Moscow  - Ukrainian Prime Minister Yulia Tymoshenko will fly to Moscow on Wednesday in last-gasp talks to avoid gas cuts to Ukraine ahead of a midnight deadline set by Gazprom for the settlement of a 2-billion-dollar debt.

"The embassy confirms that Prime Minister Yulia Tymoshenko is coming to Moscow on Wednesday for the final stage of the negotiations over Gazprom issues," Interfax news agency quoted Ukraine's embassy in Moscow as saying.

She will be accompanied by Ukraine's Energy Minister Yuri Prodan, the agency said.

Timoshenko's visit was announced after a possible breakthrough came in the standoff late Tuesday, raising hopes of avoiding the gas cuts and smoothing the flow of supplies to Europe.

Ukraine's government ordered a pair of Ukrainian state-owned banks, Oshadbank and Ukreksimbank, to loan funds necessary to cover the debt.

The Russian natural gas monopolist Gazprom had threatened Ukraine with a total cut-off of natural gas supplies effective the first day of 2009, if the debt were not cleared.

Gazprom claims Naftohaz owes it over 2 billion dollars for gas deliveries in November and December.

The Tymoshenko government announced the loan after hours of telephone conversations between Tymoshenko and Gazprom management, Channel 5 television reported.

Europe receives roughly one-quarter of its natural gas from Russia, 80 per cent of it delivered via Ukrainian pipelines.

Ukraine, during a 2006 Russian natural gas cut-off siphoned some of the Russian gas destined for Europe, causing price spikes as far away as Paris. (dpa)