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Oil giant BP has reported a 45 per cent fall in third quarter profits, with a slowdown in production partially to blame for the drop.

In a statement today the company revealed that its replacement cost profit declined to $3.88 billion (£1.89 billion) for the three months to the end of September. That compared to a profit of $6.98 billion (£3.43 billion) a year earlier.

BP said the result included a net non-operating loss of $346 million (£170 million), compared with a net non-operating gain of $1.23 billion (£0.6 billion) for the third quarter of 2006.

Reported production for the third quarter and the first nine months of the year was 3,651 million barrels of oil per day (boepd) and 3,788 million boepd respectively, four per cent lower than in the equivalent periods of 2006. The fall was partially caused by the disruption to North Sea production which occurred after the central area transmission system (CATS) pipeline was shut in July as a result of damage.

In addition to lower oil and gas production, problems across BP's refinery business also dented the company's profits.

The replacement cost profit before interest and tax for BP's refining division was just $376 million (£185 million) during the third quarter, down from the $1,503 million (£739 million) reported for the corresponding period of 2006.

Outages at both BP's Whiting and Texas City refineries in the US have hit the company's performance, while the oil firm is still attempting to recover from the impact of the fatal blast that took place in Texas during 2005.

But BP, which has also suffered a series of leaks at its Prudhoe Bay oil field in Alaska, insisted that its major projects were "progressing well".

"In October we had first oil from Greater Plutonio in Angola, where BP holds a 50 per cent working interest. In the Gulf of Mexico we have started commissioning the Atlantis field," the company stressed.

BP said that it would pay its shareholders a quarterly dividend of 10.825 cents (4.95p) a share.