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Oil giant BP's chief executive, Lord John Browne, has had his pay packet cut after a difficult year for the company.

Lord Browne, due to step down from the position in July, was paid £7.64 million in 2006 compared to his £8.45 million annual salary in 2005. Bonus and non-cash payments amounted to £2.5 million, a drop from the £3.3 million the previous year.

The chief executive's pay details were revealed in the company's annual review and contrasted with the firm's pre-tax profit increase of 15 per cent.

Chairman Peter Sutherland praised Lord Browne as "one of the great businessmen of his generation" and commended his "extraordinary performance" over the past 12 years.

However Mr Sutherland also noted that "BP's performance in 2006 could be best described as mixed" thanks to negative coverage about the company's safety record and a drop in oil output.

At the beginning of 2006, BP were aiming for 4.1 million barrels of oil equivalent per day (BOEPD).

The firm had to cut the target to a more realistic objective when the Prudhoe Bay oilfield in Alaska was forced to partially close in August.

Prudhoe did not resume full production until October due to severe corrosion in the transit pipes; before August, it produced 400,000 barrels of oil a day.

Last year also saw the inquest into the Texas City refinery disaster by the US chemical safety and hazard investigation board (CSB) report that "global management was aware of problems" with safety at the plant.

Seen as the worst US industrial accident in over ten years the explosion, caused by flammable vapours igniting, killed 15 employees and injured another 180.