* Veteran eurosceptic leads energetic campaign for EU vote
* His new Brexit Party tops polls for May 23 elections
* Conservatives, Labour devoting few resources to the campaign
By Elizabeth Piper
MERTHYR TYDFIL, Wales, May 16 (Reuters) - Brexit campaigner Nigel Farage is one of the few politicians in Britain enjoying this month's elections to the European parliament. In fact, he's relishing it.
Farage, a 55-year-old former commodities broker, is one of Britain's foremost critics of what he describes as an institution at the heart of a failing "euro project".
But the veteran eurosceptic is putting everything into regaining a seat in the assembly, hoping his clear message in support of Britain's departure from the European Union will give him a foothold to transform the country's politics.
It is a noisy, and for mainstream parties frightening, comeback for a man who took a step back from politics after Britain voted to leave the EU in 2016. He said at the time he had "done my bit" to secure Brexit, the biggest shift in the country's foreign and trade policy for more than 40 years.
Fast forward three years, Britain has missed its March 29 Brexit deadline, and positions on how, or even whether, Britain should leave have become more entrenched. Prime Minister Theresa May has so far failed to negotiate a way through.
It is fertile ground for Farage and his newly formed Brexit Party, which is topping the polls before the May 23 election.
Britain's main parties, the governing Conservatives and opposition Labour, have dedicated few resources to campaigning for the election, while Farage is mounting an energetic and fast-paced campaign.
His sleek new operation sometimes misfires. As Farage walked down the main high street in this traditionally Labour supporting former mining town on Wednesday to greet supporters, one man standing outside a bar made his feelings clear.
"You are not welcome in Merthyr," he shouted. Others tell Farage where to stick "his Brexit".
But by evening, Farage has fired up a loyal hundreds-strong crowd, who paid 2.50 pounds ($3.20) each to see him take a stage in the car park of a newly built shopping centre, where he stood with his back to the rolling valleys of South Wales.
"The reason we've got division in this country ... is many in our establishment far from respecting the (referendum) vote have done everything they can in the last two years to overturn the greatest democratic exercise in the history of our nation," he told supporters in Merthyr, which like Wales as a whole, voted to leave.
"And it is a total and utter disgrace."
The crowd pay him back in return, booing and shouting "traitor" when he names those "establishment politicians" such as May and former prime ministers, Tony Blair and John Major.
GENERAL ELECTION BATTLE
Some supporters want him to go further. They will not only back him now in the European elections but hope to be able to vote for his Brexit Party at Britain's next national election. Many lawmakers expect a vote to happen much sooner than its scheduled date of 2022 because of May's problems over Brexit.
"We believe with your support we can change politics for good," Farage said.
Members of the European Parliament feel remote to many in Britain and it is normally a low-key contest to elect MEPs. But this month's vote has become more important, offering a gauge of opinion since Brexit has all but stalled.
Divisions wrought in Britain by the 2016 referendum have deepened and opinions have hardened in parliament between those who want to leave the EU without a deal and others who want to stop Brexit altogether. This has reduced May's chance of winning approval for her agreement at the fourth attempt.
Both main parties were punished by voters in local elections this month, and the polls for the European elections do not make pretty reading for either, especially for the Conservatives.
One poll, on May 13, showed May's Conservatives could fall to fifth place, with Labour second, far behind the Brexit Party.
But like Farage's party which wants to leave the EU without a deal, pro-EU, or so-called "Remain" parties, which have a clear message in favour a second referendum and to stay in the bloc are also gaining.
The Liberal Democrats, whose campaign pledge is "Bollocks to Brexit", polled third, followed by the Greens. But a new party, Change UK, formed by Conservative and Labour lawmakers who are campaigning for a second referendum, is trailing.
In Merthyr, a town where the high street is pockmarked with shuttered shops and derelict buildings and at night, people drink cans of lager on street benches, many interviewed say they have little interest in the battle for the European elections.
Tired of politics, some, who said they had only ever voted in the EU referendum, spoke of the confusion surrounding Britain's departure and were blunt on how little time for what many called "political games" in Westminster.
But for those with stronger views, Farage is manna. Taking cues from the Five Star Movement in Italy and the U.S. presidential campaign by Donald Trump, his message is simplistic and binary - its us against them, the establishment.
And Labour, which has dominated politics in Merthyr since the town elected founder Keir Hardie as the party's first member of parliament in 1900, is in Farage's sights.
"There are three big areas; South Wales, the Midlands of England, the North of England, these are three areas that are predominantly Labour seats but were big leave areas as well and I think that's where we're starting to do very well," he said.
"There's more to come," he chuckled.
For Lee Heggie, a 49-year-old computer repair shop owner, the message is what he wants to hear, feeling betrayed by politicians who never "step outside the Westminster bubble".
But step 100 metres from his stall in the town's indoor market, to the bakery around the corner, and Pauline Jones is just as angry about Brexit.
"I'm hoping he (Nigel Farage) doesn't come to me because it's lies," she said while serving sandwiches and sausage rolls. "They're just feeding the 'simple people', the working class people, lies, that it's going to be better."
"It's not going to be better." ($1 = 0.7783 pounds) (Additional reporting by Iona Serrapica and Alex Fraser; editing by Anna Willard)
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