UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                    FORM 10-K


(Mark One)
[X]      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934

         For the fiscal year ended            December 31, 2000
                                   --------------------------------------------

                                       OR

[ ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES  EXCHANGE  ACT OF  1934

         For the transition period from ___________________to___________________


                         Commission file number 1-4668

                     COASTAL CARIBBEAN OILS & MINERALS, LTD.
          ------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

               BERMUDA                                           NONE
-------------------------------------------           -------------------------
    State or other jurisdiction of                        (I.R.S. Employer
     incorporation or organization                       Identification No.)

           Clarendon House
            Church Street
           Hamilton, Bermuda                                     HM 11
-------------------------------------------           -------------------------
 (Address of principal executive offices)                     (Zip Code)

Registrant's telephone number, including area code          (441) 295-1422
                                                      -------------------------

Securities registered pursuant to Section 12(b) of the Act:

                                                       Name of each exchange on
           Title of each class                              which registered
-------------------------------------------           -------------------------

  Common stock, par value $.12 per share                 Boston Stock Exchange

Securities  registered  pursuant to Section 12(g) of the Act:


                                      NONE
                                (Title of Class)

<PAGE>

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.
                                                          |X|  Yes       |_|  No

         Indicate by check mark if disclosure of delinquent  filers  pursuant to
Item 405 of Regulation S-K ss.229.405 of this chapter) is not contained  herein,
and will not be contained,  to the best of registrant's knowledge, in definitive
proxy or information  statements  incorporated  by reference in Part III of this
Form 10-K or any amendment to this Form 10-K.                               |X|

         The aggregate  market value of the common stock held by  non-affiliates
of the  registrant  was  approximately  $48,993,000  (U.S.) at March 9, 2001.

         Indicate the number of shares  outstanding of each of the  registrant's
classes of common stock, as of the latest practicable date:

         Common stock, par value $.12 per share,  43,468,329 shares  outstanding
as of March 9, 2001.

                       DOCUMENTS INCORPORATED BY REFERENCE

         Proxy Statement of Coastal  Caribbean Oils & Minerals,  Ltd. related to
the Annual Meeting of Shareholders  for the fiscal year ended December 31, 2000,
which is incorporated into Part III of this Form 10-K.
<PAGE>

                                TABLE OF CONTENTS

                                                                           Page

                                     PART I

Item 1.   Business                                                           4

Item 2.   Properties                                                        10

Item 3.   Legal Proceedings                                                 13

Item 4.   Submission of Matters to a Vote of Security Holders               17

                             PART II

Item 5.   Market for the Company's Common Stock and Related
          Stockholder Matters                                               18

Item 6.   Selected Consolidated Financial Information                       20

Item 7.   Management's Discussion and Analysis of Financial Condition
          and Results of Operations                                         21

Item 7A.  Quantitative and Qualitative Disclosures About Market Risk        24

Item 8.   Financial Statements and Supplementary Data                       25

Item 9.   Changes in and Disagreements with Accountants on
          Accounting and Financial Disclosure                               41

                            PART III

Item 10.  Directors and Executive Officers of the Company                   41

Item 11.  Executive Compensation                                            41

Item 12.  Security Ownership of Certain Beneficial Owners and Management    41

Item 13.  Certain Relationships and Related Transactions                    41

                             PART IV

Item 14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K   42

---------------------------

All monetary figures set forth are expressed in United States currency.

<PAGE>

                                     PART I

Item 1.  Business

    (a)  General Development of Business.

         Coastal Caribbean Oils & Minerals, Ltd.  (the  "Company"  or  "Coastal
Caribbean"), a Bermuda corporation,  has been engaged through its majority owned
subsidiary,  in the exploration for oil and gas reserves.  At December 31, 2000,
Coastal Caribbean's principal asset was its 59 1/4 % interest in its subsidiary,
Coastal Petroleum Company ("Coastal  Petroleum").  Coastal Petroleum's principal
assets are its nonproducing oil, gas and mineral leases and royalty interests in
the State of Florida.  Coastal  Petroleum has made no commercial  discoveries on
the lands covered by these leases.  At December 31, 2000, the amount of unproved
oil, gas and mineral  properties  totaled $4.8 million,  which costs the Company
expects to recover.

          Coastal Petroleum is the lessee under State of Florida leases relating
to the exploration for and production of oil, gas and minerals on  approximately
3,700,000 acres of submerged lands along the Gulf Coast and under certain inland
lakes and rivers.  The leases  provide for a working  interest in  approximately
1,250,000 acres and a royalty interest in approximately  2,450,000 acres covered
by the leases.  Coastal  Petroleum  has made no  commercial  discoveries  on its
leaseholds.

         In 1990,  the  State of  Florida  enacted  legislation  that  prohibits
drilling or exploration for oil or gas on Florida's  offshore acreage.  Although
the law does not apply to areas where  Coastal  Petroleum is entitled to conduct
exploration,  the State of Florida has  effectively  prevented  any  exploratory
drilling  by  denying  the  Company's  applications  for  drilling  permits.  In
addition,  in those areas where Coastal  Petroleum has only a royalty  interest,
the law also  effectively  prohibits  production  of oil and gas,  rendering  it
impossible for Coastal Petroleum to collect  royalties from those areas.  During
1998,  Coastal  Petroleum  exhausted its legal remedies in its efforts to obtain
compensation for the drilling prohibition on its royalty interest acreage.

         Coastal Petroleum has been involved in various lawsuits for many years.
Coastal Petroleum's  current litigation (the "Florida  Litigation") now involves
one basic claim:  whether the State's denial of a permit constitutes a taking of
its property. In addition, Coastal Caribbean is a party to one additional action
in which Coastal  Caribbean  claims that certain of its royalty  interests  have
been  confiscated by the State.  During 2000, the Company  actively  pursued the
Florida Litigation.

         On October 6, 1999,  the Florida First  District  Court of Appeal ruled
that the DEP has the authority to deny Coastal  Petroleum's  drilling permit for
its St. George Island prospect,  provided that Coastal  Petroleum  receives just
compensation  for what has been taken.  The State of Florida and certain Florida
environmental groups filed on November 1, 1999 a joint motion for clarification,
rehearing,  or certification with respect to that decision,  asking the Court of
Appeal,  among other  things,  to clarify that the question of whether there has
been a taking of Coastal  Petroleum's leases should be determined in the Circuit
Court.  On June 26, 2000, the Court of Appeal denied all of the State's  motions
and stated that the issue of whether the denial of a permit constituted a taking
was not before the Court. The Court declined to rule on the merits of the taking
issue and stated that the issue was a matter for the Circuit  Court.  On January
16, 2001, Coastal Petroleum filed an inverse  condemnation action in the Circuit
Court  to be  compensated  for the  value  of its  properties.  The  cost of the
litigation is expected to be substantial.

         In  1997,  Coastal  Petroleum  filed  12  additional  applications  for
drilling  permits.  Coastal  Petroleum  had  objected  to certain  requests  for
additional   data  by  the  State  of  Florida  DEP.  On  March  26,  1999,   an
administrative  law judge  upheld the DEP's  requirements.  The  decision of the
administrative  law judge was affirmed by the First  District Court of Appeal on
February 29, 2000.

         In order  to more  fully  permit  the  Apalachicola  Reef  Play,  which
includes the St. George Island prospect,  on October 29, 1998, Coastal Petroleum
filed four additional permit  applications  (1310-1313).  The DEP also requested
additional data for these  applications.  Although these  applications are still
pending,  Coastal  Petroleum  does not  believe  the DEP will ever  grant  these
permits.

         During December 1998, the DEP began the administrative process to adopt
new rules regarding offshore drilling in Florida. Coastal Petroleum, which holds
the only leases offshore,  and other interested parties have submitted comments.
The DEP is still in the process of drafting the new rules.

See Item 3."Legal Proceedings" for a more complete discussion of the litigation.

         (b)      Financial Information About Industry Segments.
                  ---------------------------------------------

                  Because the Company is engaged in only one  industry,  namely,
oil, gas and mineral exploration and development, this item is not applicable to
the  Company.  See  Item 8 for  general  financial  information  concerning  the
Company.

         (c)      Narrative Description of the Business.
                  -------------------------------------

                  Coastal  Caribbean  was  organized  in Bermuda on February 14,
1962. The Company is the successor to Coastal Caribbean Oils, Inc., a Panamanian
corporation  organized on January 31, 1953 to be the holding company for Coastal
Petroleum Company.

                  Coastal Petroleum caused oil and gas exploration to take place
on its leases prior to the  beginning of  litigation  in 1968 but has  conducted
more  limited  exploration  since  that time.  Coastal  Petroleum  believes  all
drilling and exploration  obligations  imposed by its leases have been satisfied
to  date.  No  commercial  oil  or gas  discoveries  have  been  made  on  these
properties; therefore, the Company has no proved reserves of oil and gas and has
had no production. See Item 2. "Properties."


                  (i)      Principal Products.
                           ------------------

                           Not applicable.

                  (ii)     Status of Product or Segment.
                           ----------------------------

                           Not applicable.

                  (iii)    Raw Materials.
                           -------------

                           Not applicable.

                  (iv)     Patents, Licenses, Franchises and Concessions Held.
                           --------------------------------------------------

                           See Item 2. "Properties."

                           The  acreage  covered by Coastal  Petroleum's  leases
is located for the most part along  offshore  areas on the Gulf Coast of Florida
and in submerged and unsubmerged lands under certain bays, inlets, riverbeds and
lakes,  of which Lake  Okeechobee is the largest.  Coastal  Petroleum  currently
makes an annual lease payment of $59,247 to the State of Florida.
                  (v)      Seasonality of Business.
                           -----------------------

                           The Company's business is not seasonal.

                  (vi)     Working Capital Items.

                           The  majority  of the  Company's  current  assets
are in the form of cash and cash equivalents.  See Item 8. "Financial Statements
and Supplementary Data."

                  (vii)    Customers.
                           ---------

                           Not applicable.

                  (viii)   Backlog.
                           -------

                           Not applicable.

                  (ix)     Renegotiation of Profits or Termination of Contracts
                            or Subcontracts at the Election of the Government.
                           --------------------------------------------------

                           Not applicable.

                  (x)      Competitive Conditions in the Business.
                           --------------------------------------

                           Competition  in the oil and gas  industry is intense.
The  Company  must  compete  with  companies  which have  substantially  greater
resources  available to them. In addition,  the industry as a whole must compete
with other  industries in supplying the energy needs of commerce and the general
public.  Furthermore,  competitive  conditions may be substantially  affected by
energy legislation which may be adopted from time to time. It is not possible to
predict the nature of any such  legislation  which may  ultimately be adopted or
its effects upon the future operations of the Company.

                  (xi)     Research and Development.
                           ------------------------

                           Not applicable.

                  (xii)    Environmental Regulation.
                           ------------------------

                           The  operations  of  Coastal  Caribbean  and its
right to obtain  interests  in and hold properties  or to do  business  may be
affected  to an  unpredictable  extent by limitations imposed by the laws and
regulations which are now in effect or which may be  adopted  by the
jurisdictions  in  which  the  Company  carries  on its business.  Further
measures that have been or might be imposed include increased bond requirements,
conservation,  proration,  curtailment,  cessation or other forms of limiting or
controlling production of hydrocarbons or minerals, as well as price controls or
rationing or other similar  restrictions.  In  particular, environmental control
and energy  conservation laws and regulations  adopted by federal, state and
local  authorities  may  have  to  be  complied  with  by leaseholders  such as
Coastal  Petroleum.  However,  there are  legal  remedies available  to the
Company  if these  laws and  regulations  are  excessive  and overreaching
(see Item 3 "Legal  Proceedings"  for a discussion  of the Florida Litigation).
It is not possible to predict the nature of any further legislation or
regulation  that might  ultimately be adopted or its effects upon the future
operations of Coastal Caribbean or Coastal Petroleum.

                  (xiii)   Number of Persons Employed by Registrant.
                           ----------------------------------------

                           The Company  currently has two  employees.  The
Company  relies  heavily on  consultants for legal, accounting,  geological and
administrative services. The Company uses consultants  because it is more cost
effective than employing a larger full timestaff.

         (d)      Financial Information About Foreign and Domestic Operations
                  and Export Sales.

                  (1)      Identifiable Assets.
                           -------------------

                           All of the Company's assets are located in the United
States.  See Item 1(a) "General Development of Business."

                           Since the  Company is a  development  stage  company,
the  balance  of the  information required under this paragraph is not
applicable to the Company.  See Item 8.

                  (2)      Risks Attendant to Foreign Operations.
                           -------------------------------------

                           Not applicable.

                  (3)      Data which are not Indicative of Current or Future
                           Operations.
                           ----------------------------------------------------

                           Not applicable.

The following  graphic  presentation  has been  omitted,  but the following is a
description of the omitted material:



             Map showing Coastal Lease Areas in the State of Florida


Item 2.  Properties

Properties

         The discussion herein relating to the Company's properties is qualified
in its entirety by the discussion in Item 3 "Legal Proceedings"  relating to the
Florida Litigation.

         Coastal  Petroleum,  a  Florida  corporation,   holds  certain  working
interests in  nonproducing  oil, gas and mineral leases  covering  approximately
1,250,000 acres, and a royalty interest in approximately 2,450,000 acres, in and
offshore the State of Florida.  No commercial oil or gas  discoveries  have been
made on the  properties  covered by these  leases and Coastal  Petroleum  has no
proved reserves of oil or gas and has had no significant production. At December
31, 2000,  the amount of unproved oil, gas and mineral  properties  totaled $4.8
million, which costs the Company expects to recover.

         In 1941,  Arnold Oil  Explorations,  Inc.,  renamed  Coastal  Petroleum
Company in 1947,  entered  into a contract  with the  Trustees  of the  Internal
Improvement Trust Fund of the State of Florida (the  "Trustees"),  in whom title
to publicly owned lands in the State of Florida,  including  bottoms of salt and
fresh  waters,  is  irrevocably  vested,  for the  exploration  of oil,  gas and
minerals on such lands.  Pursuant  to an option to lease in this  contract,  the
Trustees and Coastal  Petroleum entered into three leases between 1944 and 1946.
The acreage  covered by these leases is located for the most part along offshore
areas on the Gulf Coast of Florida and in submerged  lands under  certain  bays,
inlets, riverbeds and lakes, of which Lake Okeechobee is the largest.

         In 1968, Coastal Petroleum sued the Secretary of the Army of the United
States in a dispute  regarding  certain mineral rights. In 1969, as part of that
litigation,  the  Trustees  claimed  that the leases  were  invalid and had been
forfeited.  Coastal  Petroleum and the Trustees  settled their  disagreement  in
1976.

         Under the terms of the 1976 settlement agreement, the two leases (224-A
and 224-B) bordering the Gulf Coast were divided into three areas,  each running
the entire length of the coastline from Apalachicola Bay to the Naples area: (1)
The inner area,  including rivers,  bays, and harbors,  extends seaward from the
Florida shoreline a distance of 4.36 statute miles (5,280 feet per statute mile)
into the Gulf,  covers  approximately  2.25 million  acres,  and is subject to a
royalty interest payable to Coastal Petroleum. This interest is a 6 1/4% royalty
on the  wellhead  value of all oil and gas,  25  cents  per long ton on  sulfur,
receivable in cash or in kind at Coastal Petroleum's option, and a 5% royalty on
production  or the market value of other  minerals.  (2) The middle area,  three
statute miles wide and covering more than 800,000 acres, was released by Coastal
Petroleum to the Trustees,  and Coastal Petroleum has no further interest in the
area.  (3)  Coastal  Petroleum  presently  owns a 100%  working  interest in the
outside  area,  which  extends  seaward an  additional  three  statute miles and
borders federal offshore acreage.  This area,  exceeding 800,000 acres,  remains
subject to royalties  payable to the State of Florida of 12 1/2% on oil and gas,
$.50 per long ton of sulfur and 10% on other minerals.  The Florida  legislature
has enacted statutes designed to protect the Big Bend Seagrass Aquatic Preserve,
an area  covering  approximately  one  quarter  of Coastal  Petroleum's  working
interest area.  However,  the legislation and legislative  history recognize and
preserve Coastal Petroleum's prior rights as granted by the leases.

         Coastal  Petroleum retains a 100% working interest in 450,000-acre Lake
Okeechobee  which is a part of Lease 248 and which is also  subject to royalties
payable to the State of Florida of 12 1/2% on oil and gas,  $.50 per long ton of
sulfur and 10% on other  minerals.  Pursuant to its settlement with the State of
Florida in 1976, Coastal Petroleum agreed not to conduct  exploration,  drilling
or mining operations on Lake Okeechobee without the prior approval of the State.
As to the balance of this lease,  covering  approximately 200,000 acres, Coastal
Petroleum  retains royalty  interests of 6 1/4% on oil, gas and sulfur and 5% on
other minerals.

         Under the 1976 settlement agreement with the Trustees, the three leases
have a term of 40 years  beginning  from January 6, 1976 and require the payment
of an annual  rental of $59,247,  if oil, gas or minerals are being  produced in
economically sustainable quantities at January 6, 2016, these operations will be
allowed to  continue  until they  become  uneconomic.  Further,  the  settlement
agreement  provides that the drilling  requirements shall be governed by Chapter
20680, Laws of Florida,  Acts of 1941, and that all other drilling  requirements
are waived.  Under the 1941 Act, a lessee is required to drill at least one test
well on lands  leased in each  five-year  period  under  the term of the  lease.
Coastal   Petroleum   believes  it  is  current  in   fulfilling   its  drilling
requirements.  Drilling  requirements of Lease 224-A have been satisfied through
the five year  obligation  period ended August 2, 2004. The State of Florida has
refused Coastal Petroleum the right to drill on Lease 248 since August 10, 1986.
Drilling  requirements  of Lease 224-B had been satisfied  through the five year
obligation  period ended October 31, 2000. On July 21, 2000,  Coastal  Petroleum
filed  applications for permits to drill a series of shallow test wells on Lease
224-B which were completed prior to October 31, 2000.

         The following charts reflect the acreage and annual rental  obligations
resulting  from  the  1976  settlement  agreement  with  the  Trustees  and  the
approximate acreage under lease at December 31, 2000:

                    Current                   Current                 Current
                    Working                   Royalty                 Annual
Lease              Interest                  Interest                 Rental
-----              --------                  --------                 ------
224-A and 224-B      800,000                2,250,000                $39,261
248                  450,000                  200,000                 19,986
                  ----------               ----------               --------
                   1,250,000                2,450,000                $59,247
                   =========                =========                =======




                Acreage under lease at December 31, 2000

                           Gross Acres (*)                    Net Acres (**)
                 -------------------------------  ------------------------------
                     Undeveloped      Developed      Undeveloped      Developed
                     -----------      ---------      -----------      ---------
Working interest        1,250,000        -0-           1,250,000         -0-
Royalty interest        2,450,000        -0-             153,125         -0-
                        ---------       -----           --------        -----
    Total               3,700,000        -0-            1,403,125        -0-
                        =========    ============       =========    ===========

*        A gross acre is an acre in which a working interest is owned.
**       A net acre is  deemed  to exist  when the sum of  fractional  ownership
         working interests in gross acres equals one. The number of net acres is
         the sum of the  fractional  working  interests  owned  in  gross  acres
         expressed as whole numbers and fractions thereof.

Disclosure Concerning Oil and Gas Operations.

         Since the properties in which the Company has interests are undeveloped
and nonproducing,  items 2 through 4 of Securities Exchange Act Industry Guide 2
are not applicable.

(5)      Undeveloped Acreage.
         -------------------

         The  Company's  undeveloped  acreage  as of  December  31,  2000 was as
follows:

                                 Gross Acres           Net Acres

          Working Interest         1,250,000           1,250,000
          Royalty Interest         2,450,000             153,125
                                   ---------            --------
          Total                    3,700,000           1,403,125
                                   =========           =========

(6)       Drilling Activity.
          -----------------

         On July 21, 2000,  Coastal Petroleum filed  applications for permits to
drill a series of shallow test wells on Lease 224-B Coastal Petroleum which were
completed prior to October 31, 2000.
 .
 (7)      Present Activities.
          ------------------

          None

 (8)      Delivery Commitments.

          None.
Item 3.           Legal Proceedings

         Coastal Petroleum has been involved in various lawsuits for many years.
Coastal Petroleum's current litigation now involves one basic claim: whether the
State's  denial of a permit  constitutes a taking of its property.  In addition,
Coastal Caribbean is a party to another action in which Coastal Caribbean claims
that certain of its royalty interests have been confiscated by the State. During
2000, the Company actively pursued the Florida Litigation.

Coastal  Petroleum  Company,  Plaintiff  vs.  State of  Florida,  Department  of
Environmental  Protection,  and Board of  Trustees of the  Internal  Improvement
Fund, Defendants. Lease Taking Case.

         On January 16, 2001, Coastal Petroleum Company filed a complaint in the
Leon  County  Circuit  Court,  Florida  against  the  State of  Florida  seeking
compensation  for the State's  taking of its property  rights to explore for oil
and gas within its state Lease 224-A .

     On February 13, 2001,  certain  holders of  royalties  pertaining  to Lease
224-A filed a Motion to Intervene as  Additional  Plaintiffs.  A hearing on that
motion is scheduled to be held by the court on March 29, 2001.

     On March 5, 2001, the State filed a Motion to Dismiss Coastal Petroleum's
complaint.  A hearing  on that  motion is  scheduled  to be held by the court on
April 26, 2001.

Coastal Petroleum Company v. State Department of Environmental  Protection,(Case
No. 98-1998, First District Court of Appeal). Drilling Permit Litigation.

         In  1992,  Coastal  Petroleum  applied  to the  Florida  Department  of
Environmental  Protection  (the "DEP") for a permit to drill an exploratory  oil
and gas well off Apalachicola, Florida. The proposed well would be located in an
area included within Lease 224-A.  The DEP  subsequently  denied the application
for issuance of a drilling permit for various reasons and imposed a $1.9 billion
bond.  Coastal  Petroleum  appealed the actions of the DEP to the Florida  First
District Court of Appeal  ("Court of Appeal").  After two decisions by the Court
of Appeal in favor of Coastal Petroleum,  the Florida Supreme Court in July 1996
denied the DEP's petition to review an April 1996 Court of Appeal decision.  The
Florida  Supreme  Court had also  refused to review an  earlier  Court of Appeal
decision.

         On August 16, 1996,  the DEP  notified  Coastal  Petroleum  that it was
prepared to issue the drilling permit subject to Coastal Petroleum  publishing a
Notice of Intent to Issue ("Notice") the permit.  The Notice allowed  interested
parties to request administrative hearings on the permit.

         On May 28, 1997,  the Oil and Gas Drilling  Bill (SB550) was enacted in
Florida.  The  legislation  requires  that a surety  be  based on the  projected
cleanup costs and possible  natural  resource  damage  associated  with offshore
drilling  as  estimated  by the DEP  and as  established  by the  Administration
Commission (the "Commission")  which is comprised of the Governor of Florida and
the  Cabinet.  Previously,  the  required  surety was  satisfied by a payment of
$4,000 to the Mineral Trust Fund in the first year,  with a maximum  $30,000 per
year and a payment of $1,500 per well for each subsequent  year. On September 9,
1997,  the  State of  Florida  set a new  surety  amount of $4.25  billion  as a
precondition for the issuance of the drilling permit.

         On  October  20,  1997,  a public  hearing  on the  permit  application
convened and concluded on November 6, 1997.  The hearing  included the Company's
appeal of the $4.25  billion  surety  requirement.  On April 8, 1998,  a Florida
Administrative  Law Judge  recommended that Coastal  Petroleum was entitled to a
drilling permit with the requirement of a $225 million surety.  On May 13, 1998,
the Commission  rejected the $225 million surety and remanded the proceedings to
the Administrative Law Judge with instructions to recalculate the surety amount.

         On May 22,  1998,  the DEP denied the  permit to Coastal  Petroleum  to
drill an offshore  exploration well near St. George's Island.  Coastal Petroleum
appealed  both the  denial of the  permit by the DEP and the  imposition  of the
surety to the Court of Appeal.

         On  October  6,  1999,  the Court of Appeal  ruled that the DEP has the
authority to deny Coastal Petroleum's  drilling permit for its St. George Island
prospect,  provided that Coastal  Petroleum  receives just compensation for what
has been taken.  The State of Florida and certain Florida  environmental  groups
filed on  November  1, 1999 a joint  motion  for  clarification,  rehearing,  or
certification with respect to that decision,  asking the Court of Appeal,  among
other things, to clarify that the question of whether there has been a taking of
Coastal  Petroleum's  leases should be determined in the Circuit Court.  On June
26, 2000, the Court of Appeal denied all of the State's  motions and stated that
the issue of whether  the  denial of a permit  constituted  a  "taking"  was not
before the Court.  The Court  declined to rule on the merits of the taking issue
and stated  that the issue was a matter for the  Circuit  Court.  On January 16,
2001,  Coastal  Petroleum  Company filed a complaint in the Leon County  Circuit
Court, Florida against the State of Florida seeking compensation for the State's
taking of its property  rights to explore for oil and gas within its state Lease
224-A .

Coastal  Petroleum  Company v. State of  Florida,  Department  of  Environmental
Protection (DOAH Case Nos. 98-1901-1912).  (DCA Case 1999-2112) and Other Permit
Applications.

         On February 25, 1997 Coastal Petroleum filed 12 additional applications
for  drilling  permits.  Coastal  Petroleum  objected  to certain  requests  for
additional  data by the Florida DEP. On March 26, 1999,  an  administrative  law
judge  upheld the DEP's  requirements.  The decision of the  administrative  law
judge was affirmed by the First District Court of Appeal on February 29, 2000.

         In order  to more  fully  permit  the  Apalachicola  Reef  Play,  which
includes the St. George Island prospect,  on October 29, 1998, Coastal Petroleum
filed four additional permit  applications  (1310-1313).  The DEP also requested
additional data for these  applications.  Although these  applications are still
pending,  Coastal  Petroleum  does not  believe  the DEP will ever  grant  these
permits.


Cottingham  v. State of Florida,  (Case No.  94-768-CA-01,  Circuit Court of the
Second Judicial Circuit in Leon County). Coastal Caribbean Royalty Litigation.

         The  offshore  areas  covered by Coastal  Petroleum's  original  leases
(prior to the 1976  Settlement  Agreement)  are subject to certain other royalty
interests held by third parties,  including Coastal Caribbean.  Several of those
third parties,  including Coastal Caribbean,  have instituted a separate lawsuit
against the State. That lawsuit claims that the royalty holders'  interests have
been  confiscated as a result of the State's  actions  discussed  above and that
they are entitled to compensation for that taking.

         The royalty holders were not parties to the 1976 Settlement  Agreement,
and the royalty  holders  contend that the terms of the Settlement  Agreement do
not insulate the State from taking claims by those royalty holders.  The case is
currently pending before the Circuit Court in Tallahassee.  On December 2, 1999,
the Circuit Court denied the State's motion to dismiss the plaintiffs'  claim of
inverse condemnation but dismissed several other claims.

         On May 10, 2000,  the State filed a motion for summary  judgment but no
hearing date has been set for the motion. Discovery is proceeding.

         Any recovery made in the royalty holders' lawsuit would be shared among
the various  plaintiffs in that lawsuit,  including Coastal  Caribbean,  but not
Coastal Petroleum.

Counsel

         The Tampa,  Florida law firm of Gaylord Merlin  Ludovici Diaz & Bain is
Coastal  Petroleum's  principal  trial  counsel in Coastal  Petroleum's  inverse
condemnation  claim against the State of Florida in Florida  Circuit Court.  Mr.
Cary Gaylord is the lead attorney for Gaylord Merlin.  Mr. Gaylord,  age 54, has
extensive experience in eminent domain and property rights matters. He is a 1969
graduate  of the United  States  Military  Academy  and a 1974  graduate  of the
University of Florida Law School.

         In addition, Mr. Robert J. Angerer of Angerer & Angerer of Tallahassee,
Florida is assisting Gaylord Merlin in the litigation. Mr. Angerer, age 54, is a
1969  graduate of the  University  of Michigan  and received his law degree with
high honors from Florida State University in 1974.

Statutory Attorneys' Fees

         Chapter 73 of Florida law provides in eminent domain proceedings (which
would include Coastal  Petroleum's  taking claim) that, in addition to the award
made to the property owner,  the court shall award  attorneys' fees based on the
difference  between the final judgment or settlement and the first written offer
made to the  property  owner by the  State  in  accordance  with  the  following
schedule:

         1.       Thirty-three percent of any difference up to $250,000; plus
         2.       Twenty-five percent of any portion of the difference between
                  $250,000 and $1 million; plus
         3.       Twenty percent of any portion of the difference exceeding
                  $1 million.

Contingency Fees

         Coastal Petroleum has agreed to pay an aggregate of 8.65% in contingent
fees based on any net recovery from execution on or  satisfaction of judgment or
from settlement of the Florida litigation to the following:

              Holder                              Percentage
              ------                              ----------
       Reasoner, Davis & Fox                            2.00
         Robert J. Angerer                              1.50
         Benjamin W. Heath                              1.25
          Phillip W. Ware                               1.25
        Murtha Cullina LLP                              1.00
      Ausley & McMullen, P.A.                            .75
          James R. Joyce                                 .30
        Arthur B. O'Donnell                              .30
         James J. Gaughran                               .30
                                                         ---
               Total                                    8.65
                                                        ====

         In  addition,  Coastal  Petroleum  has agreed to pay  Gaylord  Merlin a
contingent fee equal to the greater of:

         (b)      approximately  90% of  the  statutory  award  of  attorneys'
                  fees (discussed above), less the hourly fees paid to Gaylord
                  Merlin, or

         (b)      ten  percent of the first $100  million or portion  thereof of
                  the compensation  received by Coastal Petroleum from the State
                  as  compensation  for the  taking of its  property,  plus five
                  percent of such  compensation in excess of $100 million,  less
                  the hourly fees paid to Gaylord  Merlin and other costs of the
                  litigation.


Uncertainty

         At  December  31,  2000,  the amount of unproved  oil,  gas and mineral
properties  totaled $4.8  million,  which costs the Company  expects to recover.
However,  no assurances can be given that Coastal Petroleum or Coastal Caribbean
will  prevail  on any of the  issues  set forth  above,  that they will  recover
compensation for any of their claims, or that a drilling permit will be granted.
In  addition,  even if  Coastal  Petroleum  were to prevail on any or all of the
issues to be  decided,  no  assurance  can be given that  Coastal  Caribbean  or
Coastal Petroleum will have sufficient financial resources to survive until such
decisions  become  final or to drill any wells for which  permits are  received.
There is also no assurance that any wells drilled will be successful and lead to
production of any oil or gas in commercial quantities.


Item 4.           Submission of Matters to a Vote of Security Holders

                  None.

Executive Officers of the Company

          The following  information  with respect to the executive  officers of
the Company is furnished  pursuant to Instruction 3 to Item 401(b) of Regulation
S-K.

<TABLE>
<CAPTION>
                                                                                       Other Positions
                                      Office            Length of Service               Held With The
          Name         Age             Held               as an Officer                   Company
          ----         ---           --------        -----------------------         ------------------
<S>                    <C><C>                              <C>            <C>

Benjamin W. Heath      86            President             Since 1953      Director

Phillip W. Ware        51         Vice President           Since 1982      Director, President of Coastal
Petroleum

James R. Joyce         60 Treasurer, Assistant Secretary   Since 1994      Secretary/Treasurer of Coastal
Petroleum                   and Chief Financial Officer
</TABLE>

         All  officers  of the  Company  are  elected  annually  by the Board of
Directors and serve at the pleasure of the Board of Directors.

         The Company is not aware of any arrangements or understandings  between
any of the  individuals  named  and any  other  person  pursuant  to  which  any
individual named above was selected as an officer.

<PAGE>

                                     PART II

Item 5.  Market for the Company's Common Stock and Related
                  Stockholder Matters

         (a)      Market Information.

         The principal market for the Company's common stock is the Boston Stock
Exchange  under  the  symbol  CCO.  The  common  stock  is  also  traded  in the
over-the-counter  market on the  "Electronic  Bulletin  Board"  of the  National
Association of Securities Dealers, Inc. under the symbol COCBF.OB. The quarterly
high and low closing  prices on the Boston  Stock  Exchange  during the last two
years were as follows:
-------------------------------------------------------------------------------

2000       1st quarter      2nd quarter      3rd quarter       4th quarter
----       -----------      -----------      -----------       -----------

High          1.19             1.19             2.50              1.13
Low           0.88             0.53             1.00              0.69
-------------------------------------------------------------------------------

1999       1st quarter      2nd quarter      3rd quarter       4th quarter
----       -----------      -----------      -----------       -----------

High          1.88             2.00             1.81              2.06
Low           1.00             1.50             1.31              1.06
-------------------------------------------------------------------------------

         (b)      Holders.

         The approximate  number of record holders of the Company's common stock
at March 9, 2001 was approximately 9,000.

         (c)      Dividends.

         The Company has never  declared or paid  dividends  on its common stock
and it does not anticipate  declaring or paying any dividends in the foreseeable
future.  The  Company  plans  to  retain  any  future  earnings  to  reduce  the
accumulated  deficit of  $28,747,000  at  December  31,  2000 and to finance our
operations.

         The Company's  Memorandum of Association and Bye-laws do not permit the
Company to repurchase or redeem shares of its common stock.

         Foreign Exchange Control Regulations

         The Company is subject to the applicable laws of The Islands of Bermuda
relating to exchange  control,  but has the  permission of the Foreign  Exchange
Control of Bermuda to carry on business in, to receive, disburse and hold United
States  dollars  and dollar  securities  under its  designation  as an  External
Account Company.  The Company has been advised that, although as a matter of law
it is possible for such designation to be revoked, there is little precedent for
revocation under Bermuda law.

         Taxes

         Coastal Caribbean is a Bermuda  corporation.  Bermuda currently imposes
no taxes on corporate income or capital gains realized  outside of Bermuda.  Any
amounts  received by Coastal  Caribbean from United States sources as dividends,
interest,  or other fixed or determinable annual or periodic gains,  profits and
income, will be subject to a 30% United States withholding tax. In addition, any
dividends from its domestic subsidiary,  Coastal Petroleum, will not be eligible
for the 100% dividends received  deduction,  which is allowable in the case of a
United States parent corporation.  Shares of the Company held by persons who are
citizens or  residents  of the United  States are subject to federal  estate and
gift and local inheritance taxation. Any dividends received by such persons will
also be subject to federal, State and local income taxation. The foregoing rules
are of general application only, and reflect law in force as of the date of this
report.

         A convention  between  Bermuda and the United States relating to mutual
assistance on tax matters became operative in 1988.

(d)      Recent Sales of Unregistered Securities.

         None.
<PAGE>

Item 6.  Selected Consolidated Financial Information

         The  following  selected  consolidated  financial  information  for the
Company  insofar as it  relates  to each of the five  years in the period  ended
December 31, 2000 has been extracted from the Company's  consolidated  financial
statements.


<TABLE>
<CAPTION>

                                           2000             1999             1998             1997            1996
                                            ($)              ($)              ($)             ($)              ($)

<S>                                     <C>              <C>              <C>             <C>              <C>
Net loss                                 (1,386,000)      (1,105,000)      (1,155,000)      (1,611,000)     (1,148,000)
                                         ===========      ===========      ===========      ===========     ===========

Common stock shares outstanding          40,844,000       40,056,000       40,056,000       40,056,000      37,478,000
                                         ==========       ==========       ==========       ==========      ==========
(average)

Net loss per share (basic and diluted)         (.03)            (.03)            (.03)            (.04)           (.03)
                                               ====             ====             =====            =====           =====

Cash   and  cash   equivalents   and
marketable securities                     2,959,000        1,042,000        2,181,000        3,749,000       5,789,000
                                          =========        =========        =========        =========       =========


Unproved oil, gas and, mineral
properties (full cost method)
                                          4,808,000        4,760,000        4,736,000        4,395,000       3,944,000
                                          =========        =========        =========        =========       =========


Total assets                              8,160,000        6,207,000        7,311,000        8,462,000      10,021,000
                                          =========        =========        =========        =========      ==========

Shareholders' equity:
  Common stock                            5,216,000        4,807,000        4,807,000        4,807,000       4,805,000
  Capital in excess of par value         31,498,000       28,693,000       28,693,000       28,693,000      28,443,000
  Accumulated deficit                   (28,747,000)     (27,362,000)     (26,256,000)    (25,102,000)     (23,490,000)
                                        ------------     ------------     ------------    ------------     ------------
Total shareholders' equity                7,967,000        6,138,000        7,244,000        8,398,000       9,758,000
                                          =========        =========        =========        =========       =========
</TABLE>

<PAGE>

Item 7.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations

(1)      Liquidity and Capital Resources

         Statements   included  in  Management's   Discussion  and  Analysis  of
Financial Condition and Results of Operations which are not historical in nature
are intended to be, and are hereby  identified as, "forward looking  statements"
for  purposes  of the  "Safe  Harbor  Statement"  under the  Private  Securities
Litigation Reform Act of 1995. The Company cautions readers that forward looking
statements  are  subject to certain  risks and  uncertainties  that could  cause
actual results to differ  materially from those indicated in the forward looking
statements. Among the risks and uncertainties are:

         1.       the  uncertainty of any decision  favorable to Coastal
                  Petroleum in its  litigation  against the State of Florida;

         2.       the substantial cost of continuing the litigation;

                              Short Term Liquidity

         At December 31 2000,  Coastal Caribbean had approximately $3 million of
cash and cash  equivalents and marketable  securities  available and this amount
should be sufficient to fund the  Company's  operations in the year 2001.  These
funds are  expected to be used for general  corporate  purposes,  including  any
required  exploration and development and to continue the litigation against the
State of Florida.


                               Long Term Liquidity

         On January 16, 2001, Coastal Petroleum Company filed a complaint in the
Leon  County  Circuit  Court,  Florida  against  the  State of  Florida  seeking
compensation  for the State's  taking of its property  rights to explore for oil
and gas within its state Lease 224-A.  The Company  expects that the cost of the
litigation will be substantial.  If the litigation is prolonged, the Company may
be required to seek additional financing.


(2)      Results of Operations

         The Company has never had  substantial  revenues  and has operated at a
loss each year since its  inception  in 1953.  The Company has been  involved in
litigation  since 1968 and its total Florida  Litigation  related  expenses have
been approximately $1.6 million during the three years ended December 31, 2000.




2000 vs. 1999

         The Company recorded a loss of $1,386,000 for 2000,  compared to a loss
of $1,105,000 in 1999.

         Interest income and other income  increased 13% to $63,000 in 2000 from
$55,000 in 1999 because more funds were  available  for  investment  during 2000
after the Company's sale of common stock was completed in October 2000.

         Legal fees and costs  increased  56% in 2000 to  $634,000  compared  to
$405,000 in 1999 because in 2000 the Company  prepared its  complaint to file in
the Florida Circuit Court to claim that the Company's Lease 224-A had been taken
by the State of Florida.  The Company  also  recorded a noncash  charge to legal
expense  in the amount of $75,000 in  connection  with the  issuance  of a stock
option grant in 2000.

         Administrative  expenses increased 13% during 2000 to $535,000 compared
to $474,000 in 1999.  During December 1999, the Company  increased its Directors
and Officers  liability  insurance  coverage  from $6.2 million to $12.2 million
which increased insurance costs.

         Salaries  decreased  4% to $152,000  during  2000  compared to $158,000
during 1999. An employee who has not been replaced left the Company during 1999.

         Shareholder  communications  increased  5%  from  $103,000  in  1999 to
$108,000 in 2000 because of the cost of various listing fees.

         Exploration costs decreased 6% from $21,000 in 1999 to $20,000 in 2000.
These  miscellaneous   exploration  expenses  do  not  include  the  exploration
expenditures totaling $48,000 that were capitalized in 2000 ($24,000 in 1999).

1999 vs. 1998

         The Company recorded a loss of $1,105,000 for 1999,  compared to a loss
of $1,155,000 in 1998.

         Interest income and other income  decreased 67% to $55,000 in 1999 from
$167,000 in 1998 because less funds were available for investment during 1999.

         Legal fees and costs  decreased  19% in 1999 to  $405,000  compared  to
$502,000 in the prior year.  In 1998,  the Company had been  involved in various
appeals and hearings in connection  with the  opposition by the State of Florida
and others to the issuance of a drilling  permit and the taking claim  regarding
its  royalty  interest  acreage.  During  1999,  the  level  of  legal  activity
decreased.

         Administrative  expenses  decreased 4% in 1999 to $474,000  compared to
$495,000 in 1998.

         Salaries  decreased  2% to $158,000  during  1999  compared to $161,000
during 1998.

         Shareholder  communications  decreased  23%  from  $133,000  in 1998 to
$103,000 in 1999. The decrease in costs during 1999 resulted from a reduction in
mailing costs to the Company's shareholders.

         Exploration  costs decreased from $31,000 in 1998 to $21,000 in 1999 in
connection with the Company's program to identify potential drilling  prospects.
These  miscellaneous   exploration  expenses  do  not  include  the  exploration
expenditures totaling $24,000 that were capitalized in 1999 ($340,000 in 1998).


Item 7A. Quantitative and Qualitative Disclosure About Market Risk

         The Company  does not have any  significant  exposure to market risk as
the only market risk  sensitive  instruments  are its  investments in marketable
securities.  At  December  31,  2000,  the  carrying  value of such  investments
(including those classified as cash and cash equivalents) was approximately $2.8
million,  the fair value was $2.8  million and the face value was $2.8  million.
Since the Company  expects to hold the  investments  to  maturity,  the maturity
value should be realized.

<PAGE>

Item 8.  Financial Statements and Supplementary Data



                         REPORT OF INDEPENDENT AUDITORS


The Board of Directors
Coastal Caribbean Oils & Minerals, Ltd.

We  have  audited  the  accompanying  consolidated  balance  sheets  of  Coastal
Caribbean Oils & Minerals, Ltd. (a development stage company) as of December 31,
2000 and 1999,  and the related  consolidated  statements  of  operations,  cash
flows,  and common  stock and capital in excess of par value for the period from
January 31,  1953  (inception)  to  December  31, 2000 and for each of the three
years in the period ended December 31, 1999. These financial  statements are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable  assurance about whether the financial  statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects, the consolidated financial position of Coastal
Caribbean  Oils &  Minerals,  Ltd.  at  December  31,  2000  and  1999,  and the
consolidated  results of its  operations  and its cash flows for the period from
January 31,  1953  (inception)  to  December  31, 2000 and for each of the three
years in the period ended  December  31, 2000,  in  conformity  with  accounting
principles generally accepted in the United States.




                                                  /s/ Ernst & Young LLP



Stamford, Connecticut
March 1, 2001

<PAGE>

<TABLE>
<CAPTION>

                                          COASTAL CARIBBEAN OILS & MINERALS, LTD.
                                                  (A Bermuda Corporation)
                                                A Development Stage Company

                                                CONSOLIDATED BALANCE SHEETS
                                                (Expressed in U.S. dollars)

                                                                                        December 31,
                                                                          -----------------------------------------
                                                                                 2000                   1999
                                                                          -----------------------------------------
                                ASSETS

Current assets:

<S>                                                                         <C>                      <C>
  Cash and cash equivalents                                                     $  2,958,674          $     651,124
  Interest and accounts receivable                                                    41,520                 25,583
  Prepaid expenses                                                                   323,897                352,089
                                                                                  ----------             ----------
          Total current assets                                                     3,324,091              1,028,796
                                                                                   ---------              ---------

Marketable securities                                                                      -                390,941
Unproved oil, gas and mineral properties (full cost
  method)                                                                          4,807,722              4,759,532
  Other                                                                               27,866                 27,445
                                                                                ------------           ------------
Total assets                                                                    $  8,159,679           $  6,206,714
                                                                                ============           ============

                 LIABILITIES AND SHAREHOLDERS' EQUITY
<<
Current liabilities:
  Accrued liabilities                                                                193,176         $       68,424
                                                                                ------------         --------------

Minority interests                                                                         -                      -

Shareholders' equity:
  Common stock, par value $.12 per share:
    Authorized - 250,000,000 shares
    Outstanding - 43,468,329 and 40,056,358  shares                                5,216,199              4,806,763
  Capital in excess of par value                                                  31,497,362             28,693,033
                                                                                  ----------             ----------
                                                                                  36,713,561             33,499,796
  Deficit accumulated during the development stage                               (28,747,058)           (27,361,506)
                                                                                 ------------           ------------
Total shareholders' equity                                                         7,966,503              6,138,290
                                                                               -------------          -------------
Total liabilities and shareholders' equity                                      $  8,159,679           $  6,206,714
                                                                                ============           ============

                                                  See accompanying notes.
</TABLE>
<PAGE>

                     COASTAL CARIBBEAN OILS & MINERALS, LTD.
                             (A Bermuda Corporation)
                           A Development Stage Company

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                           (Expressed in U.S. Dollars)
<TABLE>
<CAPTION>

                                                                                                              For the
                                                                                                            period from
                                                                                                           Jan. 31, 1953
                                                                                                            (inception)
                                                          Year ended December 31,                                to
                                               2000                 1999                 1998              Dec. 31, 2000
                                             -----------      -----------------     --------------      -----------------
<S>                                          <C>                  <C>                 <C>                <C>
Interest and other income                    $  62,544            $  55,275           $  167,178         $  3,791,123
                                             ---------            ---------           ----------         ------------

Expenses:
  Legal fees and costs                         633,521              405,380              501,708           13,010,513
  Administrative expenses                      535,325              474,027              495,161            7,873,661
  Salaries                                     151,800              157,550              161,000            3,220,628
  Shareholder communications                   107,852              102,825              132,924            3,779,632
  Exploration costs                             19,598               20,954               31,066              824,212
  Lawsuit judgments                                  -                    -                    -            1,941,916
  Minority interests                                 -                    -                    -             (632,974)
  Other                                              -                    -                    -              364,865
  Contractual services                               -                    -                    -            2,155,728
                                          --------------     ----------------     ----------------          ---------
                                             1,448,096            1,160,736            1,321,859           32,538,181
                                             ---------            ---------            ---------           ----------

Net loss                                   $(1,385,552)         $(1,105,461)         $(1,154,681)
                                           ============         ============         ============

Deficit accumulated during the
  development stage                                                                                      $(28,747,058)
                                                                                                          ============

Net loss per share  based on  average
  number of shares  outstanding  during
  the period:
    Basic and diluted EPS                     $(.03)               $(.03)               $(.03)
                                              ======               ======               ======

Average number of shares outstanding
    (basic and diluted)                     40,843,736           40,056,358           40,056,358
                                            ==========           ==========           ==========


                             See accompanying notes.
</TABLE>
<PAGE>

                     COASTAL CARIBBEAN OILS & MINERALS, LTD.
                             (A Bermuda Corporation)
                           A Development Stage Company

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                           (Expressed in U.S. Dollars)
<TABLE>
<CAPTION>

                                                                                                                 For the period from
                                                                                                                     Jan. 31, 1953
                                                                                                                      (inception)
                                                                           Year ended December 31,                         to
                                                                  2000              1999              1998           Dec. 31, 2000

<S>                                                              <C>               <C>              <C>                <C>
Net loss                                                         $(1,385,552)      $(1,105,461)     $(1,154,681)       $(28,747,058)
                                                                 -----------       -----------      -----------        ------------
Adjustments to reconcile net loss to net cash
  Used in operating activities:
    Minority interest                                                      -                 -                -            (632,974)
    Exploration and other                                                  -                 -                -             755,974
    Compensation recognized for stock option grant                    75,000                 -                -              75,000
    Net change in:
     Accounts receivable                                             (15,937)           27,051           24,668             (41,520)
     Prepaid expenses                                                 28,192           (37,809)        (100,440)           (323,897)
     Current liabilities                                             124,752             1,125            3,324             193,176
     Other                                                              (421)             (247)            (433)            471,040
                                                                 ------------       -----------     ------------      -------------
Net cash used in operating activities                             (1,173,966)       (1,115,341)      (1,227,562)        (28,250,259)
                                                                  -----------       -----------      -----------        ------------

Investing activities:
  Additions to oil, gas, and mineral properties
    Net of assets acquired for common stock                          (48,190)          (23,913)        (340,487)         (4,807,722)
  Marketable securities (net)                                        390,941         1,737,898        1,304,196                   -
  Reimbursement of lease rentals and
    Other expenses                                                         -                 -                -           1,243,085
  Purchase of fixed assets                                                  -                                  -            (61,649)
                                                                    ---------     ------------     ------------        ------------
                                                                                             -
Net cash provided by (used in) investing
 activities                                                          342,751         1,713,985          963,709          (3,626,286)
                                                                     -------         ---------       ----------          -----------

Financing activities:
  Sale of common stock net of  expenses                            3,138,765                 -                -          29,480,970
  Shares issued upon exercise of options                                   -                 -                -             884,249
  Sale of shares by subsidiary                                             -                 -                -             750,000
  Sale of subsidiary shares                                                                                               3,720,000
                                                                 -----------    -------------   ----------------         -----------
                                                                           -                 -                -
Net cash provided by financing activities                          3,138,765                                             34,835,219
                                                                   ---------   ---------------- ----------------         ----------
                                                                                             -                -
Net increase (decrease) in cash and cash
  equivalents                                                      2,307,550           598,644         (263,853)          2,958,674
Cash and cash equivalents at beginning of
  period                                                             651,124            52,480          316,333                   -
                                                                   ---------         ---------        ---------       -------------
Cash and cash equivalents at end of period                      $  2,958,674        $  651,124        $  52,480        $  2,958,674
                                                                ============        ==========        =========        ============
</TABLE>



                             See accompanying notes.

<PAGE>

<TABLE>
<CAPTION>
                     COASTAL CARIBBEAN OILS & MINERALS, LTD.
                             (A Bermuda Corporation)
                           A Development Stage Company

                     CONSOLIDATED STATEMENT OF COMMON STOCK
                       AND CAPITAL IN EXCESS OF PAR VALUE
                           (Expressed in U.S. dollars)
      For the period from January 31, 1953 (inception) to December 31, 2000

                                                                                                                       Capital in
                                                                       Number of                 Common                  Excess
                                                                         Shares                  Stock                of Par Value
Shares issued for net assets and unrecovered costs
<S>                                                                    <C>                      <C>                    <C>
   at inception                                                          5,790,210              $  579,021             $ 1,542,868
Sales of common stock                                                   26,829,486               3,224,014              16,818,844
Shares issued upon exercise of stock options                               510,000                  59,739                 799,760
Market value ($2.375 per share) of shares issued in
  1953 to acquire an investment                                             54,538                   5,454                 124,074
Shares issued in 1953 in exchange for 1/3rd of a 1/60th
  overriding royalty (sold in prior year) in nonproducing
  leases of Coastal Petroleum                                               84,210                   8,421                       -
Market value of shares issued for services rendered
  during the period 1954-1966                                               95,188                   9,673                 109,827
Net transfers to restate the par value of common stock
  outstanding in 1962 and 1970 to $0.12 per share                                -                 117,314                (117,314)
Increase in Company's investment (equity) due to
  capital transactions of Coastal Petroleum in 1976                               -                      -                 117,025
                                                                 ------------------       ----------------            ------------
Balance at December 31, 1990                                            33,363,632               4,003,636              19,395,084
Sale of subsidiary shares                                                         -                      -                 300,000
                                                                 ------------------       ----------------            ------------
Balance at December 31, 1991                                            33,363,632               4,003,636              19,695,084
Sale of subsidiary shares                                                         -                      -                 390,000
                                                                 ------------------       ----------------            ------------
Balance at December 31, 1992                                            33,363,632               4,003,636              20,085,084
Sale of subsidiary shares                                                         -                      -               1,080,000
                                                                 ------------------       ----------------             -----------
Balance at December 31, 1993                                            33,363,632               4,003,636              21,165,084
Sale of subsidiary shares                                                         -                      -                 630,000
                                                                 ------------------       ----------------            ------------
Balance at December 31, 1994                                            33,363,632               4,003,636              21,795,084
Sale of subsidiary shares                                                         -                      -                 600,000
                                                                 ------------------       ----------------            ------------
Balance at December 31, 1995                                            33,363,632               4,003,636              22,395,084
Sale of common stock                                                     6,672,726                 800,727               5,555,599
Sale of subsidiary shares                                                        -                       -                 480,000
Exercise of stock options                                                   10,000                   1,200                  12,300
                                                                     -------------            ------------           -------------
Balance at December 31, 1996                                            40,046,358               4,805,563              28,442,983
Sale of subsidiary shares                                                        -                       -                 240,000
Exercise of stock options                                                   10,000                   1,200                  10,050
                                                                     -------------            ------------           -------------
Balance at December 31, 1997,1998 and 1999                              40,056,358               4,806,763              28,693,033
Sale of common stock                                                     3,411,971                 409,436               2,729,329
Compensation recognized for stock option grant                                   -                       -                75,000
                                                                      -------------           ------------            ------------
Balance at December 31, 2000                                          $ 43,468,329             $ 5,216,199            $ 31,497,362
                                                                      =============           ============            ============

                             See accompanying notes.
</TABLE>
<PAGE>


                     COASTAL CARIBBEAN OILS & MINERALS, LTD.
                   Notes to Consolidated Financial Statements
                                December 31, 2000

1.       Summary of significant accounting policies

Consolidation

         The accompanying consolidated financial statements include the accounts
of  Coastal  Caribbean  Oils &  Minerals,  Ltd.  ("Coastal  Caribbean")  and its
majority owned subsidiary,  Coastal  Petroleum  Company  ("Coastal  Petroleum"),
hereinafter  referred to  collectively  as the Company.  The  Company,  which is
engaged in a single  industry and segment,  is  considered  to be a  development
stage  company since its  exploration  for oil, gas and minerals has not yielded
any significant  revenue or reserves.  All intercompany  transactions  have been
eliminated.

Cash and cash equivalents

         The Company  considers all highly liquid  short-term  investments  with
maturities  of  three  months  or less at the  date  of  acquisition  to be cash
equivalents.  Cash and cash  equivalents are carried at cost which  approximates
market value. The components of cash and cash equivalents are as follows:

                                                         December 31,
                                   ---------------            ---------------
                                          2000                       1999
Cash                                  $  159,834                   $ 59,061
Short term investments                 2,798,840                    592,063
                                     -----------                  ---------
                                      $2,958,674                   $651,124
                                      ==========                   ========


Use of Estimates

         The preparation of consolidated financial statements in conformity with
accounting   principles   generally  accepted  in  the  United  States  requires
management to make estimates and assumptions that affect the amounts reported in
the financial  statements and accompanying  notes. The outcome of the litigation
and the  ability to develop the  Company's  oil and gas  properties  will have a
significant   effect  on  the  Company's   financial  position  and  results  of
operations. Actual results could differ from those estimates.

Unproved oil and gas properties

         The Company  follows the full cost method of accounting for its oil and
gas properties. All costs associated with property acquisition,  exploration and
development activities whether successful or unsuccessful are capitalized. Since
the Company's  properties are undeveloped and  nonproducing,  and the subject of
litigation capitalized costs are not being amortized.

         The Company assesses whether its unproved  properties are impaired on a
periodic  basis.  This assessment is based upon work completed on the properties
to  date,  the  expiration  date of its  leases  and  technical  data  from  the
properties  and  adjacent  areas.  These  properties  are  subject to  extensive
litigation  with the State of Florida.  Although the property  interests  may be
impaired by the actions taken by the State,  the likelihood of loss with respect
to the recorded  costs of the leasehold  interests is not probable.  (See Note 5
"Litigation".)  Based on the exploration  activities on the properties completed
to date, the  exploration  and  development  activities of others in the Gulf of
Mexico and the laws applicable to the taking of property, the Company expects to
recover  its  $4.8  million  of  capitalized  costs.  However,  there  can be no
assurance  that it will be  successful  and that  costs  associated  with  these
properties will be realized.

Sale of Subsidiary Shares

         All amounts  realized  from the sale of Coastal  Petroleum  shares have
been credited to capital in excess of par value.

Earnings (loss) per share

         Earnings per common share is based upon the weighted  average number of
common and common equivalent shares outstanding during the period. The Company's
basic and  diluted  calculations  of EPS are the same  because  the  exercise of
options is not  assumed  in  calculating  diluted  EPS,  as the result  would be
anti-dilutive (the Company has continuing losses).

Financial instruments

         The carrying value for cash and cash equivalents,  accounts receivable,
marketable  securities  and accounts  payable  approximates  fair value based on
anticipated cash flows and current market conditions.

<PAGE>

2.       Coastal Petroleum Company - Minority Interests

         In 1992,  Coastal Caribbean granted Lykes Minerals Corp.  ("Lykes"),  a
wholly owned  subsidiary of Lykes Bros.  Inc., an option to acquire 78 shares of
Coastal  Petroleum at $40,000 per share.  Lykes  exercised all of its options to
purchase Coastal  Petroleum shares at a total cost of $3,120,000 and at December
31, 1998 and 1997, held 26.7% of Coastal Petroleum.

         The Lykes  agreement  provides  that Lykes is entitled to exchange each
Coastal  Petroleum  share for  100,000  Coastal  Caribbean  shares,  subject  to
adjustment for dilution and other factors. If fully exercised,  that entitlement
would  leave  Lykes with about 15% of Coastal  Caribbean's  outstanding  shares.
Lykes also has the right to exchange  Coastal  Petroleum  shares for  overriding
royalty interests in Coastal Petroleum's  properties.  If Lykes were to exchange
its 26.7% interest in Coastal Petroleum for a royalty  interest,  its overriding
royalty interest in Coastal Petroleum's working-interest acreage would be 3.3%.

         As of December 31, 2000 and 1999,  Coastal  Petroleum shares were owned
as follows:

                                                 Shares                    %
                                                 ------                  ------
         Coastal Caribbean                         173                    59.3
         Lykes                                      78                    26.7
         Others                                     41                    14.0
                                                  ----                  ------
                                                   292                   100.0
                                                   ===                   =====

3.       Marketable Securities

         At December 31, 1999 the following marketable securities were available
for sale because of the Company's capital requirements:

                                                           Maturity     Carrying
               Security        Par Value       Date         Value     Fair Value
               ---------       ---------       ----         -----     ----------
Connecticut State Serial A
Taxable Bond  6.25%            $400,000     July 1, 2003   $390,941     $390,941
                               ========                    ========     ========

4.       Unproved oil, gas and mineral properties

         Coastal  Petroleum holds three unproved and  nonproducing  oil, gas and
mineral leases granted by the Trustees of the Internal  Improvement  Fund of the
State of Florida (the "Trustees").  These leases cover submerged and unsubmerged
lands,  principally  along the Florida Gulf Coast,  and certain inland lakes and
rivers throughout the State.

         The two leases  bordering  the Gulf Coast have been  divided into three
areas,  each running the entire length of the coastline from Apalachicola Bay to
the Naples area.  Coastal  Petroleum has certain royalty  interests in the inner
area, no interest in the middle area and a 100% working  interest in the outside
area.

         Coastal  Petroleum also has a 100% working interest in Lake Okeechobee,
and a royalty  interest  in other  areas.  Coastal  Petroleum  has agreed not to
conduct  exploration,  drilling,  or mining operations on said lake, except with
prior approval of the Trustees.

         The  three  leases  have a term of 40 years  from  January  6, 1976 and
require the payment of annual lease rentals of $59,247,  if oil, gas or minerals
are being produced in  economically  sustainable  quantities at January 6, 2016,
these operations will be allowed to continue until they become  uneconomic.  The
drilling  requirements are governed by Chapter 20680,  Laws of Florida,  Acts of
1941. The Company is current in fulfilling its drilling requirements.

         The working interest areas of the three leases are subject to royalties
payable to the  Trustees of 12 1/2% on oil and gas,  $.50 per long ton of sulfur
and 10% on other  minerals.  The leases are  subject  to  additional  overriding
royalties which  aggregate  1/16th as to oil, gas and sulfur and 13/600ths as to
other minerals.

         During 2000, the Company capitalized  approximately $48,000 ($24,000 in
1999 and  $340,000  in 1998)  under a program  to  identify  potential  drilling
prospects.  The amount of 2001 expenditures,  if any, will depend on the outcome
of the Florida litigation.
<PAGE>

         The following is a summary of the cost of unproved oil, gas and mineral
properties,  accounted for under the full cost method,  all of which are located
in Florida:

                                                       2000            1999
Lease acquisition costs                             $   914,619     $   914,619
Lease and royalty costs (principally legal fees)        591,616         591,616
Lease rentals                                         2,507,020       2,447,774
Dry hole costs                                          587,987         587,987
Other exploratory expenses                            1,229,316       1,240,372
Salaries                                                466,983         466,983
                                                   ------------    ------------
                                                      6,297,541       6,249,351
                                                    -----------     -----------
Deduct:
  Reimbursement for lease rentals and other expenses  1,229,316       1,243,086
  Proceeds from relinquishment of surface rights        246,733         246,733
                                                   ------------    ------------
                                                      1,489,819       1,489,819
                                                    -----------     -----------
    Total unproved oil, gas and mineral properties   $4,807,722      $4,759,532
                                                     ==========      ==========


5.       Litigation

          Florida Litigation

         Coastal Petroleum has been involved in various lawsuits for many years.
Coastal Petroleum's  current litigation (the "Florida  Litigation") now involves
one basic claim:  whether the State's denial of a permit constitutes a taking of
its property.  In addition,  Coastal  Caribbean is a party to another  action in
which Coastal  Caribbean claims that certain of its royalty  interests have been
confiscated by the State.

          In 1990,  the State of  Florida  enacted  legislation  that  prohibits
drilling or exploration for oil or gas on Florida's  offshore acreage.  Although
the law does not apply to areas where  Coastal  Petroleum is entitled to conduct
exploration,  the State of Florida has  effectively  prevented  any  exploratory
drilling by denying the Company's application for drilling permits. In addition,
in those areas where Coastal Petroleum has only a royalty interest, the law also
effectively  prohibits  production of oil and gas,  rendering it impossible  for
Coastal  Petroleum to collect royalties from those areas.  During 1998,  Coastal
Petroleum exhausted its legal remedies in its efforts to obtain compensation for
the drilling prohibition on its royalty interest acreage.

Lease Taking Case

         On June 26,  2000,  the  First  District  Court of Appeal  affirmed  an
earlier ruling that the Florida  Department of  Environmental  Protection  (DEP)
could deny Coastal  Petroleum a permit to drill an  exploratory  well about nine
miles south of St.  George  Island in the Florida  Panhandle.  While the appeals
court  held that the DEP could  take  such  action on the basis of a  compelling
public  purpose in not allowing  offshore  oil and gas drilling in Florida,  the
court  also  found  that the DEP's  action  would be  unconstitutional  "if just
compensation is not paid for what is taken."

         On January 16, 2001, Coastal Petroleum Company filed a complaint in the
Leon  County  Circuit  Court in Florida  against  the State of  Florida  seeking
compensation  for the State's  taking of its property  rights to explore for oil
and gas within its Lease 224-A .

     On February 13, 2001,  certain  holders of  royalties  pertaining  to Lease
224-A filed a Motion to Intervene as  Additional  Plaintiffs.  A hearing on that
motion is scheduled to be held by the court on March 29, 2001.

     On March 5, 2001, the State filed a Motion to Dismiss  Coastal  Petroleum's
complaint.  A hearing  on that  motion is  scheduled  to be held by the court on
April 26, 2001.

Royalty Taking Case

         The  offshore  areas  covered by Coastal  Petroleum's  original  leases
(prior to the 1976  Settlement  Agreement)  are subject to certain other royalty
interests held by third parties,  including Coastal Caribbean.  Several of those
third parties,  including Coastal Caribbean,  have instituted a separate lawsuit
against the State. That lawsuit claims that the royalty holders'  interests have
been  confiscated as a result of the State's  actions  discussed  above and that
they are entitled to compensation for that taking.

         The royalty holders were not parties to the 1976 Settlement  Agreement,
and the royalty  holders  contend that the terms of the Settlement  Agreement do
not insulate the State from taking claims by those royalty holders.  The case is
currently pending before the Circuit Court in Tallahassee.  On December 2, 1999,
the Circuit Court denied the State's motion to dismiss the plaintiffs'  claim of
inverse condemnation but dismissed several other claims.

         On May 10, 2000,  the State filed a motion for summary  judgment but no
hearing date has been set for the motion. Discovery is proceeding.

         Any recovery made in the royalty holders' lawsuit would be shared among
the various  plaintiffs in that lawsuit,  including Coastal  Caribbean,  but not
Coastal Petroleum.

Counsel

         The Tampa,  Florida law firm of Gaylord Merlin  Ludovici Diaz & Bain is
Coastal  Petroleum's  principal  trial  counsel in Coastal  Petroleum's  inverse
condemnation  claim against the State of Florida in Florida  Circuit Court.  Mr.
Cary Gaylord  will be the lead  attorney for Gaylord  Merlin.  In addition,  Mr.
Robert J.  Angerer  of Angerer & Angerer of  Tallahassee,  Florida is  assisting
Gaylord Merlin in the litigation.

Statutory Attorneys' Fees

         Chapter 73 of Florida law provides in eminent domain proceedings (which
would include Coastal  Petroleum's  taking claim) that, in addition to the award
made to the property owner,  the court shall award  attorneys' fees based on the
difference  between the final judgment or settlement and the first written offer
made to the  property  owner by the  State  in  accordance  with  the  following
schedule:

         1.       Thirty-three percent of any difference up to $250,000; plus
         2.       Twenty-five percent of any portion of the difference between
                  $250,000 and $1 million; plus
         3.       Twenty percent of any portion of the difference exceeding
                  $1 million.

Contingency Fees

         Coastal Petroleum has agreed to pay an aggregate of 8.65% in contingent
fees based on any net recovery from execution on or  satisfaction of judgment or
from  settlement  of the Florida  litigation to various law firms and current of
former officers of the Company

         In  addition,  Coastal  Petroleum  has agreed to pay  Gaylord  Merlin a
contingent fee equal to the greater of:

         (b)      approximately 90% of the statutory award of attorneys' fees
                  (discussed above), less the hourly fees paid to Gaylord
                  Merlin, or

         (b)      ten  percent of the first $100  million or portion  thereof of
                  the compensation  received by Coastal Petroleum from the State
                  as  compensation  for the  taking of its  property,  plus five
                  percent of such  compensation in excess of $100 million,  less
                  the hourly fees paid to Gaylord  Merlin and other costs of the
                  litigation.

Uncertainty

         At  December  31,  2000,  the amount of unproved  oil,  gas and mineral
properties  totaled $4.8  million,  which costs the Company  expects to recover.
However,  no assurances can be given that Coastal Petroleum or Coastal Caribbean
will  prevail  on any of the  issues  set forth  above,  that they will  recover
compensation for any of their claims, or that a drilling permit will be granted.
In  addition,  even if  Coastal  Petroleum  were to prevail on any or all of the
issues to be  decided,  no  assurance  can be given that  Coastal  Caribbean  or
Coastal Petroleum will have sufficient financial resources to survive until such
decisions  become  final or to drill any wells for which  permits are  received.
There is also no assurance that any wells drilled will be successful and lead to
production of any oil or gas in commercial quantities.


6.       Common Stock

         The Company's  Bye-Law No. 21 provides that any matter to be voted upon
must be approved not only by a majority of the shares voted at such meeting, but
also by a majority in number of the  shareholders  present in person or by proxy
and entitled to vote thereon.

         The Company has been financing its  operations  primarily from sales of
common stock and sales of shares of Coastal Petroleum (See Note 2).

         During 1997, the  shareholders  of the Company  approved an increase in
the  authorized  capital of the Company from  100,000,000  shares to 250,000,000
shares.

         On October 23, 2000, the Company completed the sale of 3,411,971 shares
of its common stock to its  shareholders at $1.00 per share. The net proceeds to
the Company were $3,138,765 after deducting the $273,206 cost of the offering.
<PAGE>

         The following represents shares issued upon sales of common stock:

                  Number of                                   Capital in Excess
                   Shares                  Capital Stock         of Par Value
                ------------               -------------    --------------------
   1953            300,000                   $ 30,000            $ 654,000
   1954             53,000                      5,300              114,265
   1955             67,000                      6,700              137,937
   1956             77,100                      7,710              139,548
   1957             95,400                      9,540              152,492
   1958            180,884                     18,088              207,135
   1959            123,011                     12,301              160,751
   1960            134,300                     13,430              131,431
   1961            127,500                     12,750               94,077
   1962              9,900                        990                8,036
   1963            168,200                     23,548               12,041
   1964            331,800                     46,452               45,044
   1965            435,200                     60,928              442,391
   1966            187,000                     26,180              194,187
   1967            193,954                     27,153              249,608
   1968             67,500                      9,450              127,468
   1969              8,200                      1,148               13,532
   1970            274,600                     32,952              117,154
   1971            299,000                     35,880               99,202
   1972            462,600                     55,512              126,185
   1973            619,800                     74,376              251,202
   1974            398,300                     47,796               60,007
   1975                  -                          -              (52,618)
   1976                  -                          -               (8,200)
   1977            850,000                    102,000            1,682,706
   1978             90,797                     10,896              158,343
   1979          1,065,943                    127,914            4,124,063
   1980            179,831                     21,580              826,763
   1981             30,600                      3,672              159,360
   1983          5,318,862                    638,263            1,814,642
   1985                  -                          -              (36,220)
   1986          6,228,143                    747,378            2,178,471
   1987          4,152,095                    498,251            2,407,522
   1990          4,298,966                    515,876               26,319
   1996          6,672,726                    800,727            5,555,599
   2000          3,411,971                    409,436            2,729,329
                 ---------                    -------            ---------
               $36,914,183                 $4,434,177          $25,103,772
               ===========                 ==========          ===========

         The following represents shares issued upon exercise of stock options:

 1955               73,000                    $ 7,300             $175,200
 1978                7,000                        840                6,160
 1979              213,570                     25,628              265,619
 1980               76,830                      9,219              125,233
 1981              139,600                     16,752              227,548
 1996               10,000                      1,200               12,300
 1997               10,000                      1,200               10,050
                  --------                  ---------           ----------
                   530,000                    $62,139             $822,110
                   =======                    =======             ========

         Coastal Caribbean has reserved  7,800,000 shares which may be issued in
exchange for Coastal Petroleum shares, as described in Note 2.

7.       Stock Option Plan

         The Company has elected to follow  Accounting  Principles Board Opinion
No. 25,  "Accounting  for Stock  Issued to  Employees"  (APB No. 25) and related
Interpretations in accounting for its stock options because the alternative fair
value  accounting  provided under FASB Statement No. 123,  "Accounting for Stock
Based  Compensation,"  requires  use of option  valuation  models  that were not
developed  for use in  valuing  stock  options.  Under APB No. 25,  because  the
exercise  price of the Company's  stock  options  equals the market price of the
underlying stock on the date of grant, no compensation expense is recognized.

         During 1995, the Company adopted a Stock Option Plan covering 1,000,000
shares of the  Company's  common stock.  On March 24, 2000,  ten year options to
purchase  700,000 shares of the Company's  common stock and recorded a charge to
legal expense in the amount of $75,000 for the issuance 100,000 options to legal
counsel. Options are normally immediately vested and exercisable.  The following
table summarizes stock option activity:
<PAGE>

<TABLE>
<CAPTION>

Options outstanding                                Number of Shares     Exercise Price ($)
-------------------                                ----------------     ------------------
<S>                                                     <C>                    <C>
Outstanding and exercisable at December 31, 1997        362,000                1.13
     Granted                                            225,000                2.625
                                                        -------
Outstanding and exercisable at December 31, 1998        587,000             1.13-2.625
     Expired                                           (60,000)                1.13
                                                       -------=
Outstanding and exercisable at December 31, 1999        527,000             1.13-2.625
     Expired                                           (302,000)              . 1.13
     Granted                                            700,000                 .91
                                                        -------
Outstanding and exercisable at December 31, 2000        925,000             .91 -2.625
                                                        =======
                                                                    (1.33 weighted average)

Available for grant at December 31, 2000                 55,000
----------------------------------------                 ======
</TABLE>

Summary of Options Outstanding at December 31, 2000

Year Granted    Number of Shares           Expiration Date     Exercise Prices $
------------    ----------------           ---------------     -----------------
Granted 1998        225,000                 May 19, 2003               2.625
Granted 2000        700,000                 Mar. 22, 2010               .91
                    -------
Total               925,000
                    =======

         Pro forma  information  regarding  net income and earnings per share is
required by FASB  Statement  No. 123, and has been  determined as if the Company
had  accounted  for its  stock  options  under  the fair  value  method  of that
Statement.  The fair value for these  options was estimated at the date of grant
using a Black-Scholes option-pricing model.

         Option  valuation  models  require  the  input  of  highly   subjective
assumptions including the expected stock price volatility.  The assumptions used
in the valuation model were: 1998 risk free interest rate - 5.45%, expected life
- 5 years, expected volatility - .707 and expected dividend - 0 and in 2000 risk
free interest rate - 6.66%, expected life - 10 years, expected volatility - .741
and expected dividend - 0.

         Because the Company's stock options have characteristics  significantly
different from those of traded  options,  and because  changes in the subjective
input assumptions can materially affect the fair value estimate, in management's
opinion,  the  existing  models do not  necessarily  provide a  reliable  single
measure of the fair value of its stock options.

         For the purpose of pro forma  disclosures,  the estimated fair value of
the  stock  options  is  expensed  in the year of grant  since the  options  are
immediately exercisable. The Company's pro forma information follows:

                                             Amount                   Per Share
Net loss as reported - December 31, 1998    $(1,154,681)                 $(.03)
Stock option expense                           (369,000)                  (.01)
                                            ------------                  -----
Pro forma net loss                          $(1,523,681)                 $(.04)
                                            ============                 ======

Net loss as reported - December 31, 2000    $(1,385,552)                 $(.03)
Stock option expense                           (450,000)                  (.01)
                                            ------------                  -----
Pro forma net loss                          $(1,835,552)                 $(.04)
                                            ============                 ======

8.       Income taxes

         Bermuda currently imposes no taxes on corporate income or capital gains
outside of Bermuda. The Company's  subsidiary,  Coastal Petroleum,  has U.S. net
operating loss carry  forwards for federal and state income tax purposes,  which
may be used to reduce its taxable  income,  if any,  during  future  years which
aggregated  approximately  $12,133,000  at  December  31, 2000  ($12,077,000  at
December 31, 1999) and expire in varying  amounts  from 2001 through  2020.  For
financial  reporting  purposes,  a valuation  allowance  has been  recognized to
offset the deferred  tax assets  relating to those carry  forwards.  Significant
components of the Company's deferred tax assets were as follows:
<PAGE>

                                                  2000                1999
                                                  ----                ----
Net operating losses                             $4,720,000          $4,544,000
Deferred intercompany interest deduction          1,453,000           1,109,000
                                                -----------         -----------
Total deferred tax assets                         6,173,000           5,653,000
Valuation allowance                              (6,173,000)         (5,653,000)
                                                 -----------         -----------
Net deferred tax assets                          $         -         $         -
                                                 ===========         ===========

9.       Related parties

         G&O'D INC provides  accounting and  administrative  services and office
facilities and support staff to the Company.  G&O'D INC is owned by Mr. James R.
Joyce,  Treasurer and Assistant  Secretary.  During 2000,  1999 and 1998,  G&O'D
billed fees of $155,440, 144,495, and $160,764, respectively.



                                     PART II

Item 9.  Changes in and Disagreements with Accountants on
         Accounting and Financial Disclosure

                  None.

<PAGE>

                                    PART III

         For information  concerning Item 10 - Directors and Executive  Officers
of the Company, Item 11 - Executive  Compensation,  Item 12 - Security Ownership
of Certain Beneficial Owners and Management and Item 13 - Certain  Relationships
and Related Transactions, see the Proxy Statement of the Company relative to the
Annual  Meeting of  Stockholders  for the fiscal year ended  December  31, 2000,
which  will  be  filed  with  the  Securities  and  Exchange  Commission,  which
information is incorporated herein by reference. For information concerning Item
10 - Executive Officers of the Company, see Part I.

                                     PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
-------  ---------------------------------------------------------------

         (a)      (1)      Financial Statements.
                           --------------------

                           The financial statements  listed  below and  included
under Item 8 above are filed as part of this report.
<TABLE>
<CAPTION>
                                                                                              Page

<S>                                                                                            <C>
Report of Independent Auditors                                                                 25

Consolidated balance sheets at December 31, 2000 and 1999                                      26

Consolidated  statements  of  operations  for the period  from  January 31, 1953
  (inception) to December 31, 2000 and for each of the three years in the
  period ended December 31, 2000                                                               27

Consolidated  statements  of cash flows for the period  from  January  31,  1953
  (inception) to December 31, 2000 and for each of the three years in the
  period ended December 31, 2000                                                               28

Consolidated  statements  of common stock and capital in excess of par value for
  the period from January 31, 1953 (inception)
  to December 31, 2000                                                                         29

Notes to consolidated financial statements                                                     30
</TABLE>

                  (2)      Financial Statement Schedules.
                           -----------------------------

                           All  schedules  have been omitted since the required
information  is not present or not present in amounts sufficient to require
submission of the schedule,  or because the information  required is included in
the consolidated  financial  statements and the notes thereto.

         (b)      Reports on Form 8-K.
                  ----------------------------
                  None

         (c)      Exhibits.
                  --------
                  The following exhibits are filed as part of this report:


Item Number

         2.       Plan of acquisition, reorganization, arrangement, liquidation
                  or succession.
                  -------------------------------------------------------------

                  Not applicable.

         3.       Articles of incorporation and By-Laws.

                  (a)      Memorandum  of  Association  as  amended  on June 30,
                           1982, May 14, 1985 and April 7, 1988 filed as Exhibit
                           3. (a) to  Report  on Form  10-K  for the year  ended
                           December   31,   1998  is   incorporated   herein  by
                           reference.

                  (b)      Bye-laws are  incorporated  by reference to Schedule
                           14(a) Proxy  Statement filed on May 13, 1997.

         4.       Instruments defining the rights of security holders, including
                  indentures.
                  --------------------------------------------------------------

                  Not applicable.

         9.       Voting trust agreement.
                  ----------------------

                  Not applicable.

         10.      Material contracts.

                  (a)      Drilling  Lease No. 224-A,  as modified,  between the
                           Trustees  of the  Internal  Improvement  Fund  of the
                           State of Florida and Coastal  Petroleum Company dated
                           February 27, 1947 filed as Exhibit 10(a) to Report on
                           Form 10-K for the year  ended  December  31,  1998 is
                           incorporated herein by reference.

                  (b)      Drilling  Lease No. 224-B,  as modified,  between the
                           Trustees  of the  Internal  Improvement  Fund  of the
                           State of Florida and Coastal  Petroleum Company dated
                           February 27, 1947 filed as Exhibit 10(b) to Report on
                           Form 10-K for the year  ended  December  31,  1998 is
                           incorporated herein be reference.

                  (c)      Drilling  Lease No.  248,  as  modified,  between the
                           Trustees  of the  Internal  Improvement  Fund  of the
                           State of Florida and Coastal  Petroleum Company dated
                           February 27, 1947 filed as Exhibit 10(c) to Report on
                           Form 10-K for the year  ended  December  31,  1998 is
                           incorporated herein by reference.

                  (d)      Memorandum of Settlement dated January 6,1976 between
                           Coastal  Petroleum  Company  and the State of Florida
                           filed as Exhibit 10(d) to Report on Form 10-K for the
                           year ended December 31, 1998 is  incorporated  herein
                           by reference.

                  (e)      Agreement  between the Company and Coastal  Petroleum
                           dated  December  3, 1991  filed as  Exhibit  10(e) to
                           Report on Form 10-K for the year ended  December  31,
                           1998 is incorporated herein by reference

                  (f)      Agreement  between Lykes  Minerals  Corp. and Coastal
                           Caribbean and Coastal  Petroleum dated  October  16,
                           1992  filed as  Exhibit  10(f) to  Report on Form
                           10-K for the year ended December 31, 1998 is
                           incorporated herein by reference.

                  (g)      Stock  Option  Plan  adopted  March 7, 1995  filed as
                           Exhibit  4A to  form  S-8  dated  July  28,  1995  is
                           incorporated herein by reference.

                  (h)      The decision Coastal  Petroleum  Company v. Florida
                           Wildlife  Federation et. al. of the First  District
                           Court of  Appeal  dated  October  6,  1999
                           (St.  George  Island  permit application  case),  is
                           incorporated  by  reference to Exhibit  99(a) to the
                           Company's Current Report on Form 8-K filed on
                           October 7, 1999.

                  (i)      Complaint  filed  January 16, 2001 in the Leon County
                           Circuit Court,  Coastal Petroleum Company,  Plaintiff
                           vs.  State of Florida,  Department  of  Environmental
                           Protection,  and Board of  Trustees  of the  Internal
                           Improvement  Fund,  Defendants,  is  incorporated  by
                           reference to Exhibit 99(a) to the  Company's  Current
                           Report on Form 8-K filed on January 18, 2001.

         11.      Statement re: computation of per share earnings.
                  -----------------------------------------------

                  None.

         12.      Statement re: computation of ratios.
                  -----------------------------------

                  Not applicable.

         13.      Annual report to security holders, Form 10-Q or quarterly
                  ----------------------------------------------------------
                  report to security holders.
                  ---------------------------

                  Not applicable.

         16.      Letter re: change in certifying accountant.
                  ------------------------------------------

                  Not applicable.


         18.      Letter re: change in accounting principles.
                  ------------------------------------------

                  Not applicable.

         21.      Subsidiaries of the registrant.
                  ------------------------------

                  The Company has one subsidiary,  Coastal Petroleum  Company, a
                  Florida corporation which is 59 1/4 % owned.

         22.      Published report regarding matters submitted to vote of
                  --------------------------------------------------------
                  security holders.
                  -----------------

                  Not applicable.

         23.      Consent of experts and counsel.
                  ------------------------------

                  Consent of Ernst & Young LLP is filed herein.

         24.      Power of attorney.
                  -----------------

                  Not applicable.

         99.      Additional exhibits.
                  -------------------

                  Not applicable.

         (d)      Financial Statement Schedules.
                  -----------------------------

                  None.

<PAGE>

                                   SIGNATURES

         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                         COASTAL CARIBBEAN OILS & MINERALS, LTD.
                                                     (Registrant)

                                         By /s/ Benjamin W. Heath
                                            ------------------------------------
                                             Benjamin W. Heath, President and
                                             Chief Executive Officer


Dated:           March 12, 2001
        --------------------------------

         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
this  report has been  signed  below by the  following  persons on behalf of the
registrant and in the capacities and on the date indicated.


By /s/ Benjamin W. Heath                    By        /s/James R. Joyce
   ----------------------------------------    ---------------------------------
    Benjamin W. Heath                                  James R. Joyce
    President, Director and Chief Executive            Treasurer and Chief
    Officer                                            Financial and Accounting
                                                       Officer

Dated:            March 12, 2001             Dated:      March 12, 2001
       -----------------------------------         ---------------------------


By /s/ Graham B. Collis                     By        /s/John D. Monroe
   ----------------------------------------  ----------------------------------
    Graham B. Collis                                   John D. Monroe
    Director                                           Director

Dated:            March 12, 2001             Dated:      March 12, 2001
       -----------------------------------         ---------------------------


By /s/ Phillip W. Ware                      By        /s/Nicholas B. Dill
   ---------------------------------------- -----------------------------------
    Phillip W. Ware                                    Nicholas B. Dill
    Director                                           Director

Dated:            March 12, 2001             Dated:      March 12, 2001
       -----------------------------------         -------------------------

By /s/ Timothy L. Largay
   ----------------------------------------
    Timothy L. Largay
    Director

Dated:            March 12, 2001
       -----------------------------------
<PAGE>

                                INDEX TO EXHIBITS


Exhibit No.
----------


         23.      Consent of Ernst & Young LLP


                                   EXHIBIT 23




                         Consent of Independent Auditors

We consent to the incorporation by reference in the Registration Statement (Form
S-8)  pertaining to the Stock Option plan of Coastal  Caribbean Oils & Minerals,
Ltd.  of our report  dated  March 1, 2001,  with  respect  to the  consolidated
financial  statements of Coastal Caribbean Oils & Minerals,  Ltd. in this Annual
Report (Form 10-K) for the year ended December 31, 2000.



                                                 /s/ Ernst & Young LLP


Stamford, Connecticut
March 8, 2001