Russia, US discuss potential cooperation on rare earth minerals projects

President Vladimir Putin's investment envoy announced in a statement released on Monday that Russia and the United States have initiated discussions on collaborative rare earth metals and other projects within Russia, with some companies already showing interest, according to a Reuters report.

Despite US President Donald Trump's attempts to mediate an end to the conflict in Ukraine, a proposed minerals cooperation deal between Kyiv and Moscow appears to be faltering. 

President Trump indicated on Sunday that President Zelenskiy of Ukraine is looking to withdraw from the agreement.

US-Russia partnership

In February, Russian President Vladimir Putin proposed a potential collaboration with the US, suggesting joint exploration and development of rare earth metal deposits within Russia's borders. 

This strategic move highlights the significance of rare earth metals, essential components in advanced technologies such as lasers and military equipment, and underscores Russia's substantial reserves, ranking fifth globally.

Putin's proposition reflects a potential shift in the geopolitical landscape, signaling a willingness to engage with America in a mutually beneficial partnership. 

The proposal also carries potential economic benefits for both nations.

For Russia, collaboration could attract foreign investment, technological expertise, and accelerate the development of its rare earth resources. 

The US, on the other hand, could gain greater access to a critical supply of rare earth metals, reducing its dependence on other sources and mitigating potential supply chain disruptions.

However, the proposal's reception in the United States remains uncertain, with potential opposition from those wary of closer ties with Russia and advocates for domestic rare earth production.

Discussions

Discussions have already commenced, according to Kirill Dmitriev, Kremlin special envoy on international economic and investment cooperation, in an interview with the Izvestia newspaper published Monday.

Kirill Dmitriev, CEO of the Russian Direct Investment Fund said:

Some companies have already expressed interest in the projects, according to Dmitriev, who was a member of Russia's negotiating team at discussions with US officials in Saudi Arabia in February. 

He did not provide any further information or identify any of the companies.

Trump expressed anger towards Putin on Sunday and threatened to impose secondary tariffs of 25% to 50% on purchasers of Russian oil if Putin obstructs his attempts to resolve the war in Ukraine.

NBC News reported that Trump was very angry after Putin criticised the credibility of Zelenskiy's leadership last week. 

Trump later expressed his disappointment with Putin to reporters but remained optimistic, stating that progress was being made "step by step."

Russia’s reserves

The rest of the world is trying to develop its own supplies of rare earth metals, due to China's control of 95% of global production and supplies. These metals are essential for industries such as defence and consumer electronics.

While the US Geological Survey estimates Russia's rare earth metal reserves at 3.8 million metric tons, Moscow's estimates are significantly higher.

The Natural Resources Ministry reports that Russia had 28.7 million tons of rare earth metal reserves as of January 1, 2023.

Of that total, 3.8 million tons were either under development or ready for development.

The next round of Russia-US talks, which may occur in mid-April in Saudi Arabia, could include further discussion of the cooperation, Izvestia reported.