The Ministry of Energy said the areas in question were in the Eastern Province on the Mui Basin, 180 km (112 miles) north east of Nairobi, with a total area of about 490.5 square km.

Those interested would have to prove ability to raise funds in excess of $100 million for the projects on Block A, Block B, Block C and Block D, the ministry said.

“To accelerate exploration, exploitation and development of the coal, the Government of Kenya has created four blocks ... for lease to prospective investors,” the ministry said in newspaper advertisement.

Sixty two appraisal wells — most on Block C — were drilled and a feasibility study was done in Block C. Coal seams with thickness of between 0.3 meters to 13 meters were found in 40 of the wells at depths of 20 meters to 320 meters.

Kenya, east Africa’s largest economy, has previously invited bids for drilling of coal in other parts of the eastern region of the country, but has so far had limited success in developing viable coal projects.

It hopes the coal deposits could be an alternative energy source at a time when Kenya needs affordable power to drive Vision 2030, a plan for industrialization in 20 years.

The lion’s share of Kenya’s power is hydro based, which is unreliable during drought seasons as happened in 2008/9, forcing the country to rely on costly diesel generators.

Separately, Australia’s Pancontinental Oil & Gas and its joint venture partner Origin Energy plan to drill an exploratory well on Kenya’s offshore Block L8.

Although Kenya has no proven oil reserves, exploration interest is growing after the discovery of commercial oil deposits in neighboring Uganda and natural gas in Tanzania.

Earlier in the month, Pancontinental said it had received processed 3D seismic survey results for the block.

“The new 3D mapping will take two to three months and will locate a drilling site. Water depth over Mbawa is about 800 meters, easily within the range of modern drilling and production equipment,” it said in a statement seen by Reuters on Thursday.

Pancontinental said the Ministry of Energy had given it three more months on their current license to allow for a final 3D interpretation.

“The joint venture participants are talking to a number of large international companies to farm-in for drilling Mbawa. Drilling is currently planned for 2011,” it said.

Pancontinental has a 25 percent interest in the Block L8 licence while Origin holds 75 percent. Pancontinental also has a 40 percent stake in the adjacent Block L6 license.