MOSCOW, April 29 (RIA Novosti) - Russia could pay Ukraine in advance for the transit of Russian gas to enable Ukraine's Naftogaz to pay for Russian gas supplies, a source in the Russian delegation said Wednesday.

Advance payments "will enable Naftogaz of Ukraine to pay for April gas supplies," the source said.

Gazprom expressed concerns earlier in the day over Ukraine's ability to pay for gas.

"Gas will not be sold on credit. In this respect, we are concerned over the situation in Ukraine, taking into consideration its low ability to pay and political instability," said Viktor Valov, deputy head of the gas monopoly's department for contacts with former Soviet republics.

Prime Minister Vladimir Putin discussed all aspects of the gas issue with his Ukrainian counterpart, Yulia Tymoshenko, when they met in Moscow on Wednesday.

After the talks, Tymoshenko said that on the specific issue of gas intended for storage facilities rather than consumers, Kiev had proposed that Moscow pay in advance for the transit of the gas, allowing Ukraine to use the receipts to pay the costs of pumping gas into its underground reservoirs.

"The Ukrainian side has proposed signing an intergovernmental agreement whereby [Russia] would pay in advance for [Ukraine's] transit services, a scheme that we will be able to use to cover the costs involved in the pumping of gas into underground storage facilities," the Ukrainian prime minister said.