Donald Trump’s return to the White House opened the way for negotiations with Russia. In previous years, such a possibility had been ruled out, with the Russian government calling for a “pragmatic” approach and blaming their “Western partners” for severing economic and other ties with Russia over the war in Ukraine. From the outset, it was assumed that negotiations with the US would focus less on political issues than on missed opportunities for economic partnership caused by recent political differences. In other words, the future economic prosperity of both countries needed to be discussed and a deal reached quickly. Ending the war in Ukraine was supposed to be on the agenda, but that has not happened yet.

After several months of negotiations, the public remains in the dark about what the delegations and leaders discussed. (Let’s leave aside the fact that the Alaska summit was extremely necessary for Putin to break out of international isolation, meaning all the conversations and comments may, in the end, be of little significance.) Experts are left guessing about potential energy projects, oil field development, the return of US business to Russia, the use of Russian icebreakers in Alaska, the lifting of sanctions and more. One thing that is known is that the talks have touched on the Arctic, which is becoming a sort of “MacGuffin.” In film theory, this term refers to an object, an idea or an event – something that sets the intrigue in motion, with the unfolding plot oftentimes more interesting than the object itself.

The Arctic as an ideal space for infrastructure diplomacy

The idea of a US-Russia Arctic deal fits neatly into what is now termed “infrastructure diplomacy.” This is a practice through which countries with superpower ambitions support and implement large-scale development projects in other states in exchange for something – for example, political support and loyalty, participation in alliances or integration. Infrastructure diplomacy, pursued not only by the US but also by China and Russia, is asymmetrical: one side seeks money and resources, while the other wants recognition of dominance or security guarantees, resulting in economic and political dependency.

Flagship infrastructure projects are used in the diplomatic game to help form geopolitical alliances and expand international influence. They advance regional integration and extend the political presence of global powers. The classic example of this is the US Marshall Plan after World War II. Importantly,infrastructure diplomacy also has an economic motivation. China’s Belt and Road Initiative and Rosatom’s international deals are examples of projects with both diplomatic and economic value.

Since 2022, Russia has been using nuclear energy as a tool of infrastructure diplomacy. Russia is building nuclear power plants in dozens of countries, making them dependent on Russian resources and technology, as well as on large loans.

The Arctic, in fact, is an ideal space for infrastructure diplomacy. This resource-rich region is populated by states with varying levels of infrastructure development. Russia is banking on these resources, and it ties its future to maintaining sovereign control over the Arctic. To do so, it needs people and infrastructure to exploit them. Alongside solving its own infrastructure deficit, Russia seeks to increase its partners’ dependence on its infrastructure. When Mikhail Gorbachev opened the Soviet Arctic to foreign vessels in the late 1980s as part of the Murmansk Initiative, he insisted on a Soviet icebreaker escort. A similar pattern is visible today: the state wants to make its part of the Arctic an essential element of global transport and energy infrastructure, thereby ensuring that the world – or at least a significant part of it – depends on Russia. From there, the Kremlin can deploy infrastructure diplomacy to achieve its objectives. Other major players, including China, India, European countries and, of course, the US, are also fully aware of this. Washington openly asserts that non-Arctic countries, primarily China, have no place in the region.

The primacy of infrastructure diplomacy was clearly demonstrated by the first US-Russia contacts in Saudi Arabia in February. At that time, representatives of the US delegation, led by Secretary of State Marco Rubio, met with Russian Foreign Minister Sergei Lavrov and the head of the Russian Direct Investment Fund (RDIF), Kirill Dmitriev, to discuss the Arctic as a possible area for economic cooperation. Bloomberg reported that the US was considering cooperation on energy exploration.

Dmitriev, Russia’s main economic spokesman, had underscored interest in Arctic infrastructure cooperation even before Putin repeatedly stressed the topic. In March, during a speech in Murmansk, Vladimir Putin said while Russia intends to defend its national interests in the Far North and is concerned about NATO’s intentions in the region, it remains open to economic cooperation with the US. Joint development of Arctic resources, he suggested, could pave the way for a rapid rapprochement.

In August, ahead of the Alaska summit, presidential advisor Yuri Ushakov declared that “the economic interests of our countries intersect in Alaska and the Arctic, and there are prospects for implementing large-scale, mutually beneficial projects.” After the summit, Putin again confirmed that he had discussed with his US interlocutors the possibility of joint mineral extraction in both the Russian Arctic and Alaska. 

A notable feature of the “infrastructure diplomacy” in which the US and Russia are currently engaged is its complete exclusion of environmental and humanitarian aspects, including the rights of indigenous peoples.

Researchers note that with infrastructure diplomacy, informal signals between governments precede the establishment of relations between companies.
The effectiveness of infrastructure diplomacy also depends on the trust that has – or has not – been built between stakeholders, which is based on, among other things, prior experience. Here, Russia and the US have much to draw on. More than a decade ago, ExxonMobil and Rosneft signed an agreement to jointly explore Arctic shelf deposits in the Kara Sea.

‘Doomed to an alliance for many, many decades’: ExxonMobil in the Russian Arctic

In April 2012, at the presentation to international investors in New York of the ambitious partnership of Russian and American oilmen, Eduard Khudainatov, then head of Rosneft, responded to a question about the possible collapse of the deal by saying: “if ExxonMobil wants to leave, it will do so according to the written plan and scheme. But we are doomed to an alliance for many, many decades.” The final investment decision was supposed to be made in 2016-17, but the partnership failed the test of geopolitical risks. 

Developing the Arctic shelf has been and remains a complex and expensive undertaking. The harsh Arctic weather, a lack of technology and expertise, and the reassertion of state control over resource extraction were factors in how the partnership evolved.

By 2011, Rosneft had secured licenses for areas in the Kara Sea and planned to bring in foreign companies to help with geological exploration.

Initially, in January 2011, BP was being talked about as the partner with which Rosneft planned to extract resources in the southern Kara Sea. However, Russian shareholders of TNK-BP blocked the deal through the High Court of London.

By August 2011, Rosneft had quickly switched to ExxonMobil, with which it eventually signed a “strategic cooperation agreement” to jointly explore and develop Arctic fields. By that time, ExxonMobil had been working with Rosneft on the Sakhalin-1 oil and gas project for almost 15 years, and the new project between the old partners looked to have a bright future.

For ExxonMobil, Rosneft was a convenient partner for gaining access to offshore resources. Rosneft paid lower taxes on average than other companies in the industry, enjoyed significant lobbying power and took advantage of its privileged position. In the four years preceding the deal, the number of licenses held by Rosneft rose 64% (versus 17% for TNK-BP and 2% for Lukoil). In exchange, with ExxonMobil’s help, Rosneft was able to meet its license obligations related to geological exploration and launch its international expansion.

According to media reports, Putin, then prime minister, estimated direct investment in this project at $200-300 billion, with a total impact of $500 billion, taking into account the necessary infrastructure. ExxonMobil planned to invest $3.2 billion in geological exploration, including in the Kara Sea at blocks licensed to Rosneft: Vostochno-Prinovozemelsky-1, -2 and -3. According to the company’s estimates, the reserves would exceed those of the Gulf of Mexico. Deputy Prime Minister Igor Sechin said developing the Kara Sea fields would require “at least 10 drilling platforms, each costing $15 billion.” They were to be built in Russia, but the project never got that far.

The agreement was subsequently expanded to include other licensed areas in Russian Arctic waters. Rosneft, in turn, was able to obtain proportional shares in its US partner’s North American projects in the US (including Alaska) and Canada.

In addition, the Arctic Research and Design Center for Continental Shelf Developments, which still operates today, was opened in St Petersburg – one of many entities that facilitated the transfer of ExxonMobil technology.

Work under the agreement ended with the imposition of US and EU sanctions in 2014 prohibiting long-term financing and exploration and development services in relation to Arctic offshore fields. ExxonMobil closed its projects with Rosneft, estimating its loss at $1 billion as of the end of 2014. The final break was announced in 2018, and the only significant event during this time was the discovery of the world’s northernmost oil field, Pobeda, in 2014. Sechin called it a shared victory for Rosneft and its US partners.

More than a decade after the end of active exploration work involving Exxon, there is no news about further development. In September 2025, the company’s CEO confirmed that it has “no plans” to reenter Russia.

Besides Exxon, US oilfield services companies also operated in the Russian Arctic. Baker Hughes and Halliburton transferred their Russian businesses to management after the invasion of Ukraine, while Weatherford and SLB continued operations, adapting them to sanctions.

International sanctions are the biggest drag on the prospects for cooperation in resource extraction, and the space for infrastructure diplomacy has been severely limited. This experience will inevitably shape any similar future initiatives – before investing in the Russian Arctic and making deals, foreign partners will look at these scenarios, especially after 2022, when foreign companies were forced to accept significant losses. It is unlikely that any member of the current Russian leadership can guarantee that the events of 2014 and 2022 will not be repeated.

However, in the current outlook, an easing or lifting of sanctions by the US (which appears to us increasingly unlikely) could signal new opportunities. Even then, it would require significant reciprocal concessions from the Russian side – for example, access to the Northern Sea Route to transport US LNG to Europe in exchange for technology and assistance in developing new fields. Yet given that the Arctic is today a far more securitized region than it was 15 years ago – increasingly viewed as a space of importance for defense and security – these concessions may be seen as disproportionate. They could ultimately result in a loss of sovereign control over the region or at least be perceived as such by the leadership and those responsible for securitizing the Arctic.

In mid-August 2025, before the meeting in Alaska, the Russian government presented the Americans with its own conditions for allowing US companies back into Russia – among them being a requirement that companies facilitate the lifting of political and economic sanctions. Thus, projects like the Exxon one are now seen as potential instruments of pressure to achieve foreign policy objectives. Indeed, this applies to all future partnerships.

The US may be interested in restoring cooperation beyond energy, as well. The development of rare earth metal deposits, including in the Russian Arctic, has been frequently mentioned publicly as a topic of US-Russia negotiations. This could potentially reduce US dependence on China and bring the US closer to Russia.

Rare earth metals: Claims and reality

In January, Dmitriev noted that partnerships with China and other BRICS members in rare earth metal mining were being explored and said he saw significant investment opportunities in the sector. At the same time, Trump insisted on a so-called “minerals deal” where Ukraine gives the US preferential rights to Ukrainian rare earth resources in exchange for US support for the Ukrainian war effort. In response to a question about this deal, Putin said that Russia is open to cooperation with the US government and private companies and that Russian resources, including rare earth metals (REMs), are significantly greater than those in Ukraine. He also mentioned mining in Russia-occupied Ukrainian territory. Putin’s press secretary, Dmitri Peskov, asserted that with the Americans needing REMs and Russia having plenty of them, the possibilities for cooperation are extensive.

Currently, China controls up to 90% of the global REM market, and as much as 80% of US high-tech production depends on Chinese REM exports. Countering China’s monopoly in the market explains the US interest in Russian REMs. According to Putin, REMs in Russia can be extracted and effectively used “as the technology develops,” and a system for measuring their reserves is already in place. Putin’s words are partly confirmed by experts. Representatives of Rosatom, Rosnedra (the Federal Agency for Mineral Resources) and the Ministry of Industry and Trade agree that there are no problems with the mineral resource base: REM reserves were explored back in the Soviet era. According to Oleg Kazanov, head of Rosnedra, Russia has 28.5 million tons of proven REM reserves, with consumption staying at 10,000 tons a year and production at 2,500 tons a year. Thus, Russia is among the leaders in REM reserves but lags in terms of mining and producing them.

Basically, Russia is currently not part of the global production cycle where REMs play a critical role. It is not enough to mine them; they must be fed into complicated production chains that transform them into components for high-tech manufacturing, including for the military-industrial complex. These chains are not well-established in Russia, making importing finished products easier and import substitution impossible.
At the same time, REMs – Russia’s reserves of which are concentrated in the Arctic, with the only active deposit in Murmansk Region – are unprofitable to extract due to difficult conditions. Russia’s deposits, located in remote areas lacking infrastructure and workers, cannot compete with China’s: their location increases project costs by 30-40%. Moreover, the Chinese government systematically tries to lower commodity prices and directs subsidies to the REM industry to enhance its competitiveness.
According to a Rosatom Nedra official, there has never been perfect competition in the REM market, and “today, REMs are essentially an instrument of geopolitical pressure”; potential  projects areprimarily political in nature.

Thus, the only remaining option is government will, which can allocate additional resources to developing the industry. An alternative is international partnership – Russia could take advantage of the US push to reduce dependence on Chinese-origin REMs and offer the resources and conditions for building the industry, practically from scratch. But this is reminiscent of developing the Arctic shelf – the conditions are no less challenging, the risks similar, guarantees nonexistent and the economic model unsustainable. There are just no grounds for infrastructure diplomacy: you can invite as many partners as you like, but they will have to do everything themselves.

Climate change to bind them all

Past examples of cooperation point to a dim outlook. First, the potential for infrastructure diplomacy is limited by sanctions, though it is important to consider that the core of an Arctic deal could involve lifting them in exchange not only for an end to the Ukraine war but also for access to Arctic resources or a privileged position relative to, for example, China. Second, the sides still must overcome the difficult legacy of a dearth of mutual trust, even in areas where both Washington and Moscow want to “just do business.” Finally, Dmitriev’s remarks about potential Russia-China-US projects in the Arctic sound completely fanciful.

Beyond major deals, however, there remains an area in which Russia and the US share a common interest, unconstrained by presidential terms or current political agendas: scientific research on climate and the climate crisis, which, as the data shows, is worsening each year. Regardless of sanctions or the specific individuals occupying high-ranking offices, the climate requires systematic attention from the scientific community. The current lack of a real climate agenda between the countries, which is currently hampered by sanctions, funding cuts and reduced data exchange, should not devalue the importance of potential cooperation both at the personal and at the institutional level.

Climate change is something that potentially unites many Arctic stakeholders, as it affects everyone, from those carrying out business activity and building infrastructure in the Arctic to others who just see the region as their homeland. Perhaps the crisis is the missing MacGuffin that should reset the drama and narrative of cooperation instead of “infrastructure diplomacy.” However, for this to happen, both Washington and Moscow must reconsider their climate priorities.