UPDATE 1-Russia may resume gas supply next week if Ukraine pays $2.2 bln …


* Russia, Ukraine reach deal on supplies in Brussels on
Thursday

* Gazprom says to restart supplies within 48 hours from
payment

* Dispute has threatened winter supplies to Europe

(Adds more detail, Yatseniuk)

By Denis Pinchuk and Olesya Astakhova

MOSCOW, Oct 31 (Reuters) – Russia may restart gas supplies
to Ukraine as soon as next week if Kyiv pays $2.2 billion worth
of debts and pre-payments, Alexei Miller, head of state gas
monopoly Gazprom, said on Friday.

Moscow, Kyiv and the European Union clinched a deal on
Thursday that would resume supplies of Russian gas to Ukraine
over the winter in return for payments funded in part by the
Ukrainian government’s Western backers.

Gazprom halted supplies to Ukraine in June amid a bitter
dispute over debts and pricing between Moscow and the former
Soviet republic that is now seeking to foster closer ties with
the West rather than Russia.

Miller said Gazprom would restart supplies to Ukraine within
two days after Kyiv covers part of its debt for past gas
deliveries and provides a pre-payment for supplies that would
reach it in November.

“Everything depends on when Ukraine makes this payment. We
understand this can happen by the end of next week,” Miller told
state TV broadcaster Rossiya 24 in an interview when asked about
possible timing for resuming supplies.

Miller said Ukraine must provide $1.45 billion to cover for
part of gas debt and pay $760 million up front for November
before supplies resume. By the end of the year, Kyiv must pay a
total of $3.1 billion in debts for past deliveries, he added.

He said Kyiv will need to pay another $760 million in
advance to receive gas in December and that maximum daily
supplies stood at 114 million cubic metres with a deal between
the sides for monthly supplies of 2 billion cubic metres in both
November and December.

The deal struck in Brussels on Thursday allows Kyiv to use
some resources under its existing accords with the EU and the
International Monetary Fund to fund the pre-payment. Kyiv says
it has resources put aside to cover past debts to Gazprom.

Under the agreement, Ukraine would buy gas for the rest of
this year at $378 per 1,000 cubic metres and at $365 in the
first quarter of next year.

Russia says the price amounts to a $100 discount compared to
previous agreements with Ukraine and Miller said on Friday he
expected Russia’s government to approve it formally on Saturday.

WINTER SUPPLIES

Kyiv said on Friday documents signed in Brussels included
the EU executive arm’s guarantees of financial support to
Ukraine should Russia renege on the agreed price, as well as the
promise of support from Brussels for further increasing reverse
gas flows to Ukraine from EU member states.

The EU depends on Russia for about one third of its gas
needs and about half of that flows in transit via Ukraine. Gas
spats between Moscow and Kyiv in the past have disrupted those
supplies and left parts of Europe shivering in winter.

Ties between Kyiv and Moscow are now also badly strained
over Russia’s annexation of Crimea in March and the pro-Russian
separatist rebellion that followed and is threatening to split
Ukraine’s eastern regions.

Kyiv and the West blame Moscow for fanning the unrest and
providing arms and troops to rebels in fighting that has killed
more than 3,700 people since April. Moscow backs the separatists
but denies being party to the armed conflict.

On Thursday, European officials assured that gas supplies to
Europe would not be in danger this winter. Miller struck a more
cautious tone, saying gas transit risks persisted and sought to
put the blame on Ukraine for any future disruptions.

Ukraine’s Prime Minister Arseny Yatseniuk is expected to
speak at the country’s gas transport monopoly Ukrtransgas later
on Friday.

(Additional reporting by Pavel Polityuk in Kyiv, Writing by
Gabriela Baczynska, Editing by David Evans)