Intense fighting in Ukraine, including a rocket strike on Kiev's military headquarters in the east, killed at least 23 people on Tuesday on the eve of a four-way peace summit.

As diplomats scrambled to finalise a deal to end the 10-month war, pro-Russia rebels sought to encircle railway hub Debaltseve and Ukrainian forces launched a counter-offensive around the strategic port of Mariupol.

Ukrainian President Petro Poroshenko said rockets for the first time hit the military's command centre in Kramatorsk, the government's administrative capital in the region, well behind the frontlines and far from rebel positions.

The strikes also hit residential areas around the city, killing eight local residents, officials said. Sixty-three people, including 32 soldiers, were also wounded.

Officials initially said the rockets were hi-tech Tornado missiles, but later said they were Soviet-era Smerch rockets.

Kiev and the West accuse Moscow of supplying and training the heavily armed separatists, but Russia denies the claims.

Rebels say their weapons have been captured from Ukrainian forces, although Kiev has cited numerous cases of the insurgents using advanced weapons that are only available from Russian arsenals.

"The shelling is with Vladimir Putin's compliments, who else could have done this?" shouted a Kramatorsk resident as he walked past an unexploded rocket.

Another seven Ukrainian soldiers and eight civilians were killed in fighting over the last 24 hours, Kiev officials and rebels said, including in Debaltseve, which the insurgents claim to have surrounded.

Ukrainian forces took control of three villages east of Mariupol, around 90 kilometres (60 miles) south of the rebel stronghold Donetsk, and fierce fighting raged for control of two more, senior interior ministry advisor Zoryan Shkiryak said.

The violence came as rebels, diplomats and mediators gathered in the Belarussian capital Minsk to bridge gaps on a possible peace deal, which the leaders of Ukraine, Russia, France and Germany hope to sign at a summit in the city on Wednesday.

Rebel negotiator Denis Pushilin told the separatists' news agency that he was heading to Minsk for talks with mediators from the Organization for Security and Cooperation in Europe (OSCE) as well as Russian and Ukrainian representatives.

French President Francois Hollande and German Chancellor Angela Merkel have been conducting frantic diplomacy, taking the "last chance" deal to Poroshenko and Russian leader Putin.

Hollande said on Tuesday that he was going to Minsk with the "strong will" to achieve a peace deal.

A source close to German Foreign Minister Frank-Walter Steinmeier told AFP he had called his Russian and Ukrainian counterparts on Tuesday to "seek compromise on difficult questions".

Merkel was in Washington Monday for lengthy talks with US President Barack Obama on the initiative to defuse fighting that has killed at least 5,300 people since April.

Obama agreed to hold off on sending arms to Ukraine until truce efforts have played out.

Proponents of sending arms to Ukrainian forces argue that Kiev needs the weapons to counter advanced Russian hardware.

But Merkel has opposed the move amid fears that the Ukraine conflict could become a proxy war between Russia and the West.

Some in the West however say hi-tech weapons could at least make the conflict more costly and painful for Russia, already reeling under the impact of US and EU sanctions as well as low oil prices.

Foreign Secretary Philip Hammond told parliament on Tuesday that Britain was not planning on sending "lethal aid" to Ukraine, "but we reserve the right to keep this position under review."

Ahead of the Minsk summit, the European Union decided to hold off implementing new sanctions against Russia.

Putin has warned that a "number of points" still needed to be agreed before the Minsk meeting can take place.

The new plan is based largely on an ignored peace deal agreed in September in Minsk, but a key sticking point is believed to be whether it will extend rebel control over territory seized in recent weeks.

The new territory amounts to around 500 square kilometres (around 200 square miles), and Kiev is adamant the demarcation line agreed in September should not be shifted.

Hollande has said the proposal includes the creation of a 50 to 70-kilometre (31 to 44-mile) demilitarised zone around the current frontline.

Other contentious issues include the degree of future autonomy in the east and Kiev's insistence on retaking control of the roughly 400-kilometre border between separatist Ukraine and Russia.

"Eight days ago, they (Ukraine and Russia) weren't talking to each other. Now, they've sat at the same table," a French diplomatic source said, describing negotiations as "very complicated".