Ukraine hopes that the agreement will mean significant investments in the Ukrainian rare raw materials, bringing wealth and jobs to Ukraine.
Ukraine has many rare minerals unused in the subsoil, such as lithium used for batteries. With prices for rare minerals soaring in recent years, several countries have expressed interest in the Ukrainian riches, and the European Union seems to be in the lead.
Tuesday, the EU and Ukraine signed a memorandum of understanding about raw materials such as lithium and batteries. According to Reuters, the EU hopes to boost its supply of these rare minerals from Ukraine, which is essential in electronics in renewable energy, defense, automotive, and aerospace.
“Developing cooperation with the EU … is of strategic importance to us and will help integrate mineral supply chains and strengthen strategic resilience during post-pandemic recovery,” the Ukrainian Prime Minister Denys Shmygal.
It is still unclear how much and potentially when the EU will invest in extracting rare minerals in Ukraine and whether there will be production of goods in Ukraine or simply extraction and export of rare raw materials. It is expected that a more concrete deal will be signed at a later stage, which is normal after signing a memorandum of understanding.
According to Reuters, the EU receives 98 percent of their rare raw materials such as bauxite, lithium, titanium, and strontium from China. The EU expects that the EU’s need for lithium will grow 18 times by 2030 and 60 times by 2050.
Ukraine has lots of rare minerals
Ukrainenu has previously written about the great potential for rare minerals in Ukraine, which can grow to large industries. However, the site Mining World points out that the only problem is that Ukraine is not doing anything to extract them and that the country needs investments from outside to reach its potential.
“Ukraine’s subsurface resources include a concentration of around a hundred types of minerals, the market value of which is estimated by experts to reach $7.5 trillion USD. In total, Ukraine’s mineral resource base is formed of 20,000 deposits and ore manifestations, of which 7,800 are explored, and only 3,300 are being developed,” writes Mining World, “Ukraine harbours significant reserves of non-ferrous and rare-earth metals including unique deposits of beryllium, zirconium, tantalum, and a complex of phosphoric rare-earth and rare-metal ores.”
“Ukraine’s confirmed reserves of lithium are the largest in Europe. The country also has a real opportunity to enter the global market with pure and ultra-pure metals such as gallium, indium, thallium, lead, and tin,” the site points out.
World Data Center’s National Atlas of Ukraine also points out that the Ukrainian resources of rare minerals are unique and the largest in Europe.
“Ukraine is a rare-metal province: the recoverable rare-metal resources are the biggest in Europe. The most important is the Ukrainian shield with its 22 rare-metal formations. The most unique and large are such deposits: Perha of beryllium; Azov of zirconium and rare-earth series; Polokhivka, Stankuvate, and Shevchenko of lithium; Mazurivka of tantalum-niobium-zirconium ores,” the site points out.
Can help Ukraine reach its potential
The question is, however, how a future deal between the EU and Ukraine will look like. For example, will Ukraine simply be selling its rare minerals as a raw material, which will then be processed in the EU, or will Ukraine play a role in electronics manufacturing?
Ukrainenu previously spoke to the Managing Director of Banke APS, Rasmus Banke, who expressed hope that Ukraine will get a role in manufacturing.
“The country lacks investments. It is not enough that companies like ours come here or that some companies move production here. The country also needs investments in producing its own products,” said Banke, “Ukraine has large deposits of Lithium, which holds great potential. Still, I fear that foreign companies will simply come here, buy the mines and take the lithium away. Ukraine needs things to be produced here.”
“The sky is the limit in Ukraine,” said Banke, “I like to come to this country, but I also get sad from time to time. There is such great potential here, and the green energy transition just adds another layer, but the country needs investments.”