Anadarko, which has been streamlining its asset portfolio, said net income shrunk to $503 million, or $1.07 a share, from $1.39 billion, or $2.99 a share, a year ago.

Income from continuing operations in the most-recent period was $516 million, or $1.10 a share, down from $1.31 billion, or $2.83 a share, a year ago.

Excluding numerous special items for gains on asset sales, a restructuring charge and other one-time items, the company earned 70 cents a share, versus $1.60 a share a year ago.

Revenue in the July-September period fell nearly 14 percent to $3.03 billion from $3.51 billion in the year-ago period.

On average, analysts surveyed by Thomson Financial were looking for profit of 38 cents per share on revenue of $2.22 billion. That forecast typically excludes one-time items.

Anadarko bought Kerr-McGee Corp. and Western Gas Resources Inc. a little more than a year ago for more than $22 billion, and it's spent much of the past year reshaping its portfolio -- now geared toward natural gas -- by selling assets in the United States to reduce debt.

Since September 2006, the company, based in The Woodlands, a Houston suburb, has completed asset sales totaling $12.7 billion on an after-tax basis, a spokesman said.

"Our asset base continues to demonstrate repeatable and predictable characteristics that, along with exploration success, are the foundation of our value-creation strategy," Chairman and Chief Executive Jim Hackett said in a statement.

Production in the third quarter amounted to 47 million barrels of oil equivalent, down from 54 million barrels a year ago. Production from continuing operations a year ago was 49 million BOE.

Like others in the industry, Anadarko was hurt by lower natural gas prices in the quarter. The company said the average price of natural gas was $5.78 per thousand cubic feet, down from $9.93 a year ago.

Looking ahead, Anadarko said it was reaffirming the midpoint of its 2007 production guidance of 191 million BOE, while narrowing the range to 190 million to 192 million BOE. The company's previous range was 189 million to 193 million BOE.

Hackett said the company also has "additional confidence" in its ability to deliver 5 percent to 9 percent production growth from its retained properties in 2008 and beyond.

For the first nine months of 2007, Anadarko's net income was $3.63 billion, or $7.76 a share, versus $2.82 billion, or $6.09 a share, a year ago. Sales rose to $13 billion from $7 billion.

Anadarko shares fell 33 cents in after-hours trading Monday. They had gained 22 cents to end the regular session at $57.83.