Berliner Boersenzeitung - Ukraine titanium mine hopes US deal will bring funds

Despite tensions between Ukraine and the United States, hopes are high that the two countries can strike a minerals deal that would bring much-needed investment.

"Ukraine is very rich in mineral resources and if we do not extract them, Ukraine will simply lose out on revenues that it could have obtained," said Dmytro Golik, head of the mine operator.

Located in the Zhytomyr region in the western part of central Ukraine, the mine contains ilmenite, a titanium-iron oxide mineral which is widely used for pigments.

US President Donald Trump wants a share in revenues from Ukraine's mineral wealth as compensation for the military and financial aid Washington has poured into Ukraine since the start of Russia's invasion more than three years ago.

Ukraine, which has around five percent of global mineral resources, is the 11th biggest titanium producer in the world, according to World Mining Data.

Its mineral reserves could contain around 185 million tonnes of titanium, including as much as 65 million tonnes in the Zhytomyr region alone, Golik said.

- Fraught negotiations -

A Ukraine-US deal on minerals was due to have been signed at the White House last week, but the event was called off after a spectacular televised clash between Trump and Ukrainian President Volodymyr Zelensky.

Even before the meltdown in Washington, negotiations on the document were fraught.

Zelensky rejected several versions, pointing to the risk of plunging "10 generations of Ukrainians" into debt.

Kyiv and Washington finally agreed on a framework agreement for the creation of a joint fund that would handle part of the revenues from Ukrainian mineral extraction.

In the last few days, Ukrainian and US officials have signalled a readiness to sign the agreement soon, but no date has been fixed and terms could change again.

Golik declined to speculate on what the deal could contain and does not know if his mine, which covers 400 hectares and employs 350 people, would be part of it.

But he is adamant that the sector "really needs investment" since Ukrainian companies are not putting money into it.

"Who would these investors be? I think our employees, our people, are less interested in that than in having stable jobs."

- 'Additional protection' -

Golik said a "strong foreign investor" would be "a kind of additional protection for the country" and additional tax revenues would boost the army.

"It would not be just Ukraine's responsibility, it would become the responsibility of Europe or the whole world," he said.

While his mine is not directly affected by Russian strikes, its functioning has been hit by regular power cuts following Russian attacks on Ukraine's energy sector.

He said he hopes investors could be interested not only in exporting ilmenite but in producing the pigments inside Ukraine.

These could then be "easily sold in Europe and elsewhere in the world," Golik said.

Not everyone views Washington favourable given the current political context.

Trump has engineered a stunning rapprochement with Russian President Vladimir Putin and this week suspended all military assistance to Ukraine.

US financial demands have also been seen as predatory by some commentators in Ukraine -- a country ravaged by war.

Sergii, the operator of one of the huge excavators at the mine, said he was following the news with "concern".

"Natural resources are the property of the people," said Sergii, who has worked at the mine for 35 years.

They "must belong to Ukraine," he said.

(A.Lehmann--BBZ)