TORONTO (Ticker) -- The hits just keep on coming for the NHL.

According to a report on Rogers Sportsnet of Canada's Web site Friday, cable sports giant ESPN has declined to exercise its $60 million option to televise NHL games for the 2005-06 season.

With the 2004-05 season canceled as a result of the lack of a collective bargaining agreement and ongoing labor meetings producing little progress toward resolving the dispute in time to resume play in the fall, ESPN may be seeking to work out a new deal at a much cheaper rate, according to the report.

An ESPN spokesman refused to confirm the report. SportsTicker is owned by ESPN.

Before their five-year, $600 million deal with the NHL expired at the end of the 2003-04 campaign, ESPN and ABC Sports reached a one-year agreement with options for the 2005-06 and 2006-07 seasons in May 2004.

While ESPN and ESPN2 covered a plethora of games during its previous contract, the new deal called for ESPN2 to air just 40 regular-season contests. The cable sports network also held exclusive rights to the conference finals and the first two games of the Stanley Cup Finals.

Commissioner Gary Bettman canceled the 2004-05 campaign on February 16, making the NHL the first major North American sports league to have an entire season wiped out due to a labor dispute.

In March, the league officially canceled the 2005 draft, which was slated to take place in Ottawa in June.

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