Subsoil deal: former Ambassador to the US Chaly suggests alternative terms
28 March 2025 11:35
OPINION
As early as next week, Ukraine and the United States may sign an agreement on economic partnership in the field of mining, US Treasury Secretary Scott Bessent said. According to him, the American side has prepared an expanded version of the agreement, which it has offered to Ukraine. The previous one, he said, was only four pages long. However, the minister did not specify how many pages the current version is on.
Meanwhile, in Ukraine, these reports provoked another strong reaction, not least because of a post by MP Yaroslav Zheleznyak, who said he had seen the text of the agreement and was horrified by it.
The MP described in detail the key points of the draft that are alarming:
Yaroslav Zheleznyak, MP
- Management by 5 people, 3 of them from the United States with full veto power.
- We are already talking about all minerals. That is, there is oil and gas, both new and existing.
- All over the territory of Ukraine.
- We are talking about production by both state and private companies.
- The money is converted immediately into foreign currency.
- The fund’s money is withdrawn abroad. If for some reason something is not received on our part, we pay extra.
- The U.S. contribution is the assistance we have already received since 2022. And they can make a profit at their own discretion. And they receive the first (and then Ukraine) 4% of the “royalties” from the Fund.
- The agreement is valid indefinitely. It can be changed or terminated only with the permission of the Americans.
- “First night” rights for all new infrastructure projects and the right to veto the sale of resources to other countries.
- Nothing about security guarantees. Not even a hint.
Meanwhile, the government assures that the agreementdoes not provide for the transfer of subsoil use rights or any property rights.
According to Olha Stefanishyna, Vice Prime Minister for European and Euro-Atlantic Integration, the framework agreement between Ukraine and the United States is not an international treaty in the classical sense, but rather a political agreement that defines the intentions of the parties to create a joint Investment Recovery Fund.
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Chaly’s proposal: resources from the occupied lands, previous aid not debt
Ukraine’s former Ambassador to the United States Valeriy Chaly expressed his opinion on the possible deal. He believes that it can be concluded, but only under the following conditions:
Valeriy Chaly, former Ambassador of Ukraine to the United States
- First of all, the resources that can be extracted in the temporarily occupied territories are considered. Accordingly, with the de-occupation of Ukrainian lands, production and revenues will increase.
- The United States pledges to continue to recognize the Russian Federation as an aggressor and not to cooperate in any way with individuals and entities that plunder Ukrainian property, including critical minerals, on the illegally annexed and temporarily occupied territory of Ukraine within the internationally recognized borders of Ukraine. Instead, we should impose sanctions on them.
- No financial resources that came from the United States to Ukraine before the Agreement entered into force can be considered as debts of Ukraine.
- The preparation and conclusion of the Agreement is being carried out at all stages in accordance with the Constitution and laws of Ukraine, in particular, the Law on International Treaties of Ukraine.
- According to the Law “On International Treaties of Ukraine”, this international treaty is concluded by the President of Ukraine (Article 3(1)) on behalf of Ukraine (Article 3(g)) and submitted to the Verkhovna Rada of Ukraine for ratification. Consideration of the issue by the Parliament of Ukraine takes place in accordance with the laws and regulations of Ukraine, in compliance with all necessary procedures and with maximum transparency for the society.
As you can see, these conditions are fundamentally different from what Zheleznyak wrote about.
Chaly also added that the benefits that the United States gets from this agreement must be balanced by security guarantees for Ukraine. And the Ukrainian government should announce the “red lines” so that society knows how it is going to dispose of the resources that belong to the Ukrainian people.
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