Investments in Ukraine’s Subsoil: Key Challenges for Foreign Investors

The investment agreement between Ukraine and the USA regarding the exploration of Ukrainian subsoil covers a wide range of minerals, including oil, gas, and metals. However, experts emphasize that expecting quick profits is unrealistic, as most promising deposits require further study, and a significant portion of them is located in temporarily occupied territories.

This is reported by AgroReview

Unexplored Potential and Territorial Challenges

One of the most significant rare earth element deposits is the Novopoltavske, which has not been explored since Soviet times and is located in close proximity to the combat zone. A similar situation is observed with lithium deposits. According to experts, approximately 40% of Ukraine’s metal reserves are currently controlled by Russia. In the context of ongoing hostilities, assessing the full economic potential of these resources, as well as the prospects for investors, is a challenging task.

Infrastructure and Technological Barriers

Due to the war, most enterprises that could ensure the extraction or processing of minerals are either not operational or are not covered by the investment agreement at all. Ukraine needs to create new production infrastructure, which will serve as a foundation for the development of the extraction and processing industry.

Another significant challenge is the further processing of minerals to a state suitable for industrial use. For example, the purification of rare earth elements is a complex technological process predominantly handled by China worldwide. Additionally, uranium requires enrichment, and titanium ore must be refined to a quality suitable for aviation needs.

Another risk factor for investors is Russia’s dominance in the global market for titanium and uranium processing.

In 2023, it accounted for over 25% of the enriched uranium used in the USA.