* Separatist rebels control territory in east Ukraine
* Government forces retake Mariupol and parts of border
* Ukraine ready to compromise on gas price
* U.S. says Russia sends tanks, rocket launchers into
(Adds U.S. State Department comment, paragraphs 11-14)
By Aleksandar Vasovic
MARIUPOL, Ukraine, June 13 The Ukrainian flag
fluttered over the regional government headquarters in the
strategic port city of Mariupol on Friday after government
forces reclaimed the city from pro-Russian separatists in heavy
fighting and said they had regained control of a long stretch of
the border with Russia.
The advances are significant victories for the pro-European
leadership in a military operation to crush the rebellion, which
began in east Ukraine in April, and hold the country together.
Parallel peace moves are moving slowly, however, and Russia is
threatening to cut gas supplies to Ukraine from Monday in a row
In central Mariupol, police cordoned off several streets,
where roadblocks of sandbags and concrete blocks, once manned by
rebels, were riddled with bullet holes, and the burnt-out hulk
of an armoured personnel carrier with rebel insignia smouldered.
"At 10:34 a.m. (0734 GMT), the Ukrainian flag was raised
over City Hall in Mariupol," Interior Minister Arsen Avakov
wrote on Facebook. That was less than six hours after the attack
began on the city of 500,000, Ukraine's biggest port on the Azov
A ministry aide said government forces had attacked after
surrounding the rebels and giving them 10 minutes to surrender.
At least five separatists and two servicemen were killed before
many of the rebels fled.
A group of about 100 Mariupol residents, who had gathered in
the centre to show their opposition to the government's actions,
exchanged obscenities and crude gestures with Ukrainian soldiers
driving through town in a column of armoured trucks.
"The government brought everything here, including a cannon
... people were not allowed to come and witness how the
government was shooting its own citizens," 52-year-old Andrei
Mariupol, which has changed hands several times in weeks of
conflict, is strategically important because it lies on major
roads from the southeastern border with Russia into the rest of
Ukraine, and steel is exported through the port.
Regaining full control of the 2,000-km (1,200-mile) frontier
is also vital for the government because it accuses Moscow of
allowing the rebels to bring tanks, other armoured vehicles and
guns across the border.
Avakov said government forces had won back control of a
120-km (75-mile) stretch of border that had fallen to the
rebels, but it was unclear who controlled other parts of the
In Washington, the U.S. State Department said Russia had
sent tanks, heavy weapons and rocket launchers to Ukraine in
recent days in support of separatists in the east of the
country. The confirmation by the United States of reports that
Russian tanks had crossed the border into Ukraine is likely to
deepen strains with Moscow.
"We assess that separatists in eastern Ukraine have acquired
heavy weapons and military equipment from Russia, including
Russian tanks and multiple rocket launchers," State Department
spokeswoman Marie Harf said in a statement.
Harf told a briefing earlier that a convoy of three T-64
tanks, several MB-21 "or Grad" multiple rocket launchers and
other military vehicles had crossed from Russia into Ukraine in
the last three days.
"This is unacceptable," she said. "A failure by Russia to
de-escalate the situation will lead to additional costs."
IMPASSE AT GAS TALKS
The rebels rose up in the Russian-speaking east and
southeast after Russia annexed Crimea in March following the
overthrow of pro-Russian President Viktor Yanukovich, who had
triggered protests by spurning trade and political pacts that
would have deepened ties with the European Union.
The new president, Petro Poroshenko, intensified the
military operation against the rebels after he was elected on
May 25, but is also trying to win support for a peace plan.
On Friday, one separatist leader, Denis Pushilin, said he
could be open to the idea of talks provided there were
mediators, including Russia, present. "If an international
organisation were also involved, that would be a plus too," he
said in an interview on Russian television.
Poroshenko's aides say progress has been made at initial
meetings with a Russian envoy and that any immediate threat of a
Russian invasion has receded. But tensions have risen at talks
on how much Ukraine should pay for Russian natural gas.
Ukraine said it was preparing for gas supply cuts on Monday,
the deadline for it to settle $1.95 billion in unpaid bills.
This could disrupt supplies to the European Union, as about half
of its sizable gas imports from Russia flow via Ukraine.
Political ties have also been strained by the appearance of
several tanks in east Ukraine. Avakov accused Russia on Thursday
of allowing the rebels to bring them across the border and
Poroshenko told Russian President Vladimir Putin by phone that
the situation was "unacceptable".
Evidence that Russia is directly assisting the rebels
militarily would implicate Moscow in the uprising, making a
mockery of its denials of a role in the fighting.
(Additional reporting by Pavel Polityuk and Natalia Zinets in
Kiev, Vladimir Soldatkin in Moscow and Lesley Wroughton in
Washington; Writing by Timothy Heritage and Alessandra Prentice;
Editing by Kevin Liffey and Dan Grebler)