"The process of payment will be completed in the next few hours. We will transfer $1.5 billion for November and December," Naftogaz spokesman Valentyn Zemlyanskiy said.
Russian gas monopoly Gazprom reiterated its demand on Tuesday that Ukraine pay a $2 billion debt, a sum that includes fines accumulated for delayed payment, threatening to start reducing supplies as of January 1, 2009.
The 2006 gas row between the two former Soviet states resulted in a brief cutoff in supplies to Ukraine. When shortages were reported in some East European countries, Russia accused Ukraine of siphoning off Europe-bound gas. Ukraine transits about 80% of Russia's Europe-bound gas.
Ukraine's government said earlier on Tuesday that Ukraine would borrow up to $2 billion from two state-run banks, Oshchadbank and Ukreksimbank, to pay its gas debt.
President Viktor Yushchenko's press office said the country had paid off the debt in full paving the way for signing a contract on supplies next year, but Gazprom denied that.
"We have not received the money, and it is premature to say the debt has been repaid," Gazprom spokesman Sergei Kupriyanov said.
Gazprom chief Alexei Miller restated earlier on Tuesday the company's position that Ukraine should also pay the market rate for Russian gas of $418 per 1,000 cu m from January 1. In 2008, Ukraine paid just $179.5.
The country has been badly hit by the global economic crisis, and sought $14.5 billion from the International Monetary Fund.
The European Union, which imports a quarter of its gas from Russia, pledged assistance in solving the ongoing gas dispute on Tuesday.
