Kenya will use 15 to 20 billion shillings (up to $155 million) from an initial public offering (IPO) of shares in Kenya Pipeline Company to expand the main Nairobi airport, President William Ruto said on Monday.

The investment will come from the country's new National Infrastructure Fund, which is being financed in part by the sale of state assets. Last week, the government said it had raised around $822 million after selling a 65 percent stake in Kenya Pipeline Company through an initial public offering.

Officials say the expansion of the airport, Kenya's busiest international gateway, will be the first major project financed under the new funding model. Authorities have warned that the facility is operating beyond capacity and requires modernization to keep pace with rising passenger and cargo traffic.

"The expansion of the Jomo Kenyatta International Airport will be the first major project financed through this new model of financing under the National Infrastructure Fund," Ruto said.

He added that between $116 million and $154.70 million from the fund would serve as seed capital for the airport expansion project, which the government hopes will strengthen Nairobi's role as a regional aviation hub.

Edited by CGTN Africa reporter Marion Gachuhi