Venture Production cut output estimates for the second time in four months and announced a slump in interim profits but chief executive Mike Wagstaff insisted the oil and gas independent had been making solid progress.

Venture, which specialises in bringing undeveloped North Sea finds into production, cut its forecasts for average daily production in 2007 by 4% to between 44,000 and 46,000 barrels oil equivalent per day (boepd).

In July, Venture also trimmed forecasts for 2007 output by 4% to between 46,000 and 48,000 boepd.

However, while his predecessor, Bruce Dingwall, departed in 2004 after repeated production disappointments, Wagstaff put a brave face on the latest setbacks.

Noting that the company had cut forecasts by less than 10% in total he said the reductions were caused by timing issues rather than fundamental problems with fields.

Production in the Greater Kittiwake Area was disrupted by severe weather in April. Gas from the Chiswick field was delayed from March to September because of equipment shortages and it took longer than expected to start pumping gas out of the Birch oil field.

By contrast, the Goosander, Annabel and Saturn fields had produced well ahead of expectations, confirming the quality of key reservoirs.

Wagstaff appeared unconcerned by the fact that pre-tax profits fell by 30%, to £67.7m in the six months to June, when revenues fell 16% to £155m.

Average production dropped 3% to 42,160 boepd but Wagstaff said the fall in earnings was largely due to a sharp drop in gas prices that was beyond company's control.

The average spot market price for gas slipped by 60% to 21p per therm compared with the record prices seen in the first half last year.

As most of Venture's production is gas, the fall in gas prices hit the company harder than firms that derive most of their revenue from selling oil, the effective realised price of which increased 14% to £30.75 boe.

Wagstaff rejected suggestions that Venture could have used hedging more effectively to limit the impact of falling prices.

"The spot price was down 60% for 60% of our production but revenues were down 16%; that's a pretty good performance in the circumstances. You can never hedge all your production."

Gas prices this month have been well above those recorded last September.

Noting that the start of production from the Chiswick gas field yesterday would boost production by 20%, Wagstaff said that the project had proved Venture's ability to "unlock difficult developments in mature basins such as the North Sea".

With a large portfolio of development and exploration assets Venture remains on track to meet its target of doubling average production from 30,000 to 60,000 boepd between 2006 and 2008.

After winning more than £200m backing from private equity firms 3i and Arclight and arranging £585m debt, Venture is keen to do more North Sea acquisitions.

"There is no need to go anywhere else, there's plenty to do in the North Sea," Wagstaff told The Herald.

Outgoing finance director Marie-Louise Clayton said Venture was looking at the big portfolio put up for sale by Shell and Exxon Mobil. Venture said that because of tax relief on exploration and development expenditure it did not anticipate being required to pay cash taxes until 2008.

However, it chose to pay £16m tax in January before it had to use capital allowances, saving £2m.