it already opens up important opportunities:
“Time will tell whether the agreement will become historic. But it is already important as a signal of the return of US interest in Ukraine, an opportunity to attract investors, and a way for Trump to supply us with weapons, presenting it as an investment in the future,” says Yurchyshyn.
In the next 10 years, the joint fund will focus exclusively on investing in Ukrainian projects, the Ukrainian government assures.
“The Fund will invest in Ukraine, in particular in projects related to critical materials, oil, gas, and infrastructure,” Yulia Svyrydenko said in an interview with RBC-Ukraine.
Such projects may include the development of ports, terminals, and gas infrastructure. According to the minister, there is already a list of projects in the field of critical materials that can bring the first profit in the short term. The Fund itself will decide where to invest.
The State Audit Service will audit the Fund’s activities from the Ukrainian side.
Svyrydenko also denied speculation that the United States might be interested in Ukraine’s nuclear power plants or gas transportation system as part of the deal. She also explained how the agreement mechanism would work in practice.
If a Ukrainian company wants to engage in mining, for example, lithium, but does not have enough funding, it can apply to this Fund. The Fund will assess whether it is interested in the project or find another company, such as an American company, that will be ready to invest,” Svyrydenko explained.
At the same time, the company has the opportunity to negotiate with other investors, but within six months it cannot offer them better conditions than those provided to the Fund.
The minister emphasized that the activities of the Ukrainian-American Fund will not be subject to political influence.
