Ukraine is close to signing an agreement regarding mineral resources, a demand from the USA in exchange for military aid to our country. This involves rare earth metals and other valuable natural resources. This information was reported by Kontrakty.UA.
Why is there such interest from the USA in Ukraine's subsoil, what quantity of rare earth metals do we possess, for what purposes are they needed, and which deposits have already been seized by Russia? All of this was discussed by TSN.ua with Stella Shekhunova, director of the Institute of Geological Sciences of the NAS of Ukraine, academician of the NAS of Ukraine, and doctor of geological sciences. The value of mineral resources can be astronomical.
– In the initial version of the agreement proposed by the Americans, it was stated that Ukraine should provide access to mineral resources worth $500 billion in exchange for military assistance. Now, the billions have been removed from the agreement. But I’m curious to hear your opinion, could we be giving away our natural resources too cheaply?
– Honestly, I have not seen the final text of the agreement, so I won’t take on the responsibility of making assessments and am not ready to "take the bread" from economists and determine the price of our mineral resources. However, I want to note that prices are constantly changing and depend on many factors. Seven to ten years ago, there were popular examples of stable and rapid price increases for lithium mineral raw materials, driven by the development of the electric vehicle market segment. As we know, lithium-ion batteries are used in electric vehicles, gadgets, and other devices. By the way, the price of batteries remains a key factor in reducing costs for electric cars, as it accounts for 25-40% of their value.
In the past year, 87% of the world's produced lithium was used for their production (according to the US Geological Survey). This indicates that there is a demand for lithium. And prices promised stable growth.
In 2016, lithium carbonate prices in China surged by 300%, briefly exceeding $20,000 per ton, against the backdrop of a sharp but temporary shortage of imported spodumene from Australia. In the USA, prices increased by 14%, while in the rest of the world, prices rose by approximately 40-60% in the same year compared to 2015 due to a moderate excess of demand over supply for lithium. And the price continues to fluctuate significantly:
- In 2021, lithium carbonate prices in China rose from approximately $7,000 per ton in January to about $26,200 per ton in November.
- Prices for metallic lithium (99.9% lithium) in China increased from about $77,000 per ton in January to approximately $97,000 per ton in July. In 2022, prices continued to rise, followed by a decline.
- In 2023, lithium carbonate prices in China decreased from approximately $76,000 per ton in January to about $23,000 per ton in November.
- In 2024, lithium carbonate prices in China continued to decrease from about $14,500 per ton in January to approximately $9,400 per ton in November.
These price fluctuations pertain to just one type of raw material over a decade. Therefore, the value of Ukrainian mineral resource reserves should be assessed by economists considering the trends in technological development and forecasting future mineral raw material needs.
Funds and Technologies Needed
– In that case, could Ukraine remain just a supplier of raw materials?
– Regarding the transformation of our country into a raw material appendage of technologically developed countries, such a threat exists. Although both the government and professional circles have understood for many years the importance of creating value-added chains based on natural resources, particularly mineral raw materials. However, in reality, we have, unfortunately, numerous negative examples of deindustrialization and the primitivization of the economic sector that utilizes mineral resource materials due to the state losing control over strategic enterprises and the bankruptcy of companies with high-tech technologies.
We had unique production facilities based on mining and processing enterprises. Just a decade ago, Ukraine produced magnesium, hafnium, gallium, scandium, germanium, and others, which are now listed among the critical mineral raw materials of the EU, USA, and other countries due to the monopolization of production by certain nations.
Development and processing of mineral resources require investments and technologies. The state must create attractive conditions for attracting investments to stimulate innovation and the high-tech nature of production.
How Much Rare Earth Element Reserves Does Ukraine Have?
– If the Americans are interested specifically in rare earth metals, what are our approximate reserves?
– Rare earth elements (REE) are a group of 15 elements from the "lanthanide" family in the periodic table of chemical elements, and often yttrium (Y) and sometimes scandium (Sc) are also included. So when we talk about rare earth elements, we are referring to a maximum of 17 elements: light rare earth elements (lanthanum (La), cerium (Ce), praseodymium (Pr), neodymium (Nd), promethium (Pm), samarium (Sm), europium (Eu)) and heavy rare earth elements (gadolinium (Gd), terbium (Tb), dysprosium (Dy), holmium (Ho), erbium (Er), thulium (Tm), ytterbium (Yb), lutetium (Lu), yttrium (Y)).
Ukraine has many prospective geological objects for rare earth mineralization – they could become deposits if their development is deemed economically viable after study.
The majority of these objects are located within the Ukrainian Shield and adjacent geological structures. The State Balance of Mineral Reserves, which is compiled and monitored by the State Geological Service of Ukraine, includes data on three deposits in Donetsk, Zaporizhzhia, and Zhytomyr regions. These deposits are not currently being developed. The ore reserves in them are estimated at over 1.5 billion tons, and the reserves of rare earth metal oxides exceed 2 million tons. These primarily consist of yttrium and yttrium group elements.
A feature of our deposits and prospective objects is the complexity of the ores, meaning they contain several valuable rare or rare earth elements. The useful component/element in the ore can amount to fractions of a percent. Therefore, ore enrichment, i.e., the extraction of valuable components followed by their separation, is a complicated and quite costly process.
Lasers, Permanent Magnets, and Special Glass
– What are rare earth metals used for, what can be manufactured from them? What is their value?
– The properties of rare earth elements are determined, in particular, by their structure. We remember from school that the sizes of ionic radii of elements in the periodic table usually increase with increasing atomic number, but rare earth elements demonstrate a unique reduction in their ionic radii with increasing atomic number, known as lanthanoid contraction. This affects their physicochemical properties, and thus their use and application.
These elements are used as "homeopathic" additives to create materials with unique properties in the fields of electronics, petrochemicals, military affairs, metallurgy, machine engineering, energy, light industry, medicine, environmental protection, and agriculture.
For example, gadolinium is used as a burn-up absorber (absorbs neutrons) in energy reactors, as well as in contrast agents for magnetic resonance imaging. The absorbers include – dysprosium, europium, lutetium, samarium, and erbium.
Rare earth metals are used as alloying additives in steels, and alloys for the production of special glass. Heavy rare earth elements dysprosium (Dy) and terbium (Tb) and light rare earth elements neodymium (Nd) and praseodymium (Pr) have magnetic properties and are important components in the production of high-efficiency permanent magnets. Neodymium-based permanent magnets ("Nd magnets") are lighter and stronger compared to other types of magnets, and products can take various necessary shapes and sizes. They are particularly needed for