Microsoft insists that Peter Jackson’s Halo project, dubbed Halo Chronicles, is merely “on hold.”

"Microsoft Game Studios is deeply committed to supporting and strategically growing the Halo franchise, and our relationship with Peter and his team is something that we greatly value,” the company told Joystiq. “Given the bandwidth of both of our companies we've decided to put this joint effort on hold and prioritise resources against other projects like Halo 3: ODST, Halo: Reach and Halo Legends."

However, Microsoft’s statement doesn’t tally with recent comments made by Jackson and his manager.

“That Halo project is no longer happening, it sort of collapsed when the movie didn't end up happening,” Jackson said of Chronicles, which was first announced in September 2006.

His manager, Ken Kamins, also told the LA Times that little progress had been made on Halo Chronicles before Microsoft axed the project in January amid company-wide cutbacks.

"They were scaling back everything, including the number of Halo games, and it just made sense at that point," he said.

Kamins added that Jackson’s Wingnut Interactive – a division of the director's New Zealand production company –is currently at work on new videogame projects.