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Northern Star s Paulsens gold mine.
Northern Star's Paulsens gold mine.

UPDATE 1.20pm: Northern Star Resources says it has entered into a one-year, flat forward hedge program covering about 28 per cent of production from its Paulsens and soon to be acquired East Kundana (51 per cent) and Kanowna Belle operations.

Under the terms of the hedge, Northern Star will sell 100,000 ounces of gold at an average price of $1462.16 an ounce.

"The board believes that entering into the hedge program is a prudent strategy for Northern Star in light of the recent volatility of the gold price, and the establishment of a $50 million revolving credit facility with Investec," the company said in a statement.

Gold price hedging allows producers to lock in forward production for a specific price, thereby guaranteeing revenue certainty.

Northern Star shares closed down 2.5 cents, or 2.76 per cent, at 88 cents.