UPDATE 1-Russia, Ukraine to hold further gas talks in May

Russia and Ukraine will meet for further gas talks in May after an EU-mediated discussion in Brussels on Monday yielded no concrete results, Russian Energy Minister Alexander Novak said.

The talks have been focusing on Russian gas transit via Ukraine to Europe, the source of up to 3 percent of Ukrainian gross domestic product. Russian gas supplies to Europe have become increasingly politicised after Moscow annexed the Crimean peninsula from Ukraine in 2014 following street clashes in Kiev and after Ukraine's pro-Moscow president fled to Russia.

Russian President Vladimir Putin has said Moscow is ready to keep its transit of gas to Europe through Ukraine once the current deal with Kiev expires on Dec. 31, 2019 if supplies are economically viable. Ukrainian state energy company Naftogaz accused Russia of delaying negotiations in order to get its Nord Stream 2 pipeline built first.

Russia's planned doubling of capacity on the Nord Stream pipeline across the Baltic Sea to Germany could help Moscow bypass exports via Ukraine. That would deny Kiev transit fees. "Gazprom is delaying real talks in terms of transit in order to build Nord Stream 2 and then to have a different negotiating position," Naftogaz Deputy Chief Executive Yuriy Vitrenko told Reuters before the talks on Monday.

"Then they will say, 'We are OK without any Ukrainian transits at all'." To ease market concerns, Vitrenko said the two sides should aim to reach an agreement by the beginning of the summer.

THREE-WAY TALKS European Commission Vice-President Maros Sefcovic chaired Monday's three-way meeting in Brussels with Ukrainian Foreign Minister Pavlo Klimkin and Novak.

Sefcovic said he expected no problem with supplies of Russian gas via Ukraine to Europe this winter. Ukraine has stopped buying gas from Russia in the wake of Moscow's annexation of Crimea and the EU has called on member states to lessen their reliance on Russian energy imports.

"We need a strong commitment by the two sides to advance in the talks, given that the existing transit contract expires at the end of this year," Sefcovic said ahead of the meeting, which executives from Naftogaz and Russian gas producer Gazprom also attended. Moscow and Kiev have clashed frequently over energy. A lengthy legal dispute between Gazprom and Naftogaz led to court rulings in February 2018 which instructed each company to compensate the other.

Naftogaz emerged the net winner, gaining $2.56 billion from Gazprom. Gazprom is challenging the ruling. Gazprom's partners in the $11 billion Nord Stream 2 pipeline project include Germany's Uniper and Wintershall and France's Engie. (Reporting by Alissa de Carbonnel in Brussel; Editing by Jason Neely and Dale Hudson)