Newmont Mining eliminates gold hedge position

Newmont Mining, the world's second largest gold producer, has eliminated its entire $1.85 million ounce gold hedge position.

The move, which cost the firm $578 million, makes it the world's largest unhedged gold producer.

Newmont is also planning to monetize certain components of its royalty and equity portfolio over the coming year. This will lead to its merchant banking segment becoming a stand-alone entity.

"With the elimination of our gold hedge book, we have renewed our commitment to maximizing gold price leverage for our shareholders," said the firm's chief executive, Richard O'Brien.

"In addition, we are focused on delivering improvements in our operating performance and cost structure going forward."

The transactions signify Newmont's willingness to focus on its core gold business.

The Denver-based company has active mines in the US, Bolivia, Australia, Indonesia, New Zealand and Peru. It produces around 233,000 kilograms of bullion each year.