gas compressor station
© Reuters/Gleb Garanich
A gas compressor station in western Ukraine
After months of tense negotiations and years of legal battles, Moscow and Kiev have made an agreement on extension to the current gas transit agreement, which expires on December 31.

"Russia and Ukraine have signed a protocol on agreements on continuing gas transit as well as on settling reciprocal claims," a spokesperson of the Russian gas giant Gazprom, told journalists without providing any details of the document.

Russia, Ukraine and the European Commission have reached the "final agreement" on all the "principled positions" related to the gas transit and the settlement of reciprocal claims, the Ukrainian president's office said on its Facebook page, adding that the details of the agreement would be revealed on Saturday.

Russia's Deputy Prime Minister Dmitry Kozak also said that the sides managed to find "mutually beneficial" solutions to all the issues and there would be "no more lawsuits and legal arguments." He added that a new agreement is expected to be signed before the year's end.

The sticking points included pricing for Russian gas for Ukrainian consumers and the $3 billion verdict against Russia's Gazprom by the Stockholm Arbitration court in favor of Ukraine's Naftogaz.

Earlier on Friday Russian and Ukrainian delegations reached an "agreement in principle" on the gas transit deal following tense talks in Berlin. Moscow and Kiev were then due to approve the agreement. The previous gas transit contract was scheduled to expire on December 31, 2019.

Russia has been building alternative gas pipelines bypassing Ukraine to deliver natural gas to European customers. One of such routes is Nord Stream 2, which runs from Russia to Germany along the bottom of the Baltic Sea. The project is set to deliver an additional 55 billion cubic meters of natural gas per year.

However, more than 50 percent of Russian gas supplies to the EU will still be going through Ukraine. Russia and its partners, including Germany, have repeatedly stressed that Nord Stream 2 is meant as a supplementary route to guarantee stable supplies to Europe, but will not replace transit through Ukrainian territory.

The gas transit agreement between Russia and Ukraine raises questions about the latest US sanctions against Nord Stream 2, since one of the arguments in Washington for penalizing the Russian pipeline has been that it deprives Ukraine of gas transit fees.