For San Francisco film lovers, we are pleased to present this story from “The Moving Picture.”

While the second installment in the Chronicles of Narnia series didn’t exactly blow the roof off the box office, I definitely didn’t see this coming. Disney has announced that for budgetary and logistical reasons it is not exercising its option to co-produce and co-finance the third Narina movie with Walden Media.

The third entry in the series, The Chronicles of Narnia: The Voyage of the Dawn Treader, based on the classic book by C.S. Lewis, was in preproduction and set for a spring shoot for a planned May 2010 release. This new development puts all of that in question.

Michael Apted (Amazing Grace, The World Is Not Enough) was on board to direct a script by Steven Knight and the key players of the second installment, Prince Caspian — Ben Barnes, Georgie Henley, William Moseley and Anna Popplewell — were set to return for the third film.

Walden has a strong relationship with the Lewis estate and will shop Treader in hopes of finding a new partner. According to the trades, the most likely candidate at this stage is Fox, which markets and distributes Walden fare under the Fox Walden banner.

The first film, The Lion, the Witch and the Wardrobe, was shot mostly in New Zealand for $180 million. Caspian, which filmed in the Czech Republic, Mexico and New Zealand, cost $200 million.

Lion grossed $292 million domestically and another $453 million internationally in 2005. Earlier this year, Prince Caspian made $141 million in North America and another $278 million internationally.

[Thank you for reading SFLuxe.com. This article was published today by The Moving Picture. We hope you enjoyed it!]