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The Bakrie group’s PT Bumi Resources, the biggest coal miner in the country, has a remaining “war chest” of about $1.6 billion and has plans to spend it, a senior executive said on Friday.

Dileep Srivastava, Bumi’s vice president for investor relations, outlined the company’s two-year “road map.”

He said Bumi would use about $1 billion of a $1.9 billion loan from Chinese sovereign wealth fund China Investment Corp. in September to pay for exploration activities of its various subsidiaries. Another $600 million in proceeds from two bond offerings last month would be set aside for mergers and acquisitions.

He added that Bumi is expecting to roughly double its annual coal production to about 100 million tons by the end of 2012.

“We are preparing for the next boom right at the beginning of an impending upturn,” Dileep said. “If we are successful, we will immediately accumulate value. Otherwise, we will repay the loans and deleverage.”

Bumi’s leverage has been on the minds of investors in recent weeks, causing some volatility in its stock price. It has borrowed nearly $3 billion in the second half of the year, to pay off debts and finance previous acquisitions.

But Dileep said investors should not be worried about the company’s ability to pay its mounting debts. “In 2013, our coal production will have doubled, so will our earnings. Therefore, there should be no problem in repaying the loans then,” he said.

Bumi has projected that coal prices will rise by 40 percent next year as demand improves. It is required to begin repaying some of its debt to CIC starting in 2013.

Dileep noted that Bumi’s two most-prized coal assets, PT Kaltim Prima Coal and PT Arutmin Indonesia, had 2.1 billion in coal reserves “easily valued at $16 billion.” Bumi owns 70 percent of both units. India-based Tata Power owns the other 30 percent stakes.

He said cash loaned by CIC will be used on the companies’ gold and copper projects in Gorontalo and Palu in Sulawesi, its iron ore project in Mauritania and maybe the Herald Resources zinc and lead project in North Sumatra.

Separately, KPC and Arutmin would spend $1.1 billion on capital projects over the next two years to boost coal production to the targeted 100 million tons a year. Dileep said money for the capital expenditure would not come from Bumi.

Both companies had produced a total of 44.5 million tons by the end of September, an increase of 18.7 percent from the same period last year.

Meanwhile, the $600 million raised in two bond offerings last month would be used to finance mergers and acquisitions, such as Bumi’s indirect purchase of two stakes in PT Newmont Nusa Tenggara last month.

Bumi subsidiary PT Multicapital teamed up with three local governments in West Nusa Tenggara to acquire two stakes totaling 24 percent of NNT, with plans to acquire another 7 percent stake that must be divested by March.

Dileep said the bond proceeds could also be used to finance the Maruwai coking coal project with BHP Billiton if the latter decided to sell a stake in the project.

Andrew Beckham, Bumi’s chief financial officer, said on Thursday that the company is in talks with brokerage firm Recapital Advisors about becoming the exclusive marketing agent for coal produced by PT Berau Coal, the country’s fifth-largest producer.

Recapital, which has close ties to the Bakrie group, on Nov. 29 agreed to buy a majority stake in Berau from PT Armadian Tritunggal for $1.5 billion. A source close to the deal said Bumi may help Recapital finance the acquisition in exchange for marketing rights.