Canadian mining giant Barrick Gold on Tuesday announced it has eliminated all of its hedges on the world's largest gold production and reserves, hoping to profit from rising gold prices.

The gold hedges were contracts whereby Barrick -- the world's number one gold producer -- sold gold ounces it expected to produce in advance for a fixed price.

In the meantime, if the price of gold increased, Barrick was obligated to sell its gold at the lower price or buy it in the marketplace at a higher price to meet its contractual obligations.

Hedging is normally used to insulate companies from market price fluctuations and provide a level of financial stability for their operations.

Barrick announced in September it would pull the plug on its remaining gold hedges, as it was not benefiting from any increase in the gold price, which is forecast to continue rising over the long term as deposits are depleted.

"Our positive view on the gold price led us to accelerate the elimination of these contracts ahead of the schedule we had established," said Aaron Regent, Barrick?s president and chief executive.

To buy back its gold hedges, Barrick issued new equity in September and in October issued new long term debt securities for total net proceeds of 5.1 billion dollars.

In the past two years, Barrick has bought back hedges for 9.5 million ounces of gold at an average price of 930 dollars per ounce.

For 2010, Barrack expects to produce 7.7-8.1 million ounces of gold.

On Tuesday, gold prices reached a new record high in London, at 1,199.49 dollars.