At the 90-year-old Zavallivsky graphite mine in central Ukraine, CEO Ostap Kostyuk envisions producing graphite pure enough for lithium batteries—a task he compares to building a Rolls-Royce in a garage due to chronic underinvestment.
With U.S. President Donald Trump pushing for a major deal on Ukraine’s rare earths and critical minerals in exchange for continued Washington support, operators like Kostyuk see an opportunity. However, they acknowledge that profits will take time for any American investors.
“It’s a long-term investment,” said Kostyuk, as he led a Reuters team through the sprawling Kirovohrad facility, where aging Soviet-era machinery still runs amid a fine layer of graphite dust.
As part of a strategic proposal to Trump, Ukrainian President Volodymyr Zelenskiy highlighted a map of Ukraine’s mineral wealth, including lithium, graphite, titanium, and rare earths—critical for high-performance magnets, electric motors, and consumer electronics. He emphasized that less than 20% of these resources were under Russian control, stressing the need to safeguard the rest.
Despite trillions of dollars in untapped mineral wealth, experts warn that it could take years for investors to see significant returns due to war-related disruptions and chronic underfunding. Ksenia Orynchak, head of Kyiv’s National Extractive Industries Association, noted that Ukraine’s mining sector has faced a decade of stagnationdue to a lack of financial inflows and outdated mineral classification systems.
The Zavallivsky mine, last modernized in 1965, illustrates the scale of the challenge. Despite being far from the front lines, it has struggled since Russia’s 2022 invasion caused an Australian partner to withdraw financing. Many of Kostyuk’s workers have also either joined the military or lost their lives in the war.
Still, the facility is already producing graphite pure enough to be refined into battery-grade spherical graphite (SPG). Ukraine holds 20% of the world’s graphite reserves, a crucial component for electric vehicle batteries and nuclear reactors. While new mining projects could take five to seven years to become operational, Kostyuk remains optimistic.
“We are ready for this technology,” he said, adding that his goal is to eventually produce SPG in-house. In the meantime, Ukraine is prepared to supply U.S. markets with natural flake graphite, establishing a Ukrainian presence in the global supply chain.
“Our factory needs upgrades, but our workforce has the expertise to advance if given the resources,” Kostyuk said. “I believe in this factory. I believe in these people. Everyone here wants to work.”
