Base metals miner HudBay Minerals Inc. says it expects the restart of one northern Manitoba mine to offset an expected decline in 2010 production as another mine reaches the end of its producing life.

The Toronto-based company said Wednesday it will restart its Chisel North mine, which had been shut down because of low metal prices. It's a move the miner hopes will offset lost production from its Trout Lake operation, now coming to the end of its production life.

"With the restart of operations at our Chisel North mine offsetting the anticipated decline in production as we near the end of mine life at Trout Lake, we expect another year of solid results in 2010," said Warren Holmes, executive vice-chairman and interim CEO.

The changes will help HudBay meet its 2010 production forecasts of between 75,000 and 90,000 tonnes of zinc, 45,000 to 55,000 tonnes of copper, 85,000 to 100,000 ounces of gold and 800,000 to 900,000 ounces of silver, the company said.

The 2010 estimate compares to production of 78,722 tonnes of zinc, 48,397 tonnes of copper, 92,201 ounces of gold and one million ounces of silver in 2009.

HudBay also said its capital spending this year should return to "more normal levels" compared with 2009, when the global recession affected markets as well as the prices of key industrial metals the company produces.

Last year, the miner cut back capital spending due to lower prices and flagging demand from key customers, mainly in the industrial, building and steel sectors.

This year, HudBay said it expects to spend about $207.9 million to develop its mining projects.

The company also announced an increase in exploration spending for 2010 to about $41.8 million from $30.8 million in 2009.

"Historically, we have seen a correlation between higher exploration spending and our rate of discovery of new mines, so we are very excited about our exploration program for this year," Holmes stated in a release.

In November, HudBay announced that Peter Jones would step down as CEO of the company after only eight months, raising speculation HudBay is looking to grow through acquisition or merger and wants a dealmaker at the company's helm.

Jones, who was CEO of HudBay from 2002 to 2008, was brought back by a new board of directors to help turn the company around and revive its stock price after a failed attempt by former CEO Allen Palmiere to acquire Lundin Mining Corp. (TSX:LUN) in 2008. Jones's replacement will be HudBay's fourth chief executive in less than two years.

With almost $900 million in cash, cash equivalents and short-term investments, HudBay has one of the strongest balance sheets in the industry but has had a difficult time capitalizing on acquisitions.

The Lundin deal fell apart last winter when shareholders revolted over HudBay's plan to issue 157.6 million new common shares as part of the agreement, more than doubling its share base without a shareholder vote.

The Ontario Securities Commission eventually ruled that HudBay had to hold a shareholder vote on the plan, and the deal collapsed shortly thereafter.

Since then, there have been rumours that HudBay could be the target of an acquisition by Indian mining company Vedanta Resources PLC or that there could be a deal with Vancouver-based Quadra Mining Ltd. (TSX:QUA), but nothing has materialized.

Meanwhile, Jones has focused on developing the company's existing assets, particularly the Lalor deposit in northern Manitoba and the Fenix project in Guatemala.

HudBay, which had nearly 1,800 employees at the end of 2008, has mines, mills and other assets in North and Central America.

In Wednesday trading on the Toronto Stock Exchange, HudBay shares lost 23 cents to $12.46, a drop of nearly two per cent.