Despite netting acclaimed filmmaker Michael Apted to helm the next instalment, the Chronicles of Narnia series appears to have hit a major snag with Disney deciding to cut its ties as co-financier and co-producer.

"We are no longer going forward with the movie due to budgetary considerations and other logistics," a Disney spokeswoman has confirmed to industry newspapers Variety and Hollywood Reporter.

She offered no specifics on why the studio severed its ties with co-producer Walden Media, who had no comment.

Apted, the British director known for both award-winning dramas and documentary feature films, had been slated to begin shooting The Chronicles of Narnia: The Voyage of the Dawn Treader early in the new year, with a release slated for 2010.

The budget of the film was to be between $100 million-$150 million US, with young stars Georgie Henley, Skandar Keynes and Ben Barnes slated to return to the cast.

After the blockbuster release of the introductory installment, The Chronicles of Narnia: The Lion, the Witch and the Wardrobe in 2005, work on the subsequent movie — Prince Caspian — began almost immediately.

However, while the first film had an impressive international box office haul of $745 million US, Caspian followed with a lower $419 million US, Variety reported.

The Voyage of the Dawn Treader, originally published in 1952 as the third book in C.S. Lewis' seven-story series, sees central characters Lucy and Edmund Pevensie return with their cousin to the fantastical world of Narnia to join King Caspian for a grand naval quest.