Gold mining firm Acacia expects to start commercial production of gold in western Kenya in 2022.
The company has made a discovery of 1.3 million ounces/36 tonnes of gold in the Liranda corridor near Kakamega town.
"The discovery of 1.3 million ounces of gold is an encouraging start," said Acacia's chief executive Brad Gordon. "For the project to be economically viable, we need deposits of at least two to three million ounces."
Acacia Mining Plc will invest $12 million this year in exploration activities in western Kenya to exploit at least two to three million ounces of the precious metal.
Mr Gordon said that the company will spend $10 million on exploration activities in the 30-kilometre square Liranda corridor, and a further $2 million in the surrounding area as the firm's special licence 213 covers about 1,600 square kilometres.
Mining Cabinet Secretary Dan Kazungu said that the potential of Acacia's western Kenya project is exciting.
"It could ultimately lead to the creation of a gold mining industry that would benefit our economy and people," he said.
In August 2016, Acacia, which has operations in Tanzania, Burkina Faso and Mali, bought a 49 per cent stake from a subsidiary of Lonmin plc for $5 million.
Acacia is exploring Kakamega, Vihiga, Siaya and Kisumu counties.
Meanwhile, Goldplat Plc has commissioned a new processing plant to expand gold production in the Kilimapesa mine near Kilgoris town in western Kenya at a cost of $2 million.
"Although it is modest in terms of production, it will help start sustainable profitability at Kilimapesa," said chief executive Gerard Kisbey-Green.
The expansion is aimed at reducing the cost of operations and returning Kilimapesa mine to profitability. The company made a net loss of $892,731.31 in the year ended June 30, 2016.