<PAGE>

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-K

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

                  For the fiscal year ended     DECEMBER 31, 2001
                                             ---------------------

                                       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 0-22258

                              AVIVA PETROLEUM INC.
             (Exact name of registrant as specified in its charter)

Texas                                                            75-1432205
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                              Identification No.)

8235 Douglas Avenue,                                                     75225
Suite 400, Dallas, Texas                                        (Zip Code)
(Address of principal executive offices)
                                 (214) 691-3464
              (Registrant's telephone number, including area code)

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

                                            Names of each exchange
                                            ----------------------
          Title of each class               on which registered
          -------------------               -------------------
          Common Stock, without par value   None -- Common Stock quoted on
                                            OTC Bulletin Board

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

                        Common Stock, without par value

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. Yes  x  No ___.
                                              ---

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K 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 voting and non-voting common equity held by
non-affiliates of the Registrant on February 28, 2002 was approximately
$2,139,872. As of such date, the last sale price of a share of the Registrant's
common stock, without par value ("Common Stock"), was U.S. $0.05, as quoted on
the OTC Bulletin Board.

As of February 28, 2002, the Registrant had 46,900,132 shares of Common Stock
outstanding.

                      DOCUMENTS INCORPORATED BY REFERENCE

                                      None.

<PAGE>

                         TABLE OF CONTENTS TO FORM 10-K

                                                                           Page
                                                                        -------
Part I

     Item 1.    Business
                   General.......... ......................................   1
                   Garnet Merger...........................................   1
                   Debt Restructuring......................................   1
                   Current Operations......................................   1
                   Risks Associated with the Company's Business............   2
                   Products, Markets and Methods of Distribution...........   3
                   Regulation..............................................   4
                   Competition.............................................   6
                   Employees...............................................   7
     Item 2.    Properties
                   Productive Wells and Drilling Activity..................   7
                   Undeveloped Acreage.....................................   7
                   Title to Properties.....................................   8
                   Reserves and Future Net Cash Flows......................   8
                   Production, Sales Prices and Costs......................   8
                   Significant Properties
                      Colombia.............................................   9
                      United States........................................  11
                      Papua New Guinea.....................................  12
     Item 3.    Legal Proceedings..........................................  12
     Item 4.    Submission of Matters to a Vote of Security Holders........  13

Part II

     Item 5.    Market for Registrant's Common Equity and Related
                Stockholder Matters
                   Price Range of Depositary Shares and Common Stock.......  13
                   Dividend History and Restrictions.......................  14
     Item 6.    Selected Financial Data....................................  14
     Item 7.    Management's Discussion and Analysis of Financial Condition
                and Results of Operations
                   Critical Accounting Policies............................  15
                   Results of Operations...................................  15
                   New Accounting Pronouncements...........................  17
                   Liquidity and Capital Resources.........................  17
     Item 7A.   Quantitative and Qualitative Disclosure about Market Risk..  18
     Item 8.    Financial Statements and Supplementary Data................  18
     Item 9.    Changes in and Disagreements with Accountants on Accounting
                   and Financial Disclosure................................  18
Part III

     Item 10.   Directors and Executive Officers of the Registrant
                   Directors of the Company................................  19
                   Executive Officers of the Company.......................  19
                   Meetings and Committees of the Board of Directors.......  19
                   Compliance with Section 16(a) of the Securities Exchange
                   Act of 1934.............................................  20
     Item 11.   Executive Compensation
                   Summary Compensation Table..............................  20
                   Directors' Fees.........................................  20
                   Option Grants During 2001...............................  20
                   Option Exercises During 2001 and Year End Option Values.  20

                                      (i)

<PAGE>

                   TABLE OF CONTENTS TO FORM 10-K (Continued)

                                                                           Page
                                                                        -------
                   Compensation Committee Interlocks and Insider
                      Participation in Compensation Decisions..............  21
                   Employment Contracts....................................  21
                   Compensation Committee Report on Executive Compensation.  21
                   Performance Graph.......................................  22
     Item 12.   Security Ownership of Certain Beneficial Owners and
                Management
                   Security Ownership of Certain Beneficial Owners ........  23
                   Security Ownership of Management........................  24
     Item 13.   Certain Relationships and Related Transactions.............  24

Part IV

     Item 14.   Exhibits, Financial Statement Schedules and Reports on Form
                8-K........................................................  25

Signatures       ..........................................................  28

                                      (ii)

<PAGE>

                                     PART I

ITEM 1. BUSINESS

General

     Aviva Petroleum Inc. (referred to collectively with its consolidated
subsidiaries as the "Company"), a Texas corporation, through its subsidiaries,
is engaged in the exploration for and production and development of oil and gas
in Colombia, offshore in the United States, and in Papua New Guinea. The
Company was incorporated in 1973 and the common stock, without par value
("Common Stock"), of the Company trades on the OTC Bulletin Board under the
symbol "AVVP". The Company's principal executive offices are located in Dallas,
Texas.

Garnet Merger

     On October 28, 1998, the Company acquired Garnet Resources Corporation
("Garnet") in exchange for the issuance, in the aggregate, of approximately 14
million shares of the Company's Common Stock. Pursuant to the Agreement and
Plan of Merger dated as of June 24, 1998, an indirect, wholly owned subsidiary
of the Company was merged with and into Garnet. Garnet's $15 million of 9 1/2%
Convertible Subordinated Debentures were acquired and canceled, and the
outstanding bank debt of Garnet and the Company was refinanced under a $15
million credit facility which was fully retired in 2000. See "--Debt
Restructuring". As a result of the merger, the Company was able to effect cost
savings, particularly in Colombia where each company had an interest in the
same properties.

Debt Restructuring

     On June 8, 2000, the Company entered into agreements with the Company's
senior secured lender, Crosby Capital L.L.C. ("Crosby"), in order to
restructure the Company's senior debt which, including unpaid interest,
aggregated $16,103,064 as of May 31, 2000. Pursuant to the agreements, Crosby
canceled $13,353,064 of such debt and transferred to the Company warrants on
1,500,000 shares of the Company's common stock in exchange for the general
partner rights and an initial 77.5% partnership interest in Argosy Energy
International ("Argosy"), a Utah limited partnership which holds the Company's
Colombian properties. Following the transaction, Aviva Overseas, Inc. ("Aviva
Overseas"), a wholly owned subsidiary of the Company, owned a 22.1196% limited
partnership interest in Argosy. An additional 7.5% limited partnership interest
was transferred from Crosby to Aviva Overseas effective August 14, 2001, when
Crosby received in distributions from Argosy an amount equal to $3,500,000 plus
interest at the prime rate plus 1%. The Company's interest in Argosy is
29.6196% after the transfer.

     The Company's remaining debt of $2,750,000 was reacquired from Crosby on
December 21, 2000, in exchange for a 15% net profits interest in any new
production at Breton Sound Block 31 field. This transaction substantially
completed the restructuring of the Company and the reorganization of the
Company's wholly owned subsidiary, Aviva America, Inc. ("AAI").

     AAI had filed a voluntary petition for reorganization under Chapter 11 of
the U.S. Bankruptcy Code on July 21, 2000. The filing, in the Northern District
of Texas, was initiated in order to achieve a comprehensive restructuring of
AAI's debts. Following approval by the court and creditors, the voluntary
petition for reorganization became effective on November 17, 2000.

     As a result of the aforementioned transactions, all of the Company's
outstanding senior secured debt has been eliminated.

Current Operations

     Colombia. The Company is the owner of interests in, and is engaged in
     --------
exploration for, and development and production of oil from, three contracts
granted by Empresa Colombiana de Petroleos, the Colombian national oil company
("Ecopetrol").

     The Company's Colombian activities are carried out by Argosy which
operates the Colombian properties. Argosy is currently party to three contracts
with Ecopetrol called Santana, Rio Magdalena and Aporte Putumayo. Argosy

                                      1

<PAGE>

expects to sign a fourth contract, the Guayuyaco contract, in April 2002. All
contract areas are located in the Putumayo Basin of southwestern Colombia,
except for Rio Magdalena which is located in the Upper Magdalena Basin in
central Colombia. The Company's production activities are currently limited to
the Santana contract area.

     Twenty-one wells have been drilled on the Santana contract area. Of 13
exploratory wells, seven have been productive and six were dry holes. Of eight
development wells, seven have been productive. Four fields have been discovered
and have been declared commercial by Ecopetrol. Gross production from the
Santana block has totaled approximately 17.4 million barrels during the period
from April 1992, when production commenced, through December 2001.

     The Aporte Putumayo block produced from 1976 until March 1995, when
declining production caused the block to be unprofitable under the terms of the
contract. The block has been relinquished, however Argosy remains obligated for
abandonment and restoration operations on the old wells in the block.

     Each concession is governed by a separate contract with Ecopetrol.
Generally, the contracts cover a specific period and require certain
exploration expenditures in the early years of the contract and, in the later
years of the contract, permit exploitation of reserves that have been found.
The Santana contract provides that Ecopetrol shall receive, on behalf of the
Colombian Ministry of Mines, royalty payments in the amount of 20% of the gross
proceeds of the oil produced pursuant to the respective contract, less certain
costs of transporting the oil to the point of sale. The Rio Magdalena contract
(and the proposed Guayuyaco contract, see "Item 2. Properties -- Significant
Properties") provides for similar royalty payments, however, the amount of
royalty is calculated on a sliding scale that ranges from 5% (for production up
to 5,000 barrels per day) up to a maximum of 25%. Under each of the contracts,
application must be made to Ecopetrol for a declaration of commerciality for
each discovery. If Ecopetrol declares the discovery commercial, it has the
right to a reversionary interest in the field equal to its specified interest
and is required to pay its share of all future costs. If, alternatively,
Ecopetrol declines to declare the discovery commercial, Argosy has the right to
proceed with development and production at its own expense until such time as
it has recovered 200% of the costs incurred, at which time Ecopetrol is
entitled to back in for a working interest in the field equal to its specified
interest without payment or reimbursement of any historical costs. Exploration
costs (as defined in the contracts) incurred by Argosy prior to the declaration
of commerciality are recovered by means of retention by Argosy of a portion of
the non-royalty proceeds of production from each well until costs relating to
that well are recovered.

     United States. In the United States the Company, through its wholly owned
     -------------
subsidiary, AAI, has been engaged in the production of oil and gas attributable
to its working interests in various wells located in the Gulf of Mexico
offshore Louisiana, at Main Pass 41 and Breton Sound 31 fields. Effective
November 7, 2000, the Company assigned all of its interest in the Main Pass 41
field to the field operator. AAI continues to produce from, and is the operator
of, the Breton Sound 31 field. The Company acquired its interests in these
fields through the acquisition of Charterhall Oil North America PLC in 1990.

     Papua New Guinea. In Papua New Guinea the Company, through its wholly
     ----------------
owned subsidiary, Garnet PNG Corporation ("Garnet PNG"), is engaged in the
exploration for oil and gas attributable to its 2% carried working interest in
Petroleum Prospecting License No. 206 ("PPL-206"). The Company acquired Garnet
PNG as part of the merger with Garnet. See "-- Garnet Merger."

Risks Associated with the Company's Business

     General. The Company's operations are subject to oil field operating
     -------
hazards such as fires, explosions, blowouts, cratering and oil spills, any of
which can cause loss of hydrocarbons, personal injury and loss of life, and can
severely damage or destroy equipment, suspend drilling operations and cause
substantial damage to subsurface structures, surrounding areas or property of
others. As protection against operating hazards, the Company maintains broad
insurance coverage, including indemnity insurance covering well control,
redrilling and cleanup and containment expenses, Outer Continental Shelf Lands
Act coverage, physical damage on certain risks, employers' liability,
comprehensive general liability, appropriate auto and marine liability and
workers' compensation insurance. The Company believes that such insurance
coverage is customary for companies engaged in similar operations, but the
Company may not be fully insured against various of the foregoing risks,
because such risks are either not fully insurable or the cost of insurance is
prohibitive. The Company does not carry business interruption or terrorism
insurance because of the prohibitively high cost. The occurrence of an
uninsured hazardous event could have a material adverse effect on the financial
condition of the Company.

                                      2

<PAGE>

     Colombia. The Company has expended significant amounts of capital for the
     --------
acquisition, exploration and development of its Colombian properties and may
expend additional capital for further exploration and development of such
properties. Even if the results of such activities are favorable, further
drilling at significant cost may be required to determine the extent of and to
produce the recoverable reserves. Failure to fund certain capital expenditures
could result in a decrease in the Company's ownership interest in Argosy or,
possibly, a forfeiture of all or part of the Company's interests in the
applicable property. For additional information on the Company's concession
obligations, see "-- Current Operations," and regarding its cash requirements,
see "Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations -- Liquidity and Capital Resources."

     The Company is subject to the other risks inherent in the ownership and
development of foreign properties including, without limitation, cancellation
or renegotiation of contracts, royalty and tax increases, retroactive tax
claims, expropriation, adverse changes in currency values, foreign exchange
controls, import and export regulations, environmental controls and other laws,
regulations or international developments that may adversely affect the
Company's properties. The Company does not maintain political risk insurance.

     Exploration and development of the Company's Colombian properties are
dependent upon obtaining appropriate governmental approvals and permits. See
"-- Regulation." The Company's Colombian operations are also subject to price
risk. See "-- Products, Markets and Methods of Distribution."

     There are logistical problems, costs and risks in conducting oil and gas
activities in remote, rugged and primitive regions in Colombia. The Company's
operations are also exposed to potentially detrimental activities by the
leftist guerrillas who have operated within Colombia for many years. The
guerrillas in the Putumayo area, where the Company's property is located, have
as recently as August 3, 1998, significantly damaged the Company's assets.
Since that time the Company has been subject to lessor attacks on its pipelines
and equipment resulting in only minor interruptions of oil sales. The Colombian
army guards the Company's operations, however, there can be no assurance that
the Company's operations will not be the target of significant guerrilla
attacks in the future. The damages resulting from the above-referenced attacks
were covered by insurance. During 2001 the cost of such insurance became
prohibitively high and, accordingly, Argosy has elected to no longer maintain
terrorism insurance.

     United States. The Company's activities in the United States are subject
     -------------
to a variety of risks. The U.S. properties could, in certain circumstances,
require expenditure of significant amounts of capital. Failure to fund its
share of such costs could result in a diminution of value of, or under
applicable operating agreements forfeiture of, the Company's interest. The
Company's ability to fund such expenditures is also dependent upon the ability
of the other working interest owners to fund their share of the costs. If such
working interest owners fail to do so, the Company could be required to pay its
proportionate share or forego further development of such properties. The
Company's activities in the United States are subject to various environmental
regulations and to price risk. See "-- Regulation" and "-- Products, Markets
and Methods of Distribution."

     Information concerning the amounts of revenue, operating loss and
identifiable assets attributable to each of the Company's geographic areas is
set forth in Note 10 of the Notes to Consolidated Financial Statements
contained elsewhere herein.

Products, Markets and Methods of Distribution

     Colombia. The Company's oil is sold pursuant to a sales contract with
     --------
Ecopetrol. The contract provides for cancellation by either party with notice.
In the event of cancellation by Ecopetrol, the Company may export its oil
production. Ecopetrol has historically purchased the Company's production, but
there can be no assurance that it will continue to do so, nor can there be any
assurance of ready markets for the Colombian production if Ecopetrol does not
elect to purchase the production. The Company currently produces no natural gas
in Colombia. See "Item 2. Properties."

     During each of the three years ended December 31, 2001, the Company
received the majority of its revenue from Ecopetrol. Sales to Ecopetrol
accounted for $1,253,000 or 59% of oil and gas revenue for 2001, $4,267,000, or
74% of oil and gas revenue for 2000, and $5,683,000, or 84% of oil and gas
revenue for 1999. The foregoing amounts represent the Company's entire
Colombian oil revenue. If Ecopetrol were to elect not to purchase the Company's
Colombian oil production, the Company believes that other purchasers could be
found for such production.

                                      3

<PAGE>

     United States. The Company does not refine or otherwise process domestic
     -------------
crude oil and condensate production. The domestic oil and condensate it
produces are sold to oil transmission companies at posted field prices in the
area where production occurs. The Company does not have long term contracts
with purchasers of its domestic oil and condensate production. The Company's
domestic gas production at Breton Sound 31 is used for field operations and is
recorded at spot prices. The Company has not historically hedged any of its
domestic production.

     During 2001 and 2000, the Company received more than 10% of its revenue
from one domestic purchaser. Such revenue accounted for $782,000, or 37% of oil
and gas revenue for 2001 and $968,000, or 16.7% of oil and gas revenue for
2000. During 1999, the Company did not receive more than 10% of its revenue
from any one domestic purchaser.

     General. Oil and gas are the Company's only products. There is substantial
     -------
uncertainty as to the prices that the Company may receive for production from
its existing oil and gas reserves or from oil and gas reserves, if any, which
the Company may discover or purchase. It is possible that under market
conditions prevailing in the future, the production and sale of oil or gas, if
any, from the Company's properties in Papua New Guinea may not be commercially
feasible. The availability of a ready market and the prices received for oil
and gas produced depend upon numerous factors beyond the control of the Company
including, without limitation, adequate transportation facilities (such as
pipelines), marketing of competitive fuels, fluctuating market demand,
governmental regulation and world political and economic developments. World
oil and gas markets are highly volatile and shortage or surplus conditions
substantially affect prices. As a result, there have been dramatic swings in
both oil and gas prices in recent years. From time to time there may exist a
surplus of oil or natural gas supplies, the effect of which may be to reduce
the amount or price of hydrocarbons that the Company may produce and sell while
such surplus exists.

Regulation

     Environmental Regulation. The Company's operations are subject to foreign,
     ------------------------
federal, state, and local laws and regulations governing the discharge of
materials into the environment or otherwise relating to environmental
protection. These laws and regulations may require the acquisition of a permit
by operators before drilling commences; restrict the types, quantities, and
concentration of various substances that can be released into the environment
in connection with drilling and production activities; limit or prohibit
drilling activities on certain lands lying within wilderness areas, wetlands,
and other protected areas; require remedial measures to mitigate pollution from
former operations, such as plugging and abandoning wells; and impose
substantial liabilities for pollution resulting from the Company's operations.
The regulatory burden on the oil and gas industry increases the cost of doing
business and consequently affects its profitability. Changes in environmental
laws and regulations occur frequently, and any revision or reinterpretation of
existing laws and regulations or adoption of new laws and regulations that
result in more stringent and costly waste handling, disposal, remedial,
drilling, permitting, or operational requirements could have a material adverse
impact on the operating costs of the Company, as well as significantly impair
the Company's ability to compete with larger, more highly capitalized
companies. Management believes that the Company is in substantial compliance
with current applicable environmental laws and regulations and that continued
compliance with existing requirements will not have a material adverse impact
on the Company's operations, capital expenditures, and earnings. Management
further believes, however, that risks of substantial costs and liabilities are
inherent in oil and gas operations, and there can be no assurance that
significant costs and liabilities, including administrative, civil and criminal
penalties for violations of environmental laws and regulations and cleanup
costs for remediation of contaminated properties, will not be incurred. For
more information, please read "Item 3. Legal Proceedings."

     Colombia. Any significant exploration or development of the Company's
     --------
Colombian properties in which it now holds a non-operating interest, such as
conducting a seismic program, the drilling of an exploratory or developmental
well or the construction of a pipeline, requires environmental review and the
issuance of environmental permits by the Ministry of the Environment. In recent
years while it was operator of these Colombian properties, the Company received
environmental permits without substantial delay. There can be, however, no
assurance that the current operator of these Colombian properties will not
experience future delays in obtaining necessary environmental licenses. See
also "Item 2. Properties -- Significant Properties -- Colombia."

     United States. The Company believes that its domestic operations are
     -------------
currently in substantial compliance with U.S. federal, state, and local
environmental laws and regulations. In the past, the Company has incurred
significant costs to make capital improvements, including the drilling and
completion of a salt water

                                      4

<PAGE>

injection well at Breton Sound 31 field, in order to maintain compliance with
these U.S. environmental laws or regulations. There can be no assurance that
the Company will not expend additional significant amounts in the future to
maintain such compliance.

     The Oil Pollution Act of 1990, as amended ("OPA '90"), and regulations
thereunder impose a variety of requirements on "responsible parties" related to
the prevention of oil spills and liability for damages resulting from such
spills in waters of the United States. A "responsible party" includes the owner
or operator of a vessel, pipeline, or onshore facility, or the lessee or
permittee of the area in which an offshore facility is located. OPA '90 assigns
liability to each responsible party for oil spill removal costs and a variety
of public and private damages from oil spills. While liability limits apply in
some circumstances, a party cannot take advantage of liability limits if the
spill is caused by gross negligence or willful misconduct, the spill resulted
from violation of a federal safety, construction, or operating regulation, or a
party fails to report a spill or to cooperate fully in the cleanup. Few
defenses exist to the liability imposed under OPA '90 for oil spills. The
failure to comply with these requirements or inadequate cooperation in a spill
event may subject a responsible party to civil or criminal enforcement actions.
Management of the Company is currently unaware of any oil spills for which the
Company has been designated as a responsible party under OPA '90 and that will
have a material adverse impact on the Company or its operations. OPA '90 also
imposes ongoing requirements on facility operators, such as the preparation of
an oil spill contingency plan. The Company has such plans in place.

     The Company's U.S. property at Breton Sound Block 31 field, on state
leases offshore Louisiana, is subject to OPA '90. Under OPA '90 and a final
rule adopted by the U.S. Minerals Management Service ("MMS") in August 1998,
owners and operators of covered offshore facilities that have a worst case oil
spill of more than 1,000 barrels must demonstrate financial responsibility in
amounts ranging from $10 million in specified state waters to $35 million in
federal outer continental shelf ("OCS") waters, with higher amounts of up to
$150 million in certain limited circumstances where the MMS believes such a
level is justified by the risks posed by operations at such covered offshore
facilities or if the worst case oil-spill discharge volumes possible at such
facilities may exceed the applicable threshold volumes specified under the MMS
final rule. The Company believes that it currently has established adequate
proof of financial responsibility for its covered offshore facilities in
Louisiana State waters. However, the Company cannot predict whether these
financial responsibility requirements under the OPA '90 amendments or the MMS
final rule will result in the imposition of significant additional annual costs
to the Company in the future or otherwise have a material adverse effect on the
Company. The impact of financial responsibility requirements is not expected to
be any more burdensome to the Company than it will be to other similarly or
less capitalized owners or operators in the Gulf of Mexico.

     The Comprehensive Environmental Response, Compensation, and Liability Act
("CERCLA"), also known as the "Superfund" law, and analogous state laws impose
liability, without regard to fault or the legality of the original conduct, on
certain classes of persons that are considered responsible for the release of a
"hazardous substance" into the environment. These persons include the owner or
operator of the disposal site or sites where the release occurred and companies
that disposed or arranged for the disposal of hazardous substances found at the
site. Persons who are or were responsible for releases of hazardous substances
under CERCLA may be subject to joint and several liability for the costs of
cleaning up the hazardous substances that have been released into the
environment and for damages to natural resources, and it is not uncommon for
neighboring landowners and other third parties to file claims for personal
injury, property damage and recovery of response costs allegedly caused by the
hazardous substances released into the environment. The Company has not
received any notification nor does it otherwise know of circumstances
indicating that it may be potentially responsible for cleanup costs under
CERCLA.

     The federal Resource Conservation and Recovery Act ("RCRA") and comparable
state statutes regulate the storage, treatment and disposal of wastes,
including hazardous wastes. The EPA and various state agencies have limited the
approved methods of disposal for certain hazardous and nonhazardous wastes,
thereby making such disposal more costly. Furthermore, certain wastes generated
by the Company's oil and natural gas operations that are currently exempt from
treatment as hazardous wastes may in the future be designated as hazardous
wastes and therefore be subject to more rigorous and costly operating and
disposal requirements.

     Other Regulation - Colombia. The Company's Colombian operations, in which
     ---------------------------
it now holds a non-operating interest, are regulated by Ecopetrol, the Ministry
of Mines and Energy, and the Ministry of the Environment, among others. Current
environmental laws, regulations and the administration and enforcement thereof,
or the passage of new environmental laws or regulations in Colombia, could
result in substantial costs and liabilities in the future or in delays in
obtaining the necessary permits to conduct these Colombian operations. These
operations may also be

                                      5

<PAGE>

affected from time to time in varying degrees by political developments in
Colombia. Such political developments could result in cancellation or
significant modification of the Company's contract rights with respect to such
properties, or could result in tax increases and/or retroactive tax claims
being assessed against the Company.

     Other Regulation - United States. Domestic exploration for and production
     --------------------------------
and sale of oil and gas are extensively regulated at both the national and
local levels. Legislation affecting the oil and gas industry is under constant
review for amendment or expansion, frequently increasing the regulatory burden.
Also, numerous departments and agencies, both federal and state, are authorized
by statute to issue, and have issued, rules and regulations applicable to the
oil and gas industry that are often difficult and costly to comply with and
that may carry substantial penalties for failure to comply. The regulations
also generally specify, among other things, the extent to which acreage may be
acquired or relinquished, permits necessary for drilling of wells, spacing of
wells, measures required for preventing waste of oil and gas resources and, in
some cases, rates of production. The heavy and increasing regulatory burdens on
the oil and gas industry increase the costs of doing business and,
consequently, affect profitability.

     Sales of crude oil, condensate and gas liquids by the Company are not
currently regulated and are made at market prices. In a number of instances,
however, the ability to transport and sell such products is dependent on
pipelines whose rates, terms and conditions of service are subject to the
Federal Energy Regulatory commission ("FERC") jurisdiction under the Interstate
Commerce Act and, possibly, the Energy Policy Act of 1992. Certain regulations
implemented by the FERC in recent years could result in an increase in the cost
of transportation service on certain pipelines. However, the Company does not
believe that these regulations affect it any differently than others.

     The Company cannot accurately predict the effect that any of the
aforementioned orders or the challenges to the orders will have on the
Company's operations. Additional proposals and proceedings that might affect
the oil industry are pending before Congress, the FERC and the courts. The
Company cannot accurately predict when or whether any such proposals or
proceedings may become effective.

     State Regulation. Production of any domestic oil and gas by the Company is
     ----------------
affected by state regulations. Many states in which the Company has operated
have statutory provisions regulating the production and sale of oil and gas,
including provisions regarding deliverability. Such statutes, and the
regulations promulgated in connection therewith, are generally intended to
prevent waste of oil and gas and to protect correlative rights to produce oil
and gas between owners of a common reservoir. Such regulations include
requiring permits for the drilling of wells, maintaining bonding requirements
in order to drill or operate wells, and regulating the location of wells, the
method of drilling and casing wells, the surface use and restoration of
properties upon which wells are drilled, the plugging and abandoning of wells,
and the disposal of fluids used in connection with operations.

     The Company's operations are also subject to various conservation laws and
regulations including the regulation of the size of drilling and spacing units
or proration units, the density of wells that may be drilled, and the
unitization or pooling of oil and gas properties. In addition, state
conservation laws establish maximum rates of production from oil and natural
gas wells, generally prohibit the venting or flaring of natural gas, and impose
certain requirements regarding the ratability of production. The effect of
these regulations may limit the amount of oil and natural gas that the Company
can produce from its wells and may limit the number of wells or the locations
at which the Company can drill. Inasmuch as such laws and regulations are
periodically expanded, amended and reinterpreted, the Company is unable to
predict the future cost or impact of complying with such regulations; however,
the Company does not believe it will be affected by these laws and regulations
materially differently than the other oil and natural gas producers with which
it competes.

     Other Regulations - Papua New Guinea. The Company's Papua New Guinea
     ------------------------------------
operations, in which it holds a non-operating interest, are currently governed
by the Department of Petroleum and Energy, which has jurisdiction over all
petroleum exploration in that country. In the event the Company develops and
operates a petroleum business in Papua New Guinea, the Company will be subject
to regulation by the Investment Promotion Authority, which regulates almost all
business operations with significant foreign equity or with foreign management
control.

Competition

     The Company encounters strong competition from other independent operators
and from major oil companies in acquiring properties suitable for exploration,
in contracting for drilling equipment and in securing trained personnel.

                                      6

<PAGE>

Many of these competitors have financial and other resources substantially
greater than those available to the Company.

     The Company's ability to discover reserves in the future depends on its
ability to select, generate and acquire suitable prospects for future
exploration. The Company does not currently generate its own prospects and
depends exclusively upon external sources for the generation of oil and gas
prospects.

Employees

     As of December 31, 2001, Aviva had 7 full-time employees.

ITEM 2. PROPERTIES

Productive Wells and Drilling Activity

     The following table summarizes the Company's developed acreage and
productive wells at December 31, 2001. "Gross" refers to the total acres or
wells in which the Company has a working interest, and "net" refers to gross
acres or wells multiplied by the percentage working interest owned by the
Company.

Developed Acreage (1)

                              Gross              Net
                           --------          -------
United States                 1,387            1,003
Colombia (2)                 3,706              384
                           --------          -------
                              5,093            1,387
                           ========          =======

Productive Wells (3)
                                  Oil                      Gas
                          ---------------------    ---------------------
                             Gross           Net      Gross           Net
                           -------        ------    -------        ------

United States                    7          4.93          3          2.30
Colombia                        14          1.45          -             -
                           -------        ------    -------        ------
                                21          6.38          3          2.30
                           =======        ======    =======        ======

(1)  Developed acreage is acreage assignable to productive wells.
(2)  Excludes Aporte Putumayo acreage pending abandonment operations.
(3)  Productive wells represent producing wells and wells capable of
     producing.

     During the period from January 1, 1999 through December 31, 2001, the
Company did not drill nor participate in the drilling of any development or
exploratory wells.

Undeveloped Acreage

     The Company's undeveloped acreage in Colombia is held pursuant to the
Santana and Rio Magdalena contracts with the Colombian government. No further
relinquishments are required for the Santana contract until the expiration of
the contract in 2015. The Rio Magdalena contract may, by operation of its
terms, require the relinquishment of certain portions of the undeveloped
acreage in 2007, 2009 and 2011. See "-- Significant Properties."

     The Company's undeveloped acreage in Papua New Guinea is held pursuant to
PPL-206. See "-- Significant Properties."

     The Company does not have an undeveloped acreage position in the United
States because of the costs of maintaining such a position. Oil and gas leases
in the United States generally can be acquired by the Company for specific
prospects on reasonable terms either directly or through farmout arrangements.

                                      7

<PAGE>

     The following table shows the undeveloped acreage held by the Company at
December 31, 2001. Undeveloped acreage is acreage on which wells have not been
drilled or completed to a point that would permit the production of commercial
quantities of oil and gas, regardless of whether such acreage contains proved
reserves.

                        Undeveloped Acres
                   ------------------------
                       Gross            Net
                   ---------         ------

Colombia
   Santana            48,636         14,406
   Rio Magdalena     144,609         14,991
Papua New Guinea   1,228,187         24,564
                   ---------         ------
                   1,421,432         53,961
                   =========         ======

Title to Properties

     The Company has not performed a title examination for offshore U.S. leases
in federal waters because title emanates from the United States government.
Title examinations also are not performed in Colombia, where mineral title
emanates from the national government. The Company believes that it generally
has satisfactory title to all of its oil and gas properties. The Company's
working interests are subject to customary royalty and overriding royalty
interests generally created in connection with their acquisition, liens
incident to operating agreements, liens for current taxes and other burdens and
minor liens, encumbrances, easements and restrictions. The Company believes
that none of such burdens materially detracts from the value of such properties
or its interest therein or will materially interfere with the use of the
properties in the operation of the Company's business.

Reserves and Future Net Cash Flows

     See Supplementary Information Related to Oil and Gas Producing Activities
in "Item 8. Financial Statements and Supplementary Data" for information with
respect to the Company's reserves and future net cash flows.

     The Company will file with the Department of Energy (the "DOE") a
statement with respect to the Company's estimate of proved oil and gas reserves
as of December 31, 2001, that is not the same as that included in the estimate
of proved oil and gas reserves as of December 31, 2001, as set forth in "Item
8. Financial Statements and Supplementary Data" elsewhere herein. The
information filed with the DOE includes the estimated proved reserves of the
properties of which the Company is the operator, whereas the estimated proved
reserves contained in Item 8 hereof include only the Company's percentage share
of the estimated proved reserves of all properties in which the Company has an
interest.

Production, Sales Prices and Costs

     The following table summarizes the Company's oil production in thousands
of barrels and natural gas production in millions of cubic feet for the years
indicated:

                                     Year ended December 31,
                                ----------------------------------

                                  2001          2000          1999
                                ------        ------        ------

Oil (1)       United States         33            49            57
              Colombia              61           157           365

Gas           United States         24            25            53
              Colombia               -             -             -

(1) Includes crude oil and condensate.

                                      8

<PAGE>

     The average sales price per barrel of oil and per thousand cubic feet
("MCF") of gas produced by the Company and the average production (lifting)
cost per dollar of oil and gas revenue and per barrel of oil equivalent (6 MCF:
1 barrel) were as follows for the years indicated:

<TABLE>
<CAPTION>
                                                                Year ended December 31, (1)
                                                           ----------------------------------

                                                               2001         2000         1999
                                                           --------     --------     --------
<S>                                         <C>            <C>          <C>          <C>
Average sales price per barrel of oil(2)    United States  $  23.93     $  28.94     $  17.13
                                            Colombia       $  20.67     $  27.18     $  15.57

Average sales price per MCF of gas          United States  $   4.27     $   4.11     $   2.42
                                            Colombia       $      -     $      -     $      -

Average production cost per dollar of
   oil and gas revenue                      United States  $   0.89     $   0.72     $   1.05
                                            Colombia       $   0.49     $   0.31     $   0.42

Average production cost per barrel of
   oil equivalent                           United States  $  21.41     $  20.59     $  17.69
                                            Colombia       $  10.18     $   8.33     $   6.58
</TABLE>

(1)  All amounts are stated in United States dollars.
(2)  Includes crude oil and condensate.

Significant Properties

     Colombia.
     --------
     The Company's Colombian properties currently consist of three contracts,
two of which are located in the Putumayo Basin in southwestern Colombia along
the eastern front of the eastern cordillera of the Andes Mountains. The Rio
Magdalena contract, covering approximately 145,000 acres, is located in central
Colombia in the prolific Upper Magdalena region. The Company's interest in each
of the contracts is subject to certain reversionary interests in favor of
Ecopetrol as described below. Argosy, as operator of the properties, carries
out the program of operations for the three concessions. The program is
determined by Argosy and approved by Ecopetrol. The Santana contract, which now
consists of approximately 52,000 acres and contains 14 productive wells, has
been in effect since 1987 and is the focus of the Company's current production
activities. Argosy expects to sign a fourth contract, the Guayuyaco contract,
in April 2002. The Guayuyaco and Rio Magdalena contracts are the focus of the
Company's exploration activities.

     The Aporte Putumayo block, which consisted of approximately 77,000 acres
and contains three shut-in wells, produced from 1976 to 1995. The block has
been relinquished, however Argosy remains obligated for abandonment and
restoration operations on the old wells in the block.

     Production from the Santana concession is sold pursuant to a sales
contract with Ecopetrol. The contract provides that at least 25% of the sales
proceeds will be paid in Colombian pesos. As a result of certain currency
restrictions, pesos resulting from these payments must generally remain in
Colombia and are used by the Company to pay local expenses.

     The Company's pretax income from Colombian sources, as defined under
Colombian law, is subject to Colombian income taxes at a statutory rate of 35%,
although a "presumptive" minimum income tax based on net assets, as defined
under Colombian law, may apply in years of little or no net income. The
Company's income after Colombian income taxes is subject to a Colombian
remittance tax that accrues at a rate of 7%. Payment of the remittance tax may
be deferred under certain circumstances if the Company reinvests such income in
Colombia.

     Santana Contract. The Santana block is held pursuant to a "risk-sharing"
     ----------------
contract for which Ecopetrol has the option to participate on the basis of a
30% working interest in exploration activities in the contract area. If a
commercial field is discovered, Ecopetrol's working interest increases to 50%
and the costs theretofore incurred and attributable to the 20% working interest
differential will be recouped by Argosy from Ecopetrol's share of production on
a well by well basis. The risk-sharing contract provides that, when 7 million
barrels of cumulative production from

                                      9

<PAGE>

the concession have been attained, Ecopetrol's revenue interest and share of
operating costs increases to 65% but it remains obligated for only 50% of
capital expenditures. In June 1996, the 7 million barrel threshold was reached.
At that time, Argosy's revenue interest in the contract declined from 40% to
28% and its share of operating expenses declined from 50% to 35%.

     The Santana block is divided by the Caqueta River. Two fields located
south of the river, the Toroyaco and Linda fields, were declared commercial by
Ecopetrol and commenced production in 1992. There are currently four producing
wells in the Toroyaco field and four producing wells in the Linda field. During
1995, a 3-D seismic survey covering the Toroyaco and Linda fields was
completed. Based on this survey, one development well was drilled in each field
during 1996 and one additional development well was drilled in the Linda field
in 1997. No further drilling is anticipated for these fields.

     The Company constructed a 42-kilometer pipeline (the "Uchupayaco
Pipeline") which was completed and commenced operations during 1994 to
transport oil production from the Toroyaco and Linda fields to the Trans-Andean
Pipeline owned by Ecopetrol, through which the Company's production is
transported to the port of Tumaco on the Pacific coast of Colombia.

     Two additional fields, the Mary and Miraflor fields, were discovered north
of the Caqueta River and were declared commercial by Ecopetrol during 1993.
Except for oil produced during production tests of wells located in these
fields, the production was shut-in until the first quarter of 1995 when
construction of a pipeline was completed and commercial production began.
Completion of this pipeline provided the Company with direct pipeline access
from all of its fields to the Pacific coast port of Tumaco. There are currently
four producing wells in the Mary field and one producing well in the Miraflor
field. A 3-D seismic survey was completed over the Mary and Miraflor fields
during early 1997. Although the survey confirmed that additional development
drilling is not required for the Miraflor field, it did confirm the presence of
several prospects and leads previously identified from two-dimensional seismic
data. These prospects and leads are now covered by the Guayuyaco contract
described below.

     Argosy has fulfilled all the exploration obligations required by the
Santana risk-sharing contract. The current work program contemplates the
recompletion of certain existing wells to increase production therefrom.

     The Santana contract has a term of 28 years and expires in 2015. In 1993,
the Company relinquished 50% of the original Santana area in accordance with
the terms of the contract. In July 1995, an additional 25% of the original
contract area was relinquished. A final relinquishment was made in 1997 such
that all remaining contract areas except for those areas within five kilometers
of a commercial field were relinquished.

     All oil produced from the Santana contract area is sold to Ecopetrol
pursuant to the terms of the applicable sales contract with Ecopetrol. The
contracts applicable to periods prior to December 1, 2001 generally provided
that if Ecopetrol exported the oil, the price paid was the export price
received by Ecopetrol, adjusted for quality differences, less a marketing fee
of $0.165 per barrel. If Ecopetrol did not export the oil, the price paid was
based on the price received from Ecopetrol's Cartagena refinery, adjusted for
quality differences, less Ecopetrol's cost to transport the crude to Cartagena
and a marketing fee of $0.165 per barrel.

     Effective December 1, 2001, Argosy entered into a new sales contract with
Ecopetrol whereby the price paid, adjusted for quality differences, for each
barrel of oil sold is determined based on the monthly average of West Texas
Intermediate - Cushing ("WTI") less a variable differential as follows:

Average WTI ("US$/bbl.")      Contract Sales Price
------------------------      --------------------

$15 or less                   Ave. WTI less $4.38 per bbl.
$15.01 to $20.00              Ave. WTI less $4.88 per bbl.
$20.01 to $25.00              Ave. WTI less $5.38 per bbl.
$25.01 to $30.00              Ave. WTI less $6.38 per bbl.
Over $30                      Ave. WTI less $7.38 per bbl.

     In 2001, Ecopetrol exported the crude each month through October. November
and December crude sales were sent to Ecopetrol's Cartagena refinery. The 2001
crude sales price averaged $20.67 per barrel.

                                      10

<PAGE>

          Rio Magdalena Contract. The Rio Magdalena contract, acquired by
          ----------------------
Argosy in December 2001, is an "association" contract whereunder Argosy and a
50% co-owner fulfill all exploration obligations without Ecopetrol's
participation until a field is declared commercial by Ecopetrol, whereupon
Ecopetrol will earn an initial 30% share in the field and must reimburse its
30% share of successful exploratory wells, seismic and stratigraphic wells, dry
step-out exploratory wells and development wells and facilities through its 30%
share of production. The contract provides that Ecopetrol's working interest
will be 30% until aggregate oil production from the contract area reaches 60
million barrels. For production in excess of 60 million barrels, Ecopetrol's
interest will increase from 30% to 65% based on a measure of profitability as
defined in the contract.

     The contract obligations of the Rio Magdalena contract require Argosy and
its co-owner to reprocess 40 kilometers of 2D seismic during the initial
18-month exploration phase of the contract. In the following 12-month
exploration phase, Argosy and its co-owner are obligated to perform one of the
following: (i) a seismic survey to acquire 30 kilometers of 3D seismic; (ii) a
seismic survey to acquire 2D seismic at a cost equivalent to the 3D program; or
(iii) drill an exploratory well. If Argosy and its co-owner decide to proceed
into the third phase of the contract, the drilling of an exploratory well would
be required. If a field is discovered, the exploitation period is 22 years in
the case of an oil discovery and 30 years, extendable to 40 years under certain
circumstances, in the case of a natural gas discovery. Argosy has not yet
completed the seismic reprocessing required in the first phase of the contract.
Such reprocessing is currently underway.

          Guayuyaco Contract. The Guayuyaco contract, expected to be signed by
          ------------------
Argosy in April 2002, will be an "association" contract that overlays the
undeveloped acreage contained within the Santana contract area. Under the
proposed Guayuyaco contract, Argosy will fulfill all exploration obligations
without Ecopetrol's participation until a field is declared commercial by
Ecopetrol, whereupon Ecopetrol will earn an initial 30% share in the field and
must reimburse its 30% share of direct exploration costs, as defined in the
contract, through payment of 50% of its 30% share of production. The proposed
contract provides that Ecopetrol's working interest will be 30% until aggregate
oil production from the contract area reaches 60 million barrels. For
production in excess of 60 million barrels, Ecopetrol's interest will increase
from 30% to 65% based on a measure of profitability as defined in the contract.

     The proposed obligations of the Guayuyaco contract will require Argosy to
drill one exploratory well during the initial 12-month exploration phase of the
contract. Upon completion of the initial exploration phase, Argosy may
relinquish the contract or proceed to the following 18-month exploration phase,
whereunder Argosy will be obligated to drill a second exploratory well. The
contract will terminate following the second phase if, not having discovered a
field, Argosy does not request an extension to the contract. Upon request by
Argosy, Ecopetrol may extend the contract an additional three years obligating
Argosy to drill one exploration well in each of the three years of the
extension. If a field is discovered, the exploitation period is 22 years in the
case of an oil discovery and 30 years in the case of a natural gas discovery.
Argosy is continuing its efforts to secure an industry partner to farm-in to
this acreage and expects to drill the first exploratory well during the second
quarter of 2003.

     Failure by Argosy to meet the obligations under the proposed contract will
result in the loss of the proposed contract terms. The existing Santana
production and acreage will not be affected. Failure by the Company to fund its
share of Argosy's obligations under the proposed contract, assuming Argosy
funds the obligation, could result in a decrease in the Company's ownership
interest in Argosy.

     United States.
     -------------
     The Company's remaining oil and gas properties in the United States are
located in the Gulf of Mexico offshore Louisiana at Breton Sound 31 field. The
Breton Sound 31 field is operated by the Company.

     Breton Sound Block 31 is located 20 miles offshore Louisiana in 16 feet of
water. The field is approximately 55 miles southeast of New Orleans on state
leases. During 2001, five wells averaged 90 barrels of oil per day and 65 MCF
of gas per day, net to the Company's interest, from three sands completed
between 3,850 feet and 6,500 feet. The Company's working interests in the
leases comprising the field vary from 64% to 90%.

     The interpretation of 3-D seismic data in 1996 identified two deep and
several shallow prospects in the Breton Sound Block 31 field.

     On June 1, 2000, the Company signed a farmout agreement covering the deep
prospects. The farmee was unable to conclude a drilling arrangement prior to
June 30, 2001, the date to which the contract had been extended.

                                      11

<PAGE>

     During the latter part of 2001, an offset operator drilled a successful
exploratory well approximately 4,000 feet from the eastern boundary of the
Company's Breton Sound acreage. Management of the Company is currently in
discussions with such operator, and other interested parties, with a view
towards negotiating an arrangement to explore the Company's Breton Sound
prospects.

     Papua New Guinea.
     ----------------
     The area covered by PPL-206 is located in the Western, Gulf and Southern
Highland Provinces of Papua New Guinea. The northern section of the area is in
a mountainous tropical rain forest while the southern section of the area is
predominantly lowlands, jungle and coastal swamps. In 1986 oil was discovered
approximately 20 kilometers from the northern border of PPL-206 in an adjoining
license area and in 1999 gas was discovered approximately 20 kilometers
southwest of the western border.

     In accordance with the terms of the agreement governing PPL-206, the
parties have performed surface geological work and completed seismic programs
during 1998 and 2000. The 2000 program (the "Okoni Program") was followed by
strike line acquisition in the first quarter of 2001 to determine the drilling
location for the Bosavi exploratory well. Site preparation is currently
underway and drilling of the Bosavi well is scheduled to begin in August 2002.

     Pursuant to the Company's 2% carried working interest, the Company is not
obligated to pay any of the costs relative to the work presently underway nor
is it obligated to pay any of the costs of drilling, testing or completing the
exploratory well.

     Under the provisions of PPL-206 the terms of any oil and gas development
are set forth in a Petroleum Agreement with the Government of Papua New Guinea.
The Petroleum Agreement provides that the operator must carry out an appraisal
program after a discovery to determine whether the discovery is of commercial
interest. If the appraisal is not carried out or the discovery is not of
commercial interest, the license may be forfeited. If the discovery is of
commercial interest, the operator must apply for a Petroleum Development
License. The Government retains a royalty on production equal to 1.25% of the
wellhead value of the petroleum and, at its election, may acquire up to a 22.5%
interest in the petroleum development after recoupment by the operator of the
project costs attributable thereto out of production. In addition, income from
petroleum operations is subject to a Petroleum Income Tax at the rate of 50% of
net income, which is defined as gross revenue less royalties, allowances for
depreciation, interest deductions, operating costs and previous tax losses
carried forward. An Additional Profits Tax of 50% of cash flow (after deducting
ordinary income tax payments) is also payable when the accumulated value of net
cash flows becomes positive. For annual periods in which net cash flows are
negative, the cumulative amount is carried forward and increased at an annual
accumulation of 27%. The Additional Profits Tax is calculated separately for
each Petroleum Development License. In calculating the applicable tax, interest
expenses paid by Garnet PNG prior to the issuance of a Petroleum Development
License and, thereafter, to the extent that Garnet PNG's debt to equity ratio
exceeds two-to-one, are not deductible.

     The Company leases corporate office space in Dallas, Texas containing
approximately 5,100 square feet pursuant to a lease which expires in January
2007. The annual lease payments for these offices are approximately $94,000.

ITEM 3. LEGAL PROCEEDINGS

     In "Terrebonne Parish School Board v. Quintana Petroleum Corporation, et
al.," Case No. 00-0443, Sect. T (2) in the United States District Court for the
Eastern District of Louisiana, the Terrebonne Parish School Board, also
referred to as the "Board," has sued various oil and gas companies, including
the Company, alleging that they dredged canals and moved equipment across Board
property for the purpose of developing the minerals thereunder, but
subsequently failed to restore the surface of the property, thus causing
erosion to Louisiana coastal wetlands. The Company's involvement, as a
successor to Jackson Exploration, Inc., with respect to any such Board property
was brief, and records from the period are scarce. This lawsuit is currently
stayed by this District Court pending resolution of an appeal made to the
United States Court of Appeals for the Fifth Circuit of an unrelated case in
which this same District Court granted summary judgment to the defendants for
the same type of claims being made in this lawsuit because such claims were
barred by Louisiana's limitation doctrine. Based on current information,
Management of the Company does not expect this lawsuit to have a materially
adverse effect on the Company's results of operations.

                                      12

<PAGE>

     There are no other legal proceedings to which the Company is a party or to
which its properties are subject which are, in the opinion of management,
likely to have a material adverse effect on the Company's results of operations
or financial condition.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     There were no matters submitted to a vote of security holders during the
fourth quarter of the Company's fiscal year ended December 31, 2001.

                                    PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

Price Range of Depositary Shares and Common Stock

     The Company's Depositary Shares, each representing the beneficial
ownership of five shares of Common Stock, traded on the OTC Bulletin Board (the
"OTCBB") from May 13, 1999 until April 30, 2001, when the Company discontinued
trading of the Depositary Shares. On May 16, 2001, the Common Shares began
trading on the OTCBB under the symbol "AVVP". During 2001, an aggregate of
2,190,400 Depositary Shares and 2,052,200 Common Shares were traded on the
OTCBB.

     The following table sets forth, for the periods indicated, the high and
low prices for the Depositary Shares and the Common Stock on the OTCBB.

                                   2001                2000
                          ---------------------   -----------------
                              High         Low      High       Low
                          --------   ---------   -------   -------
OTC Bulletin Board:

   Common Stock
   ------------
   First Quarter          $    n/a    $    n/a   $   n/a   $   n/a
   Second Quarter         $   0.17    $   0.06   $   n/a   $   n/a
   Third Quarter          $   0.10    $   0.05   $   n/a   $   n/a
   Fourth Quarter         $   0.11    $   0.05   $   n/a   $   n/a

   Depositary Shares(1)
   ----------------------
   First Quarter          $   0.38    $   0.15  $   0.25  $   0.06
   Second Quarter         $   0.40    $   0.20  $   0.38  $   0.06
   Third Quarter          $    n/a    $    n/a  $   0.38  $   0.13
   Fourth Quarter         $    n/a    $    n/a  $   0.38  $   0.06

(1) Representing five shares of Common Stock.

     As of February 28, 2002, the Company had approximately 4,400 shareholders
of record, including nominees for an undetermined number of beneficial holders.

                                      13

<PAGE>

Dividend History and Restrictions

     No dividends have been paid since June 1983, nor is there any current
intention on the part of the directors of the Company to pay dividends in the
future.

ITEM 6. SELECTED FINANCIAL DATA

     The following table summarizes certain selected financial data with
respect to the Company for, and as of the end of, each of the five years ended
December 31, 2001, which should be read in conjunction with the Consolidated
Financial Statements included elsewhere herein.

<TABLE>
<CAPTION>
                                                             For the Years Ended
                                                                  December 31,
                                   ---------------------------------------------------------------------
                                        2001          2000           1999           1998            1997
                                   ---------      --------      ---------      ---------       ---------
                                        (in thousands, except per share, per barrel and per MCF data)
<S>                                <C>            <C>           <C>            <C>             <C>
For the period
   Revenues                        $   2,609      $  6,183      $   6,797      $   3,332       $   9,726
   Earnings (loss) before
      extraordinary item           $      77      $  4,961      $    (403)     $ (16,881)      $ (22,482)
   Extraordinary item -
      debt extinguishment          $       -      $  5,543      $      -       $    (197)      $       -
   Net earnings (loss)             $      77      $ 10,504      $    (403)     $ (17,078)      $ (22,482)
   Earnings (loss) before
      extraordinary item
      per common share             $    0.00      $   0.10      $   (0.01)     $   (0.49)      $   (0.71)
   Basic and diluted net
      earnings (loss)
      per common share             $    0.00      $   0.22      $   (0.01)     $   (0.50)      $   (0.71)
   Weighted average
      shares outstanding              46,900        46,900         46,813         34,279          31,483
   Cash dividends per
      common share                 $       -      $      -      $       -      $       -       $       -
   Total annual net oil
      production (barrels)
         Colombia                         61           157            365            255             426
         United States                    33            49             57             44              76
                                   ---------      --------      ---------      ---------       ---------
            Total                         94           206            422            299             502
                                   ---------      --------      ---------      ---------       ---------

   Total annual net gas
      production (MCF)
         United States                    24            25             53             68             316

   Average price per barrel
      of oil
         Colombia                  $   20.67      $  27.18      $   15.57      $   10.31      $    17.39
         United States             $   23.93      $  28.94      $   17.13      $   12.03      $    19.17
   Average price per MCF of
      Gas - United States          $    4.27      $   4.11      $    2.42      $    2.42      $     2.73

At period end
   Total assets                    $   3,134      $  3,311      $   8,986      $  11,422      $   16,445
   Long term debt, including
      current portion              $       -      $      -      $  14,495      $  14,805      $    7,690
   Stockholders' equity (deficit)  $   1,953      $  1,876      $ (11,483)     $ (11,083)     $    3,748
</TABLE>

In connection with the application of the full cost method, the Company
recorded ceiling test write-downs of oil and gas properties of $12,343,000 in
1998 and $19,953,000 in 1997 (see Note 1 of Notes to Consolidated Financial
Statements).

                                      14

<PAGE>

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS.

     The following discussion and analysis should be read in conjunction with
the Consolidated Financial Statements included elsewhere herein.

Critical Accounting Policies

     The Company's significant accounting policies are included in Note 1 to
the Consolidated Financial Statements. These policies, along with the
underlying assumptions and judgments made by the Company's management in their
application, have a significant impact on the Company's consolidated financial
statements. The Company identifies its most critical accounting policies as
those that are the most pervasive and important to the portrayal of the
Company's financial position and results of operations, and that require the
most difficult, subjective and/or complex judgments by management regarding
estimates about matters that are inherently uncertain. The Company's most
critical policies are those related to property and equipment and impairment of
assets.

Results of Operations

2001 versus 2000
----------------
                                          United States    Colombia
                                          Oil       Gas      Oil       Total
                                       --------   ------   --------   --------
          (Thousands)

          Oil and gas sales - 2000     $  1,428   $  100   $  4,268   $  5,796

          Volume variance                  (482)     (28)    (2,584)    (3,094)

          Price variance                   (164)      29       (431)      (566)
                                       --------   ------   --------   --------

          Oil and gas sales - 2001     $    782   $  101   $  1,253   $  2,136
                                       ========   ======   ========   ========

     Colombian oil volumes were 61,000 barrels in 2001, a decrease of 96,000
barrels from 2000. Such decrease is due to an 84,000 barrel decrease resulting
from the transfer of partnership interests to Crosby on June 8, 2000 and a
19,000 barrel decrease resulting from production declines, partially offset by
a 7,000 barrel increase due to the transfer of a 7.5% partnership interest to
Aviva from Crosby on August 14, 2001 (see note 2 of the consolidated financial
statements included elsewhere herein).

     U.S. oil volumes were 33,000 barrels in 2001, down approximately 16,000
barrels from 2000. Such decrease is primarily due to the relinquishment of Main
Pass 41 effective November 7, 2000. U.S. gas volumes were 24,000 MCF in 2001,
down 1,000 MCF from 2000. Such decrease is due to the relinquishment of Main
Pass 41 as discussed above.

     Colombian oil prices averaged $20.67 per barrel during 2001. The average
price for the same period in 2000 was $27.18 per barrel. The Company's average
U.S. oil price decreased to $23.93 per barrel in 2001, down from $28.94 per
barrel in 2000. In 2001 prices were lower than in 2000 due to an overall
decrease in world oil prices. U.S. gas prices averaged $4.27 per MCF in 2001
compared to $4.11 per MCF in 2000.

     Service fees of $473,000 for administering the Colombian assets were
received in 2001 compared to $387,000 in 2000. The 2001 amount covers three
months at a monthly rate of $71,000 and nine months at a monthly rate of
$46,000. The 2000 amount covers seven months at a monthly rate of $71,000. The
recorded amounts are net of Aviva Overseas' 22.1196% (29.6196% after August 14,
2001) share of the fees.

     Operating costs decreased approximately 42%, or $1,005,000, primarily as a
result of the transfer of partnership interests to Crosby.

     Depreciation, depletion and amortization ("DD&A") decreased by 38%, or
$195,000, primarily as a result of the transfer of partnership interests to
Crosby and a decrease in the amount of oil produced.

                                      15

<PAGE>

     General and administrative ("G&A") expenses decreased $151,000 or 13%
primarily as a result of the reversal of over accrued public ownership costs,
lower state franchise taxes, lower legal fees and lower stock-based
compensation.

     During 2000, in connection with the restructuring of the Company's
long-term debt, the Company realized a $3,452,000 gain on the transfer of
partnership interests to Crosby and an extraordinary gain of $5,543,000, net of
income taxes of $2,855,000, on the extinguishment of a portion of the debt.
There were no similar gains during 2001.

     Interest expense decreased $802,000 in 2001 due to the extinguishment of
the Company's long-term debt in 2000.

     Income taxes were $169,000 lower in 2001 principally as a result of the
net transfer of partnership interests to Crosby.

2000 versus 1999
----------------
                                          United States    Colombia
                                          Oil      Gas       Oil       Total
                                       --------   -----    -------    --------
          (Thousands)

          Oil and gas sales - 1999     $   987    $ 127    $ 5,683    $  6,797

          Volume variance                 (141)     (90)    (3,671)     (3,902)

          Price variance                   582       66      2,256       2,904

          Other                              -       (3)         -          (3)
                                       -------    -----    -------    --------

          Oil and gas sales - 2000     $ 1,428    $ 100    $ 4,268    $  5,796
                                       =======    =====    =======    ========

     Colombian oil volumes were 157,000 barrels in 2000, a decrease of 208,000
barrels from 1999. Such decrease is due to a 108,000 barrel decrease resulting
from the transfer of partnership interests to Crosby and a 100,000 barrel
decrease resulting from production declines.

     U.S. oil volumes were 49,000 barrels in 2000, down approximately 8,000
barrels from 1999, primarily due to normal production declines. U.S. gas
volumes before gas balancing adjustments were 24,000 MCF in 2000, down 26,000
MCF from 1999. Such decrease is due to a significant decline in production from
the Main Pass 41 field. Effective November 7, 2000, the Company assigned all of
its interest in the Main Pass 41 field to the field operator.

     Colombian oil prices averaged $27.18 per barrel during 2000. The average
price for the same period of 1999 was $15.57 per barrel. The Company's average
U.S. oil price increased to $28.94 per barrel in 2000, up from $17.13 per
barrel in 1999. In 2000 prices were higher than in 1999 due to an increase in
world oil prices. U.S. gas prices averaged $4.11 per MCF in 2000 compared to
$2.42 per MCF in 1999.

     Service fees of $387,000 for administering the Colombian assets were
received pursuant to a Service Agreement with Crosby (see note 2 of the
consolidated financial statements included elsewhere herein). This amount is
net of Aviva Overseas' 22.1196% share of the fee.

     Operating costs decreased approximately 33%, or $1,168,000, primarily as
a result of the transfer of partnership interests to Crosby.

     DD&A decreased by 49%, or $485,000, primarily as a result of the transfer
of partnership interests to Crosby and lower volumes of oil produced.

     G&A expenses declined $88,000 mainly as a result of lower public
ownership costs and lower fees paid to consultants, partially offset by higher
employee related costs.

                                      16

<PAGE>

     In connection with the Company's restructuring, the Company realized a
$3,452,000 gain on the transfer of partnership interests in Argosy Energy
International and a $5,543,000 extraordinary gain on the extinguishment of
debt, net of income taxes of $2,855,000.
     Interest and other income decreased $52,000 from 1999 primarily due to a
foreign exchange gain of $193,000 in 1999. During 2000, the foreign currency
exchange gain was only $44,000. The decrease in foreign exchange gain was
partially offset by higher miscellaneous income.

     Interest expense decreased $591,000 during 2000, primarily as a result of
the extinguishment of the Company's long-term debt.

New Accounting Pronouncements

     In July 2001 the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 141 "Business
Combinations" and SFAS No. 142 "Goodwill and Other Intangible Assets." SFAS No.
141 requires that all business combinations initiated after June 30, 2001 be
accounted for under the purchase method, and SFAS No. 142 requires that
goodwill no longer be amortized to earnings, but instead be reviewed for
impairment. As of December 31, 2001 there is no impact on the Company's
financial statements as we have not entered into any business combinations and
have not acquired goodwill.

     Also, the FASB issued SFAS No. 143 "Accounting for Asset Retirement
Obligations" which establishes requirements for the accounting of removal-type
costs associated with asset retirements. The standard is effective for fiscal
years beginning after June 15, 2002, with earlier application encouraged. The
Company is currently assessing the impact on its financial statements.

     On October 3, 2001, the FASB issued SFAS No. 144 "Accounting for the
Impairment or Disposal of Long-Lived Assets" which addresses financial
accounting and reporting for the impairment or disposal of long-lived assets.
SFAS No. 144 is effective for fiscal years beginning after December 15, 2001
and interim periods within those fiscal years with earlier application
encouraged. The Company is currently assessing the impact on its financial
statements.

Liquidity and Capital Resources

     Cash and cash equivalents totaled $1,010,000 and $820,000 at December 31,
2001 and 2000, respectively. The increase in cash and cash equivalents resulted
almost exclusively from net cash provided by operating activities.

     Net cash provided by operating activities was $190,000 in 2001, compared
to $1,722,000 for 2000. The decrease in net cash provided by operating
activities from 2000 to 2001 is primarily due to the sale of a major
partnership interest in Argosy during 2000 combined with lower oil prices.

     During the latter part of 2001, an offset operator drilled a successful
exploratory well approximately 4,000 feet from the eastern boundary of the
Company's Breton Sound acreage. Management of the Company is currently in
discussions with such operator, and other interested parties, with a view
towards negotiating an arrangement to explore the Company's Breton Sound
prospects. At this time it is not possible to predict the cost, if any, net to
the Company, that may arise should management successfully negotiate such an
arrangement.

     The Company is also engaged in ongoing operations in Colombia. The
obligations under the Santana contract have been met; however, Argosy plans to
recomplete certain existing wells and engage in various other projects. The
first of these recompletions is scheduled during 2003, and the majority of the
remaining recompletions are scheduled during 2004. The Company's share of the
estimated future costs of these activities is approximately $0.2 million at
December 31, 2001.

     The contract obligations of the Rio Magdalena contract require Argosy and
its co-owner to reprocess 40 kilometers of 2D seismic during the initial
18-month exploration phase of the contract. The Company's current share of the
estimated future costs of this phase is approximately $74,000 at December 31,
2001. Additional expenditures will be required should Argosy decide to enter
into the second phase of the contract.

     The proposed obligations of the Guayuyaco contract will require Argosy to
drill one exploratory well during the initial 12-month exploration phase of the
contract. Upon completion of the initial exploration phase, Argosy may

                                      17

<PAGE>

relinquish the contract or proceed to the following 18-month exploration phase,
whereunder Argosy will be obligated to drill a second exploratory well. Argosy
is continuing its efforts to secure an industry partner to farm-in to this
acreage and expects to drill the first exploratory well during the second
quarter of 2003.

     Failure by Argosy to meet the obligations under the proposed Guayuyaco
contract will result in the loss of the proposed contract terms. The existing
Santana production and acreage will not be affected. Failure by the Company to
fund its share of Argosy's obligations, assuming Argosy funds the obligation,
could result in a decrease in the Company's ownership interest in Argosy.

     The Company expects to fund its share of the cost of the recompletions on
the Santana contract and the seismic commitments on the Rio Magdalena contract
using existing cash and cash provided from operations. Risks that could
adversely affect funding of such activities include, among others, delays in
obtaining any required environmental permits, failure to produce the reserves
as projected or a decline in the sales price of oil. Any substantial increases
in the amounts of these required expenditures could adversely affect the
Company's ability to fund these activities. Any substantial delays could,
through the impact of inflation, increase the required expenditures. Cost
overruns resulting from factors other than inflation could also increase the
required expenditures. Historically, the inflation rate of the Colombian peso
has been in the range of 15-30% per year. Devaluation of the peso against the
U.S. dollar has historically been slightly less than the inflation rate in
Colombia. The Company has historically funded capital expenditures in Colombia
by converting U.S. dollars to pesos at such time as the expenditures have been
made. As a result of the interaction between peso inflation and devaluation of
the peso against the U.S. dollar, inflation, from the Company's perspective,
had not been a significant factor. During 1994, the first half of 1995 and
1996, however, devaluation of the peso was substantially lower than the rate of
inflation of the peso, resulting in an effective inflation rate in excess of
that of the U.S. dollar. There can be no assurance that this condition will not
occur again or that, in such event, there will not be substantial increases in
future capital expenditures as a result. Due to Colombian exchange controls and
restrictions and the lack of an effective market, it is not feasible to hedge
against the risk of net peso inflation against the U.S. dollar and the Company
has not done so. Depending on the results of future exploration and development
activities, substantial expenditures which have not been included in the
Company's cash flow projections may be required.

     Although the ultimate outcome of these matters cannot be projected with
certainty, management believes that the Company's existing capital resources
are adequate to fund its current obligations. If, however, the Company enters
into an arrangement to explore its Breton Sound acreage, the Company's existing
capital resources may be inadequate to fund the Company's share, if any, of the
exploration program. Accordingly, the Company may be required to raise
additional capital through equity issues, incurring debt or by sales of assets.
There can be no assurance that such attempts to raise additional capital would
be successful.

     With the exception of historical information, the matters discussed in
this annual report to shareholders contain forward-looking statements that
involve risks and uncertainties. Although the Company believes that its
expectations are based on reasonable assumptions, it can give no assurance that
its goals will be achieved. Important factors that could cause actual results
to differ materially from those in the forward-looking statements herein
include, among other things, general economic conditions, volatility of oil and
gas prices, the impact of possible geopolitical occurrences world-wide and in
Colombia, imprecision of reserve estimates, the assessment of geological and
geophysical data, changes in laws and regulations, unforeseen engineering and
mechanical or technological difficulties in drilling, working-over and
operating wells during the periods covered by the forward-looking statements,
as well as other factors described in "Item 1. Business - Risks Associated with
the Company's Business."

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

     The Company is exposed to market risk from changes in commodity prices.
The Company produces and sells crude oil and natural gas. These commodities are
sold based on market prices established with the buyers. The Company does not
use financial instruments to hedge commodity prices.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     See the Financial Statements of Aviva Petroleum Inc. attached hereto and
listed in Item 14 herein.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

     None.

                                      18

<PAGE>

                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Directors of the Company

     The by-laws of the Company provide that the number of directors may be
fixed by the Board of Directors at a number between one and seven, except that
a decrease in the number of directors shall not have the effect of reducing the
term of any incumbent director. Effective October 28, 1998, the Board of
Directors, by resolution, decreased the number of directors from five to three.
Effective April 6, 2000, Eugene C. Fiedorek resigned from the Board of
Directors decreasing the number of directors from three to two.

     The information set forth below, furnished to the Company by the
respective individuals, shows as to each individual his name, age and principal
positions with the Company.

          Name     Age            Positions                     Director Since
          ----     ---            ---------                     --------------

Ronald Suttill     70      President, Chief Executive Officer       1985
                           and Director

Robert J. Cresci   58      Director                                 1998

     The following sets forth the periods during which directors have served
as such and a brief account of the business experience of such persons during
at least the past five years.

     Ronald Suttill has been a director of the Company since August 1985 and
has been President and Chief Executive Officer of the Company since January
1992.

     Robert J. Cresci has been a director of the Company since October 1998.
Mr. Cresci has been a Managing Director of Pecks Management Partners Ltd., an
investment management firm, since September 1990. Mr. Cresci currently serves
on the boards of Sepracor, Inc., Film Roman, Inc., Castle Dental Centers, Inc.,
j2 Global Communications, Inc., Candlewood Hotel Co., Inc., SeraCare Life
Sciences, Inc., Learn2 Corporation and several private companies.

Executive Officers of the Company

     The following table lists the names and ages of each of the executive
officers of the Company and their principal occupations for the past five
years.

Name and Age                   Positions
------------                   ---------

Ronald Suttill, 70             President and Chief Executive Officer since
                               January 1992.

James L. Busby, 41             Chief Financial Officer since February 2000,
                               Treasurer since May 1994, Secretary since June
                               1996, Controller since November 1993.

Meetings and Committees of the Board of Directors

     The Board of Directors of the Company held one formal meeting during
2001. Each director attended at least 75% of the aggregate of (i) the total
number of meetings of the Board of Directors held during the period in which he
was a director and (ii) the total number of meetings held by all committees on
which he served.

     The Audit Committee and the Compensation Committee are the only standing
committees of the Board of Directors, and the members of such committees are
appointed at the initial meeting of the Board of Directors each year. The
Company does not have a formal nominating committee; the Board of Directors
performs this function.

     The Audit Committee, of which Mr. Cresci is the sole member, consults
with the independent accountants of the Company and such other persons as the
committee deems appropriate, reviews the preparations for and scope of the
audit of the Company's annual financial statements, makes recommendations as to
the engagement and fees of the independent accountants and performs such other
duties relating to the financial statements of the Company as the

                                       19

<PAGE>

Board of Directors may assign from time to time. The Audit Committee held no
formal meetings during 2001, however, business was conducted via telephone
conferences.

     The Compensation Committee, of which Mr. Cresci is the sole member, makes
recommendations to the Board of Directors regarding the compensation of
executive officers of the Company, including salary, bonuses, stock options and
other compensation. The Compensation Committee held no formal meetings during
2001.

Compliance with Section 16(a) of the Securities Exchange Act of 1934

     Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires officers, directors and holders of more than 10% of
the Common Stock (collectively, "Reporting Persons") to file reports of
ownership and changes in ownership of the Common Stock with the SEC within
certain time periods and to furnish the Company with copies of all such
reports. Based solely on its review of the copies of such reports furnished to
the Company by such Reporting Persons or on the written representations of such
Reporting Persons, the Company believes that, during the year ended December
31, 2001, all of the Reporting Persons complied with their Section 16(a) filing
requirements.

ITEM 11. EXECUTIVE COMPENSATION

Summary Compensation Table

     The following table sets forth certain information regarding compensation
earned in each of the last three fiscal years by the President and Chief
Executive Officer of the Company (the "Named Executive Officer").

<TABLE>
<CAPTION>
                                                         Summary Compensation Table
                                                         --------------------------
                                                                                  Long Term Compensation
                                                                           ---------------------------------------
                                 Annual Compensation                              Awards                   Payouts
                --------------------------------------------------------   ---------------------------------------
                                                                   Other
                                                                  Annual    Restricted     Securities
Name and                                                         Compen-         Stock     Underlying       LTIP     All Other
Principal                                Salary                   sation       Award(s)       Options/    Payouts    Compensa-
Position                    Year            ($)      Bonus ($)        ($)           ($)       SARs (#)         ($)    tion ($)
---------                ---------    ---------     ---------   ---------    ---------       ---------   ---------  ---------
<S>                        <C>         <C>               <C>            <C>         <C>             <C>         <C>      <C>

Ronald Suttill(1)
    President and CEO      2001         150,000              -          -           -               -           -        9,000
    President and CEO      2000         150,000          7,500          -           -               -           -        9,000
    President and CEO      1999         150,000              -          -           -               -           -        4,500
</TABLE>

(1)   The amount recorded under bonus represents the market value of 300,000
shares of the Company's common stock transferred to Mr. Suttill in connection
with the debt restructuring and transfer of partnership interests to Crosby,
effective June 8, 2000. The amounts reported for all other compensation for Mr.
Suttill represent matching contributions made under the Aviva Petroleum Inc.
401(k) Retirement Plan (the "401(k) Plan").

Directors' Fees

     The directors of the Company are not paid a cash fee. Directors are,
however, reimbursed for travel and lodging expenses. Mr. Suttill receives no
compensation as a director but is reimbursed for travel and lodging expenses
incurred to attend meetings.

     On July 1 each year, non-employee directors who have served in such
capacity for at least the entire proceeding calendar year each receive an
option to purchase 5,000 shares of the Company's Common Stock pursuant to the
Aviva Petroleum Inc. 1995 Stock Option Plan, as amended.

     Effective June 8, 2000, in connection with the debt restructuring and
transfer of partnership interests to Crosby, 200,000 shares of the Company's
common stock with a market value of $5,000 were transferred to Mr. Robert J.
Cresci.

Option Grants During 2001

     There were no options granted to the Named Executive Officer during 2001.
No stock appreciation rights have been issued by the Company.

Option Exercises During 2001 and Year End Option Values

                                      20

<PAGE>

     The following table provides information related to options exercised by
the Named Executive Officer during 2001 and the number and value of options
held at year-end. No stock appreciation rights have been issued by the Company.

<TABLE>
<CAPTION>
                                                 Number of Securities         Value of Unexercised
                                                 Underlying Unexercised       In-the-Money Options
                                                   Options at FY-End (#)         at FY-End ($) (1)
                Shares Acquired    Value       ----------------------------   --------------------------
Name            on Exercise (#)  Realized ($)    Exercisable  Unexercisable   Exercisable  Unexercisable
----            ---------------  ------------  -------------  -------------   -----------  -------------
<S>                       <C>            <C>         <C>                <C>          <C>             <C>
Ronald Suttill            none           none        250,000              -            -               -
</TABLE>

(1)  No values are ascribed to unexercised options of the Named Executive
Officer at December 31, 2001 because the fair market value of a share of the
Company's Common Stock at December 31, 2001 ($0.08) did not exceed the exercise
price of any such options.

Compensation Committee Interlocks and Insider Participation in Compensation
Decisions

     As indicated above, the Compensation Committee, none of the members of
which is an employee of the Company, makes recommendations to the Board of
Directors regarding the compensation of the executive officers of the Company,
including salary, bonuses, stock options and other compensation. There are no
Compensation Committee interlocks.

Employment Contracts

     The Named Executive Officer serves at the discretion of the Board of
Directors, except that, effective February 1, 2000, the Company entered into an
employment contract with Mr. Suttill. Mr. Suttill's contract provides for
annual compensation of not less than $200,000 and a severance amount of
$300,000 if his employment is terminated for any reason other than death,
disability or cause, as defined in the contract.

Compensation Committee Report on Executive Compensation

     The Company currently employs only two executive officers, the names of
whom are set forth above under "Item 10. Directors and Executive Officers of
the Registrant--Executive Officers of the Company." Decisions regarding
compensation of the executive officers are made by the Board of Directors,
after giving consideration to recommendations made by the Compensation
Committee.

     The Company's compensation policies are designed to provide a reasonably
competitive level of compensation within the industry in order to attract,
motivate, reward and retain experienced, qualified personnel with the talent
necessary to achieve the Company's performance objectives. These objectives are
to increase oil and gas reserves and to control costs, both objectives selected
to increase shareholder value. These policies were implemented originally by
the entire Board of Directors, and, following its establishment, were endorsed
by the Compensation Committee. It is the intention of the Compensation
Committee and the Board of Directors to balance compensation levels of the
Company's executive officers, including the Chief Executive Officer, with
shareholder interests. The incentive provided by stock options and bonuses, in
particular, is intended to promote congruency of interests between the
executive officers and the shareholders. Neither the Compensation Committee nor
the Board of Directors, however, believes that it is appropriate to rely on a
formulaic approach, such as profitability, revenue growth or return on equity,
in determining executive officer compensation because of the nature of the
Company's business. The Company's business objectives include obtaining funding
for and overseeing exploration and development activities in Colombia and
offshore in the United States. Success in one such area is not measurable by
the same factors as those used in the other. Accordingly, the Compensation
Committee and the Board of Directors rely primarily on their assessment of the
success of the executive officers, including the Chief Executive Officer, in
fulfilling the Company's performance objectives. The Board of Directors also
considers the fact that the Company competes with other oil and gas companies
for qualified executives and therefore it considers available information
regarding compensation levels for executives of companies similar in size to
the Company.

     Compensation for the Company's executive officers during 2001 was
comprised of salary and matching employer contributions made pursuant to the
Company's 401(k) Plan. The Company's 401(k) Plan is generally available to all
employees after one year of service. The Company makes matching contributions
of 100% of the amount deferred by the employee, up to 6% of an employee's
annual salary.

                                         Compensation Committee
                                         R. J. Cresci

                                      21

<PAGE>

Performance Graph

     The following line-graph presentation compares five-year cumulative
shareholder returns on an indexed basis with a broad equity market index and a
published industry index. The Company has selected the American Stock Exchange
Market Value Index as a broad equity market index, and the SIC Index "Crude
Petroleum and Natural Gas" as a published industry index.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN OF THE COMPANY, INDUSTRY INDEX AND
BROAD MARKET

<TABLE>
<CAPTION>
                                  ---------------------------FISCAL YEAR ENDING-------------------------
COMPANY/INDEX/MARKET              12/31/1996  12/31/1997  12/31/1998  12/31/1999  12/29/2000  12/31/2001

<S>                               <C>         <C>         <C>         <C>         <C>         <C>
AVIVA PETROLEUM INC.                  100.00       42.31        2.56        1.28        7.69       10.26

Crude Petroleum & Natural Gas         100.00      101.36       81.19       99.18      125.99      115.60

AMEX Market Index                     100.00      120.33      118.69      147.98      146.16      139.43
</TABLE>

                                      22

<PAGE>

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Security Ownership of Certain Beneficial Owners

     The following table sets forth certain information as to each person who,
to the knowledge of the Company, is the beneficial owner of more than five
percent of the outstanding Common Stock of the Company. Unless otherwise noted,
the information is furnished as of February 28, 2002.

<TABLE>
<CAPTION>
Name and Address of                     Amount and Nature of
Beneficial Owner or Group               Beneficial Ownership (1)         Percent of Class (2)
-------------------------               ------------------------         --------------------
<S>                                           <C>                                <C>
Ramat Securities Ltd.(3)                      10,632,470                         22.67%
Chagrin Plaza East
23811 Chagrin Blvd., Suite 200
Beachwood, Ohio 44122

Ronald Suttill(4) (5)                          3,073,273                          6.42%/(6)/
8235 Douglas Avenue, Suite 400
Dallas, Texas 75225

Lehman Brothers Inc.(7)                        2,966,876                          6.33%
745 Seventh Avenue
New York, New York 10019

Yale University(8)                             2,551,886                          5.44%
230 Prospect Street
New Haven, Connecticut 06511
</TABLE>

(1)      Except as set forth below, to the knowledge of the Company, each
beneficial owner has sole voting and sole investment power.

(2)     Based on 46,900,132 shares of the Common Stock issued and outstanding
on February 28, 2002.

(3)     Information regarding Ramat Securities Ltd. ("Ramat") is based on a
Schedule 13D/A filed on May 17, 2001, as a joint filing for Ramat, David
Zlatin, Howard Amster, Amster Trading Company Charitable Remainder Unitrusts
("Amster Unitrusts"), and Amster Trading Company. Ramat owns 6,577,370 shares
(14.02% of the outstanding) and has shared voting and dispositive power as to
those shares. Through his ownership in Ramat, David Zlatin beneficially owns an
aggregate of 6,577,370 shares and has shared voting and dispositive power over
those shares. The Amster Unitrusts own 4,055,100 shares (8.65% of the
outstanding) and have shared voting and dispositive power as to those shares.
Howard Amster is the trustee of the Amster Unitrusts. Howard Amster
beneficially owns an aggregate of 6,577,370 shares and has shared voting and
dispositive power as to 4,055,100 shares. The Amster Unitrusts have been funded
100% by Amster Trading Company. Howard Amster is the 100% owner of Amster
Trading Company. Because Amster Trading Company has the right to change the
trustee of the trusts, it can be deemed to have the right to shared voting and
dispositive power as to the 4,055,100 shares owned by the Amster Unitrusts.
Amster Trading Company disclaims beneficial ownership of the securities owned
by the Amster Unitrusts.

(4)     Included are options for 283,334 shares exercisable on or within
60 days of February 28, 2002.

(5)     Includes the entire ownership of AMG Limited, a limited liability
company of which Mr. Suttill is a member, as of February 28, 2002, of 935,550
shares of Common Stock.

(6)     Treated as outstanding for purposes of computing the percentage
ownership of Mr. Suttill are 981,500 shares issuable to all participants upon
exercise of vested stock options granted pursuant to the Company's stock option
plans.

(7)     Information regarding Lehman Brothers Inc. is based on information
received from Lehman Brothers Inc. on March 16, 1998.

(8)     Information regarding Yale University is based on a Schedule 13G
dated March 11, 1994 filed by Yale University with the SEC.

                                       23

<PAGE>

Security Ownership of Management

     The following table sets forth certain information as of February 28,
2002, concerning the Common Stock of the Company owned beneficially by each
director, by the Named Executive Officer listed in the Summary Compensation
Table above, and by directors and executive officers of the Company as a group:

<TABLE>
<CAPTION>
Name and Address of                   Amount and Nature
Beneficial Owner                      of Beneficial Ownership(1)     Percent of Class(2)
----------------                      ----------------------------  ---------------------
<S>                                      <C>                             <C>

Ronald Suttill                            3,073,273(3)(4)                  6.42%
8235 Douglas Avenue, Suite 400
Dallas, TX 75225

Robert J. Cresci                            232,500(5)                      *
Pecks Management Partners Ltd.
One Rockefeller Plaza
New York, NY 10020

All directors and executive officers
as a group (3 persons)                    4,595,192(6)                   9.60%
</TABLE>

(1)   Except as noted below, each beneficial owner has sole voting power and
      sole investment power.

(2)   Based on 46,900,132 shares of Common Stock issued and outstanding on
      February 28, 2002. Treated as outstanding for purposes of computing the
      percentage ownership of each director, the Named Executive Officer and
      all directors and executive officers as a group are 981,500 shares
      issuable upon exercise of vested stock options granted pursuant to the
      Company's stock option plans.
(3)   Included are options for 283,334 shares exercisable on or within 60
      days of February 28, 2002.
(4)   Includes the entire ownership of AMG Limited, a limited liability
      company of which Mr. Suttill is a member, as of February 28, 2002, of
      935,550 shares of Common Stock.
(5)   Included are options for 32,500 shares exercisable on or within 60 days
      of February 28, 2002.
(6)   Included are 935,550 shares beneficially owned through
      AMG Limited and options for 492,500 shares exercisable on or within 60
      days of February 28, 2002.
*     Less than 1% of the outstanding Aviva Common Stock.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

None.

                                      24

<PAGE>

                                    PART IV
ITEM    14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

a.      The following documents are filed as part of this report:
        (1)     Financial Statements: The Financial Statements of Aviva
                Petroleum Inc. filed as part of this report are listed in the
                "Index to Financial Statements" included elsewhere herein.

        (2)     Financial Statement Schedules: All schedules called for under
                Regulation S-X have been omitted because they are not
                applicable, the required information is not material or the
                required information is included in the consolidated financial
                statements or notes thereto.

        (3)     Exhibits:

                *2.1    Loan, Settlement and Acquisition Agreement dated
                        effective May 31, 2000, by and among Crosby Capital,
                        LLC, Aviva Petroleum Inc., Aviva America, Inc., Aviva
                        Operating Company, Aviva Overseas, Inc., Neo Energy,
                        Inc., Garnet Resources Corporation, Argosy Energy,
                        Inc., and Argosy Energy International (filed as exhibit
                        2.1 to the Company's Form 8-K dated June 8, 2000, File
                        No. 0-22258, and incorporated herein by reference).

                *2.2    Confirmed Plan of Reorganization of Aviva America,
                        Inc. (filed as exhibit 2.4 to the Company's annual
                        report on Form 10-K for the year ended December 31,
                        2000, File No. 0-22258, and incorporated by
                        reference).

                *3.1    Restated Articles of Incorporation of the
                        Company dated July 25, 1995 (filed as exhibit 3.1
                        to the Company's annual report on Form 10-K for the
                        year ended December 31, 1995, File No. 0-22258, and
                        incorporated herein by reference).

                *3.2    Amended and Restated Bylaws of the Company, as
                        amended as of January 23, 1995 (filed as exhibit
                        3.2 to the Company's annual report on Form 10-K for
                        the year ended December 31, 1994, File No. 0-22258,
                        and incorporated herein by reference).

                *10.1   Risk Sharing Contract between Empresa Colombiana de
                        Petroleos ("Ecopetrol"), Argosy Energy
                        International ("Argosy") and Neo Energy, Inc.
                        ("Neo") (filed as exhibit 10.1 to the Company's
                        Registration Statement on Form10, File No. 0-22258,
                        and incorporated herein by reference).

                 *10.2  Contract for Exploration and Exploitation of Sector
                        Number 1 of the Aporte Putumayo Area ("Putumayo")
                        between Ecopetrol and Cayman Corporation of
                        Colombia dated July 24, 1972 (filed as exhibit 10.2
                        to the Company's Registration Statement on Form10,
                        File No. 0-22258, and incorporated herein by
                        reference).

                *10.3   Operating Agreement for Putumayo between Argosy and
                        Neo dated September 16, 1987 and amended on January
                        4, 1989 and February 23, 1990 (filed as exhibit
                        10.3 to the Company's Registration Statement on
                        Form10, File No. 0-22258, and incorporated herein
                        by reference).

                *10.4   Operating Agreement for the Santana Area
                        ("Santana") between Argosy and Neo dated September
                        16, 1987 and amended on January 4, 1989, February
                        23, 1990 and September 28, 1992 (filed as exhibit
                        10.4 to the Company's Registration Statement on
                        Form10, File No. 0-22258, and incorporated herein
                        by reference).

                 *10.5  Santana Block A Relinquishment dated March 6, 1990
                        between Ecopetrol, Argosy and Neo (filed as exhibit
                        10.8 to the Company's Registration Statement on
                        Form10, File No. 0-22258, and incorporated herein
                        by reference).

                 *10.6  Employee Stock Option Plan of the Company (filed as
                        exhibit 10.13 to the Company's Registration
                        Statement on Form10, File No. 0-22258, and
                        incorporated herein by reference).

                 *10.7  Santana Block B 50% relinquishment dated September
                        13, 1993 between Ecopetrol, Argosy and Neo (filed
                        as exhibit 10.26 to the Company's annual report on
                        Form 10-K for the year ended December 31, 1993,
                        File No. 0-22258, and incorporated herein by
                        reference).

                 *10.8  Aviva Petroleum Inc. 401(k) Retirement Plan
                        effective March 1, 1992 (filed as exhibit 10.29 to
                        the Company's annual report on Form 10-K for the
                        year ended December 31, 1993, File No. 0-22258, and
                        incorporated herein by reference).

                *10.9   Relinquishment of Putumayo dated December 1, 1993
                        (filed as exhibit 10.30 to the Company's annual
                        report on Form 10-K for the year ended December 31,
                        1993, File No. 0-22258, and incorporated herein by
                        reference).

                                       25

<PAGE>

                *10.10  Deposit Agreement dated September 15, 1994 between
                        the Company and Chemical Shareholder Services
                        Group, Inc. (filed as exhibit 10.29 to the
                        Company's Registration Statement on Form S-1, File
                        No. 33-82072, and incorporated herein by reference).

                *10.11  Letter from Ecopetrol dated December 28, 1994,
                        accepting relinquishment of Putumayo (filed as
                        exhibit 10.38 to the Company's annual report on
                        Form 10-K for the year ended December 31, 1994,
                        File No. 0-22258, and incorporated herein by
                        reference).

                *10.12  Amendment to the Incentive and Nonstatutory Stock
                        Option Plan of the Company (filed as exhibit 10.4
                        to the Company's quarterly report on Form 10-Q for
                        the quarter ended September 30, 1995, File No.
                        0-22258, and incorporated herein by reference).

                *10.13   Santana Block B 25% relinquishment dated October 2,
                        1995 (filed as exhibit 10.51 to the Company's
                        annual report on Form 10-K for the year ended
                        December 31, 1995, File No. 0-22258, and
                        incorporated herein by reference).

                *10.14  Aviva Petroleum Inc. 1995 Stock Option Plan, as
                        amended (filed as Appendix A to the Company's
                        definitive Proxy Statement for the Annual Meeting
                        of Shareholders dated June 10, 1997, and
                        incorporated herein by reference).

                *10.15  Restated Credit Agreement dated as of October 28,
                        1998, between Neo Energy, Inc., Aviva Petroleum
                        Inc. and ING (U.S.) Capital Corporation (filed as
                        exhibit 99.1 to the Company's Form 8-K dated
                        October 28, 1998, File No. 0-22258, and
                        incorporated herein by reference).

                *10.16  Joint Finance and Intercreditor Agreement dated as
                        of October 28, 1998, between Neo Energy, Inc.,
                        Aviva Petroleum Inc., ING (U.S.) Capital
                        Corporation, Aviva America, Inc., Aviva Operating
                        Company, Aviva Delaware Inc., Garnet Resources
                        Corporation, Argosy Energy Incorporated, Argosy
                        Energy International, Garnet PNG Corporation, the
                        Overseas Private Investment Corporation, Chase Bank
                        of Texas, N.A. and ING (U.S.) Capital Corporation
                        as collateral agent for the creditors (filed as
                        exhibit 99.2 to the Company's Form 8-K dated
                        October 28, 1998, File No. 0-22258, and
                        incorporated herein by reference).

                *10.17  Amended and Restated Aviva Petroleum Inc. Severance
                        Benefit Plan dated December 31, 1999 (filed as
                        exhibit 10.18 to the Company's annual report on
                        Form 10-K for the year ended December 31, 1999,
                        File No. 0-22258, and incorporated herein by
                        reference).

                *10.18  Santana Crude Sale and Purchase Agreement dated
                        January 3, 2000 (filed as exhibit 10.19 to the
                        Company's annual report on Form 10-K for the year
                        ended December 31, 1999, File No. 0-22258, and
                        incorporated herein by reference).

                *10.19  Employment Agreement between the Company and Ronald
                        Suttill dated February 1, 2000 (filed as exhibit
                        10.20 to the Company's annual report on Form 10-K
                        for the year ended December 31, 1999, File No.
                        0-22258, and incorporated herein by reference).

                *10.20  Employment Agreement between the Company and James
                        L. Busby dated February 1, 2000 (filed as exhibit
                        10.21 to the Company's annual report on Form 10-K
                        for the year ended December 31, 1999, File No.
                        0-22258, and incorporated herein by reference).

                *10.21  Service Agreement between Argosy Energy
                        International and Aviva Overseas, Inc. dated as of
                        June 1, 2000 (filed as exhibit 10.1 to the
                        Company's quarterly report on Form 10-Q for the
                        quarter ended June 30, 2000, File No. 0-22258, and
                        incorporated herein by reference).

                *10.22  Letter Agreement dated June 8, 2000 between Crosby
                        Capital, LLC and Aviva America, Inc. (filed as
                        exhibit 10.2 to the Company's quarterly report on
                        Form 10-Q for the quarter ended June 30, 2000, File
                        No. 0-22258, and incorporated herein by reference).

                *10.23  Guaranty dated May 31, 2000 made by Aviva Overseas,
                        Inc. in favor of Crosby Capital, LLC (filed as
                        exhibit 10.3 to the Company's quarterly report on
                        Form 10-Q for the quarter ended June 30, 2000, File
                        No. 0-22258, and incorporated herein by reference).

                *10.24  Assignment and Assumption Agreement dated June 1,
                        2000, between Crosby Capital, LLC and Neo Energy,
                        Inc. (filed as exhibit 10.4 to the Company's
                        quarterly report on Form 10-Q for the quarter ended
                        June 30, 2000, File No. 0-22258, and incorporated
                        herein by reference).

                *10.25  Assignment and Assumption Agreement dated June 1, 2000
                        between Crosby Acquisition LLC and Argosy Energy, Inc.
                        (filed as exhibit 10.5 to the Company's quarterly
                        report on Form 10-Q for the quarter ended June 30,
                        2000, File No. 0-22258, and incorporated herein by
                        reference).

                *10.26  Assignment and Assumption Agreement dated June 1,
                        2000 between Crosby Capital, LLC and Garnet
                        Resources Corp. (filed as exhibit 10.6 to the
                        Company's quarterly report on Form 10-Q for the
                        quarter ended June 30, 2000, File No. 0-22258, and
                        incorporated herein by reference).

                                      26

<PAGE>

                *10.27  Assignment and Assumption Agreement dated June 1,
                        2000 between Crosby Capital, LLC and Aviva
                        Overseas, Inc. (filed as exhibit 10.7 to the
                        Company's quarterly report on Form 10-Q for the
                        quarter ended June 30, 2000, File No. 0-22258, and
                        incorporated herein by reference).

                *10.28  Assignment and Assumption Agreement dated June 1,
                        2000 between Argosy Energy, Incorporated and Crosby
                        Acquisition, LLC (filed as exhibit 10.8 to the
                        Company's quarterly report on Form 10-Q for the
                        quarter ended June 30, 2000, File No. 0-22258, and
                        incorporated herein by reference).

                *10.29  Assignment and Assumption Agreement dated June 1,
                        2000 between Crosby Capital, LLC and Aviva
                        Overseas, Inc. (filed as exhibit 10.9 to the
                        Company's quarterly report on Form 10-Q for the
                        quarter ended June 30, 2000, File No. 0-22258, and
                        incorporated herein by reference).

                *10.30  Pledge Agreement dated May 31, 2000 executed by
                        Aviva Overseas, Inc. (Debtor) in favor of Crosby
                        Capital, LLC (Secured Party) (filed as exhibit
                        10.10 to the Company's quarterly report on Form
                        10-Q for the quarter ended June 30, 2000, File No.
                        0-22258, and incorporated herein by reference).

                *10.31  Third Amendment to Second Amended and Restated
                        Limited Partnership Agreement of Argosy Energy
                        International dated May 31, 2000 (filed as exhibit
                        10.11 to the Company's quarterly report on Form
                        10-Q for the quarter ended June 30, 2000, File No.
                        0-22258, and incorporated herein by reference).

                *10.32   Fourth Amendment to Second Amended and Restated
                        Limited Partnership Agreement of Argosy Energy
                        International dated June 1, 2000 (filed as exhibit
                        10.12 to the Company's quarterly report on Form
                        10-Q for the quarter ended June 30, 2000, File No.
                        0-22258, and incorporated herein by reference).

                *10.33  Assignment of Stock Warrant Rights dated May 31,
                        2000 executed by Crosby Capital, LLC in favor of
                        Aviva Petroleum Inc. (filed as exhibit 10.13 to the
                        Company's quarterly report on Form 10-Q for the
                        quarter ended June 30, 2000, File No. 0-22258, and
                        incorporated herein by reference).

                *10.34  Assignment of Neo Debt and Collateral, dated
                        December 21, 2000 from Crosby Capital, LLC to Aviva
                        Operating Company (filed as exhibit 10.34 to the
                        Company's annual report on Form 10-K for the year
                        ended December 31, 2000, File No. 0-22258, and
                        incorporated herein by reference).

                *10.35  Conveyance of Net Profits Interest, dated December
                        21, 2000 from Aviva America, Inc. to Crosby
                        Capital, LLC (filed as exhibit 10.35 to the
                        Company's annual report on Form 10-K for the year
                        ended December 31, 2000, File No. 0-22258, and
                        incorporated herein by reference).
                *10.36  Santana Crude Sale and Purchase Agreement dated January
                        3,2001 (filed as exhibit 10.1 to the Company's
                        quarterly report on Form 10-Q for the quarter ended
                        June 30, 2001, File No. 0-22258, and incorporated
                        herein by reference).

               **10.37  Santana Crude Sale and Purchase Agreement dated
                        January 30, 2002.

               **10.38  Rio Magdalena Association Contract dated December
                        10, 2001 between Ecopetrol and Argosy.

                *21.1   List of subsidiaries of Aviva Petroleum Inc. (filed
                        as exhibit 21.1 to the Company's annual report on
                        Form 10-K for the year ended December 31, 2000,
                        File No. 0-22258, and incorporated herein by
                        reference).

                ------------------------------------------
                *       Previously Filed
                **      Filed Herewith

b.      Reports on Form 8-K
        -------------------
        The Company did not file any Current Reports on Form 8-K during and
        subsequent to the end of the fourth quarter.

                                       27

<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.

                                           AVIVA PETROLEUM INC.

                                     By:   /s/ Ronald Suttill
                                           -----------------------------------
                                           Ronald Suttill
                                           Chief Executive Officer and Director

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 dates indicated.

Signature                             Title                        Date

/s/ Ronald Suttill       President, Chief Executive Officer   March 22, 2002
-----------------------                                       --------------
Ronald Suttill           and Director (principal executive
                         officer)

/s/ James L. Busby       Secretary, Treasurer and              March 22, 2002
-----------------------                                       ---------------
James L. Busby           Chief Financial Officer
                         (principal financial and accounting
                         officer)

/s/ Robert J. Cresci     Director                              March 22, 2002
-----------------------                                       ---------------
Robert J. Cresci

                                       28

<PAGE>

        INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES

                                                                           Page
                                                                         ------

Independent Auditors' Report.............................................    30

Consolidated Balance Sheet as of December 31, 2001 and 2000..............    31

Consolidated Statement of Operations for the years
     ended December 31, 2001, 2000 and 1999..............................    32

Consolidated Statement of Cash Flows for the years
     ended December 31, 2001, 2000 and 1999..............................    33

Consolidated Statement of Stockholders' Equity (Deficit) for the years
     ended December 31, 2001, 2000 and 1999..............................    34

Notes to Consolidated Financial Statements...............................    35

Supplementary Information Related to Oil and Gas Producing
     Activities (Unaudited)..............................................    46

All schedules called for under Regulation S-X have been omitted because they
are not applicable, the required information is not material or the required
information is included in the consolidated financial statements or notes
thereto.

                                       29

<PAGE>

                          INDEPENDENT AUDITORS' REPORT
                          ----------------------------

The Board of Directors
Aviva Petroleum Inc.:

We have audited the accompanying consolidated financial statements of Aviva
Petroleum Inc. and subsidiaries as listed in the accompanying index. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. 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 financial position of Aviva Petroleum
Inc. and subsidiaries as of December 31, 2001 and 2000, and the results of
their operations and their cash flows for each of the years in the three-year
period ended December 31, 2001, in conformity with accounting principles
generally accepted in the United States of America.

                                            /s/   KPMG LLP
                                            ----------------------------

Dallas, Texas
March 1, 2002

                                       30

<PAGE>

                     AVIVA PETROLEUM INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEET
                          DECEMBER 31, 2001 AND 2000
                   (in thousands, except number of shares)

<TABLE>
<CAPTION>
                                                                         2001             2000
                                                                   ----------       ----------
<S>                                                                <C>              <C>
ASSETS

Current assets:
   Cash and cash equivalents                                       $    1,010       $      820
   Accounts receivable (note 7):
      Oil and gas revenue                                                  42              132
      Trade                                                                66               65
      Other                                                                79               40
   Inventories                                                            209              161
   Prepaid expenses and other                                             140              187
                                                                   ----------       ----------

      Total current assets                                              1,546            1,405
                                                                   ----------       ----------

Property and equipment, at cost:
   Oil and gas properties and equipment (full cost method)             20,244           16,414
   Other                                                                  334              333
                                                                   ----------       ----------
                                                                       20,578           16,747
   Less accumulated depreciation, depletion
      and amortization                                                (19,981)         (15,791)
                                                                   ----------       ----------
                                                                          597              956
Other assets (note 3)                                                     991              950
                                                                   ----------       ----------

                                                                   $    3,134       $    3,311
                                                                   ==========       ==========

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
   Accounts payable                                                $      776       $      945
   Accrued liabilities                                                     37              115
                                                                   ----------       ----------
      Total current liabilities                                           813            1,060
                                                                   ----------       ----------

Other liabilities                                                         368              375

Stockholders' equity (notes 2 and 5):
   Common stock, no par value, authorized 348,500,000 shares;
      issued 46,900,132 shares                                          2,345            2,345
   Additional paid-in capital                                          37,710           37,710
   Accumulated deficit*                                               (38,102)         (38,179)
                                                                   ----------       ----------

      Total stockholders' equity                                        1,953            1,876

Commitments and contingencies (note 8)
                                                                   ----------       ----------

                                                                   $    3,134       $    3,311
                                                                   ==========       ==========
</TABLE>

*Accumulated deficit of $70,057 was eliminated at December 31, 1992 in
connection with a quasi-reorganization.
See note 5.

See accompanying notes to consolidated financial statements.

                                       31

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF OPERATIONS
                  YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999
                      (in thousands, except per share data)

<TABLE>
<CAPTION>
                                                                   2001               2000               1999
                                                             ----------         ----------         ----------
<S>                                                          <C>                <C>                <C>
Revenue:
   Oil and gas sales (note 7)                                $    2,136         $    5,796         $    6,797
   Service fees (note 2)                                            473                387                  -
                                                             ----------         ----------         ----------
      Total revenue                                               2,609              6,183              6,797
                                                             ----------         ----------         ----------

Expense:
   Production                                                     1,402              2,407              3,575
   Depreciation, depletion and amortization                         320                515              1,000
   General and administrative                                     1,006              1,157              1,245
   Recovery of losses on accounts receivable                        (48)              (256)              (101)
   Severance                                                          -                  -                 62
                                                             ----------         ----------         ----------

      Total expense                                               2,680              3,823              5,781
                                                             ----------         ----------         ----------

Other income (expense):
   Gain on transfer of partnership interests (note 2)                 -              3,452                  -
   Interest and other income (expense), net (note 4)                235                207                259
   Interest expense                                                  (3)              (805)            (1,396)
                                                             ----------         ----------         ----------

      Total other income (expense)                                  232              2,854             (1,137)
                                                             ----------         ----------         ----------

      Earnings (loss) before income taxes and
         extraordinary item                                         161              5,214               (121)

Income taxes (note 6)                                               (84)              (253)              (282)
                                                             ----------         ----------         ----------

      Earnings (loss) before extraordinary item                      77              4,961               (403)

Extraordinary item - debt extinguishment, net of
   income taxes of $2,855 (notes 2 and 9)                             -              5,543                  -
                                                             ----------         ----------         ----------

      Net earnings (loss)                                    $       77         $   10,504         $     (403)
                                                             ==========         ==========         ==========

Weighted average common shares outstanding -
   basic and diluted                                             46,900             46,900             46,813
                                                             ==========         ==========         ==========

Basic and diluted net earnings (loss) per common share:
   Before extraordinary item                                 $     0.00         $     0.10         $    (0.01)
   Extraordinary item                                                 -               0.12                  -
                                                             ----------         ----------         ----------
   Net earnings (loss)                                       $     0.00         $     0.22         $    (0.01)
                                                             ==========         ==========         ==========
</TABLE>

See accompanying notes to consolidated financial statements.

                                       32

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                  YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999
                                 (in thousands)

<TABLE>
<CAPTION>

                                                                  2001      2000      1999
                                                              --------  --------  --------
<S>                                                           <C>       <C>       <C>
Net earnings (loss)                                           $     77  $ 10,504  $   (403)
Adjustments to reconcile net earnings (loss) to
 net cash provided by (used in) operating activities:
  Depreciation, depletion and amortization                         320       515     1,000
  Recovery of losses on accounts receivable                        (48)     (256)     (101)
  Gain on transfer of partnership interests                          -    (3,452)        -
  Gain on debt extinguishment                                        -    (5,543)        -
  Loss (gain) on sale of assets, net                                (4)        4       (11)
  Foreign currency exchange gain, net                              (11)      (44)     (193)
  Other                                                           (127)     (357)      247
  Changes in assets and liabilities, net of effects
   of transfer of partnership interests:
     Escrow account                                                  -         4       413
     Accounts receivable                                           155       204       120
     Inventories                                                     8        10       112
     Prepaid expenses and other                                     51        27        38
     Accounts payable and accrued liabilities                     (231)      106    (1,703)
                                                              --------  --------  --------

       Net cash provided by (used in) operating
          activities                                               190     1,722      (481)
                                                              --------  --------  --------

Cash flows from investing activities:
   Costs of and cash balances acquired (surrendered) in
     connection with the transfer of partnership
     interests from (to) Crosby                                     41    (1,414)        -
  Property and equipment expenditures                             (135)     (382)     (285)
  Proceeds from sale of assets                                       4         -        37
  Other                                                             80         -         -
                                                              --------  --------  --------

       Net cash used in investing
          activities                                               (10)   (1,796)     (248)
                                                              --------  --------  --------

Cash flows from financing activities-
  Principal payments on long term debt                               -         -      (300)
                                                              --------  --------  --------

Effect of exchange rate changes on cash and
  cash equivalents                                                  10        48       163
                                                              --------  --------  --------

Net increase (decrease) in cash and cash equivalents               190       (26)     (866)
Cash and cash equivalents at beginning of year                     820       846     1,712
                                                              --------  --------  --------

Cash and cash equivalents at end of year                      $  1,010  $    820  $    846
                                                              ========  ========  ========

</TABLE>

See accompanying notes to consolidated financial statements.

                                      33

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
            CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
                  YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999
                    (in thousands, except number of shares)

<TABLE>
<CAPTION>

                                  Common Stock
                                -------------------  Additional                     Total
                                Number of              Paid-in   Accumulated   Stockholders'
                                   Shares    Amount    Capital       Deficit   Equity (Deficit)
                                ---------   -------  ---------    -----------  ----------------

<S>                            <C>         <C>       <C>          <C>          <C>
Balances at
  December 31, 1998            46,700,132  $  2,335  $  34,862    $  (48,280)  $  (11,083)

Issuance of common stock
  pursuant to investment
  banking agreement               200,000        10         (7)            -            3

Net loss                                -         -          -          (403)        (403)
                               ----------  --------  ---------    ----------  -----------

Balances at
  December 31, 1999            46,900,132     2,345     34,855       (48,683)     (11,483)

Tax benefits relating
  to January 1, 1993
  valuation allowance (note 6)          -         -      2,855             -        2,855

Net earnings                            -         -          -        10,504       10,504
                               ----------  --------  ---------    ----------  -----------

Balances at
  December 31, 2000            46,900,132     2,345     37,710       (38,179)       1,876

Net earnings                            -         -          -            77           77
                               ----------  --------  ---------    ----------  -----------

Balances at
  December 31, 2001            46,900,132  $  2,345  $  37,710    $  (38,102)  $    1,953
                               ==========  ========  =========    ===========  ==========
</TABLE>

See accompanying notes to consolidated financial statements.

                                      34

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     General
     Aviva Petroleum Inc. and its subsidiaries (the "Company") are engaged in
     the business of exploring for, developing and producing oil and gas in
     Colombia and in the United States. The Company's Colombian oil production
     is sold to Empresa Colombiana de Petroleos, the Colombian national oil
     company ("Ecopetrol"), while the Company's U.S. oil and gas production is
     sold to principally one U.S. purchaser (See notes 7 and 10).

     Oil and gas are the Company's only products, and there is substantial
     uncertainty as to the prices that the Company may receive for its
     production. A decrease in these prices would affect operating results
     adversely.

     Principles of Consolidation
     The consolidated financial statements include the accounts of Aviva
     Petroleum Inc. and its subsidiaries. The Company proportionately
     consolidates less than 100% owned oil and gas partnerships in accordance
     with industry practice. All significant intercompany accounts and
     transactions have been eliminated in consolidation.

     Inventories
     Inventories consist primarily of tubular goods, oilfield equipment and
     spares and are stated at the lower of average cost or market.

     Property and Equipment
     Under the full cost method of accounting for oil and gas properties, all
     productive and nonproductive property acquisition, exploration and
     development costs are capitalized in separate cost centers for each
     country. Such capitalized costs include lease acquisition costs, delay
     rentals, geophysical, geological and other costs, drilling, completion
     and other related costs and direct general and administrative expenses
     associated with property acquisition, exploration and development
     activities. Capitalized general and administrative costs include internal
     costs such as salaries and related benefits paid to employees to the
     extent that they are directly engaged in such activities, as well as all
     other directly identifiable general and administrative costs associated
     with such activities, including rent, utilities and insurance and do not
     include any costs related to production, general corporate overhead, or
     similar activities. Capitalized internal general and administrative costs
     were $66,000 in 2001, $57,000 in 2000 and $46,000 in 1999.

     Evaluated capitalized costs of oil and gas properties and the estimated
     future development, site restoration, dismantlement and abandonment costs
     are amortized by cost center, using the units-of-production method. Total
     net future site restoration, dismantlement and abandonment costs are
     estimated to be $799,000.

     Depreciation, depletion and amortization expense per equivalent barrel of
     production was as follows:

                         2001          2000        1999
                      --------     --------    --------
United States         $  5.24      $   2.62    $   1.10
Colombia              $  1.66      $   2.29    $   2.40

     In accordance with the full cost method of accounting, the net
     capitalized costs of oil and gas properties less related deferred income
     taxes for each cost center are limited to the sum of the estimated future
     net revenues from the properties at current prices less estimated future
     expenditures, discounted at 10%, and unevaluated costs not being
     amortized, less income tax effects related to differences between the
     financial and tax bases of the properties, computed on a quarterly basis.
     An excess of the capitalized costs relating to the U.S. cost center over
     the limitation at December 31, 2001 was not charged against earnings
     because of a price increase subsequent to year-end.

     Depletion expense and limits on capitalized costs are based on estimates
     of oil and gas reserves which are inherently imprecise and assume current
     prices for future net revenues. Accordingly, it is reasonably possible
     that the estimates of reserves quantities and future net revenues could
     differ materially in the near term from

                                      35

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     amounts currently estimated. Moreover, a future decrease in the prices
     the Company receives for its oil and gas production or downward reserve
     adjustments could result in a ceiling test write-down that is significant
     to the Company's operating results.

     Gains and losses on sales of oil and gas properties are not recognized in
     income unless the sale involves a significant portion of the reserves
     associated with a particular cost center. Capitalized costs associated
     with unevaluated properties are excluded from amortization until it is
     determined whether proved reserves can be assigned to such properties or
     until the value of the properties is impaired. Unevaluated costs of
     $303,000 and $272,000 were excluded from amortization at December 31,
     2001 and 2000, respectively. Unevaluated properties are assessed
     quarterly to determine whether any impairment has occurred. The
     unevaluated costs at December 31, 2001 represent exploration costs and
     were incurred primarily during the five-year period ended December 31,
     2001. Such costs are expected to be evaluated and included in the
     amortization computation within the next three years.

     Other property and equipment is depreciated using the straight-line
     method over the estimated useful lives of the assets.

     Gas Balancing
     The Company uses the entitlements method of accounting for gas sales. Gas
     production taken by the Company in excess of amounts entitled is recorded
     as a liability to the other joint owners. Excess gas production taken by
     others is recognized as income to the extent of the Company's
     proportionate share of the gas sold and a related receivable is recorded
     from the other joint owners.

     Interest Expense
     The Company capitalizes interest costs on qualifying assets, principally
     unevaluated oil and gas properties. During 2000 and 1999, the Company
     capitalized $43,000 and $59,000 of interest, respectively.

     Earnings Per Common Share
     Basic earnings per share ("EPS") is computed by dividing income available
     to common shareholders by the weighted-average number of common shares
     outstanding for the period. Diluted EPS reflects the potential dilution
     that could occur if securities or other contracts to issue common stock
     were exercised or converted into common stock or resulted in the issuance
     of common stock that then shared in the earnings of the entity. For the
     years presented herein, basic and diluted EPS are the same since the
     effects of potential common shares (note 5) are either antidilutive or
     insignificant. For fiscal year 2001, options for 599,000 common shares
     were not included in the computation of diluted earnings per share,
     because their exercise price approximated the average market price of the
     common shares and the effect would be insignificant. For fiscal year
     2000, options for 1,024,000 common shares were not included in the
     computation of diluted earnings per share because their exercise price
     was greater than the average market price of the common shares and,
     therefore, the effect would be antidilutive.

     Income Taxes
     The Company accounts for income taxes in accordance with Statement of
     Financial Accounting Standards No. 109 ("Statement 109") which requires
     recognition of deferred tax assets in certain circumstances and deferred
     tax liabilities for the future tax consequences of temporary differences
     between the financial statement carrying amounts and the tax bases of
     assets and liabilities.

     Statement of Cash Flows
     The Company considers all highly liquid debt instruments with original
     maturities of three months or less to be cash equivalents. The Company
     paid interest, net of amounts capitalized, of $3,000 in 2001, $(37,000)
     in 2000 and $547,000 in 1999 and paid income taxes of $107,000 in 2001,
     $267,000 in 2000 and $201,000 in 1999.

     Fair Value of Financial Instruments

     The reported values of cash, cash equivalents, accounts receivable and
     accounts payable approximate fair value due to their short maturities.

                                      36

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     Foreign Currency Translation
     The accounts of the Company's foreign operations are translated into
     United States dollars in accordance with Statement of Financial
     Accounting Standards No. 52. The United States dollar is used as the
     functional currency. Exchange adjustments resulting from foreign currency
     transactions are recognized in expense or income in the current period.

     Use of Estimates
     The preparation of financial statements in conformity with generally
     accepted accounting principles requires management to make estimates and
     assumptions that affect the reported amounts of assets and liabilities
     and disclosure of contingent assets and liabilities at the date of the
     financial statements and the reported amounts of revenues and expenses
     during the reporting period. Actual results could differ from those
     estimates.

     Comprehensive Income
     Comprehensive income includes net income and other comprehensive income
     which is generally comprised of changes in the fair value of
     available-for-sale marketable securities, foreign currency translation
     adjustments and adjustments to recognize additional minimum pension
     liabilities. For each period presented in the accompanying consolidated
     statement of operations, comprehensive income and net income are the same
     amount.

(2)  DEBT RESTRUCTURING AND TRANSFER OF PARTNERSHIP INTERESTS

     On June 8, 2000, the Company entered into agreements with the Company's
     senior secured lender, Crosby Capital, LLC ("Crosby"), in order to
     restructure the Company's senior debt which, including unpaid interest,
     aggregated $16,103,064 as of May 31, 2000. Crosby acquired the debt from
     ING Capital and OPIC on May 1, 2000. Pursuant to the agreements, Crosby
     canceled $13,353,064 of such debt and transferred to the Company warrants
     for 1,500,000 shares of the Company's common stock in exchange for the
     general partner rights and an initial 77.5% partnership interest in
     Argosy Energy International ("Argosy"), a Utah limited partnership, which
     holds the Company's Colombian properties. Following the transaction,
     Aviva Overseas Inc. ("Aviva Overseas"), a wholly owned subsidiary of the
     Company, owns a 22.1196% limited partnership interest in Argosy. An
     additional 7.5% limited partnership interest was transferred from Crosby
     to Aviva Overseas when Crosby had received in distributions from Argosy
     an amount equal to $3,500,000 plus interest at the prime rate plus 1% on
     the outstanding balance thereof.

     The Company's remaining debt of $2,750,000 was reacquired from Crosby on
     December 21, 2000, in exchange for a 15% net profits interest in any new
     production at Breton Sound Block 31 field. This transaction substantially
     completed the restructuring of the Company and the reorganization of the
     Company's wholly owned subsidiary Aviva America, Inc. ("AAI")
     (see note 9).

     In order to assist Crosby in maximizing the value of its interest in
     Argosy, Crosby entered into a Service Agreement with Aviva Overseas
     pursuant to which Aviva Overseas would provide certain services in
     administering the Colombian assets in exchange for a monthly fee. The fee
     was $71,000 per month for the period June 1, 2000 through March 31, 2001,
     $46,000 per month for the period April 1, 2001 through March 31, 2002,
     and $21,000 per month thereafter if the contract continued in effect. The
     Service Agreement provided for a term of 22 months and allowed
     termination with a 30-day written notice by either party. The Company has
     been notified that Crosby will cancel the contract effective March 31,
     2002.

     The Company recognized a gain of $3,452,000 on the transfer of the
     partnership interests to Crosby, representing the excess of the fair
     value over the book value of the interests transferred. The Company
     recognized an extraordinary gain of $4,888,000 on the extinguishment of
     the debt due to Crosby, net of income taxes of $2,517,000.

     In connection with the above-referenced transaction, 1,000,000 shares of
     the Company's common stock which were held by Crosby prior to the
     transaction, were transferred to members of management and the Board of
     Directors of the Company, effective June 8, 2000. As of such date, the
     aggregate market value of the common

                                      37

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     stock transferred to members of management and the Board of Directors was
     approximately $25,000 based on the last sale price on the OTC Bulletin
     Board of a depositary share representing five shares of the Company's
     common stock. Additionally, 200,000 shares of the Company's common stock
     which were held by Crosby prior to the transaction were transferred to a
     consultant of the Company effective as of the same date.

(3)  OTHER ASSETS

     A summary of other assets follows:
                                                         December 31
                                                   -----------------------
                                                         (thousands)
                                                         2001         2000
                                                     --------     --------
     Abandonment funds for U.S. offshore properties  $    989     $    948
     Other                                                  2            2
                                                     --------     --------

                                                     $    991     $    950
                                                     ========     ========

(4)  INTEREST AND OTHER INCOME (EXPENSE)

     A summary of interest and other income (expense) follows:

                                                  (thousands)
                                             2001       2000     1999
                                        ---------  ---------  -------
Interest income                         $      56  $      97  $    94
Gain on settlement of disputed payable         99          -        -
Foreign currency exchange gain (loss)          11         44      193
Gain (loss) on sale of assets, net              4         (4)      11
Other, net                                     65         70      (39)
                                        ---------  ---------  -------
                                        $     235  $     207  $   259
                                        =========  =========  =======

(5)  STOCKHOLDERS' EQUITY

     Quasi-Reorganization
     Effective December 31, 1992, the Board of Directors of the Company
     approved a quasi-reorganization which resulted in a reclassification of
     the accumulated deficit of $70,057,000 at that date to paid-in capital.
     No adjustments were made to the Company's assets and liabilities since
     the historical carrying values approximated or did not exceed the
     estimated fair values.

     Stock Option Plans
     At December 31, 2001, the Company has two stock option plans, which are
     described below. The Company applies APB Opinion No. 25 and related
     Interpretations in accounting for its plans. Accordingly, no compensation
     cost has been recognized for its stock option plans. Had compensation
     cost for the Company's stock option plans been determined consistent with
     FASB Statement No. 123, the Company's net earnings (loss) and earnings
     (loss) per share would have been changed to the pro forma amounts
     indicated below (in thousands, except per share data):

                                             2001      2000     1999
                                             ----      ----     ----

Net earnings (loss)          As reported   $   77   $  10,504  $  (403)

                             Pro forma     $   77   $  10,496  $  (413)

Earnings (loss) per share    As reported   $ 0.00   $    0.22  $ (0.01)

                             Pro forma     $ 0.00   $    0.22  $ (0.01)

                                      38

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     The Aviva Petroleum Inc. 1995 Stock Option Plan, as amended (the "Current
     Plan") is administered by a committee (the "Committee") composed of
     outside directors of the Company. Except as indicated below and except
     for non-discretionary grants to non-employee directors, the Committee has
     authority to determine all terms and provisions under which options are
     granted pursuant to the Current Plan. An aggregate of up to 1,000,000
     shares of the Company's common stock may be issued upon exercise of stock
     options or in connection with restricted stock awards that may be granted
     under the Current Plan. The Current Plan also provides for the grant, on
     July 1, each year, to each non-employee director who has served in such
     capacity for at least the entire preceding calendar year of an option to
     purchase 5,000 shares of the Company's common stock (the "Annual Option
     Awards"), exercisable as to 2,500 shares on the first anniversary of the
     date of grant and as to the remaining shares on the second anniversary
     thereof.

     The aggregate fair market value (determined at the time of grant) of
     shares issuable pursuant to incentive stock options which first become
     exercisable in any calendar year by a participant in the Current Plan may
     not exceed $100,000. The maximum number of shares of common stock which
     may be subject to an option or restricted stock grant awarded to a
     participant in a calendar year cannot exceed 100,000. Incentive stock
     options granted under the Current Plan may not be granted at a price less
     than 100% of the fair market value of the common stock on the date of
     grant (or 110% of the fair market value in the case of incentive stock
     options granted to participants in the Current Plan holding 10% or more
     of the voting stock of the Company). Non-qualified stock options may not
     be granted at a price less than 50% of the fair market value of the
     common stock on the date of grant.

     As a result of the adoption of the Current Plan, during 1995 the
     Company's former Incentive and Non-Statutory Stock Option Plan was
     terminated as to the grant of new options, but options then outstanding
     for 250,000 shares of the Company's common stock remain in effect as of
     December 31, 2001.

     The fair value of each option grant is estimated on the date of grant
     using the Black-Scholes option-pricing model with the following
     weighted-average assumptions:

                                     2001       2000      1999
                                 ----------  --------- ---------
Expected life (years)                10.0       10.0      10.0
Risk-free interest rate              5.42%      6.03%      5.8%
Volatility                          103.0%     124.0%     87.0%
Dividend yield                        0.0%       0.0%      0.0%

     A summary of the status of the Company's two fixed stock option plans as
     of December 31, 2001, 2000 and 1999, and changes during the years ended
     on those dates is presented below:

<TABLE>
<CAPTION>
                              2001                      2000                     1999
                        ---------------------   --------------------     -----------------------

                                    Weighted-              Weighted-                  Weighted-
                                    Average                Average                    Average
                         Shares     Exercise      Shares   Exercise       Shares      Exercise
Fixed Options             (000)      Price        (000)     Price         (000)        Price
-------------           --------  -----------   --------   ---------     ---------    ----------
<S>                       <C>      <C>            <C>       <C>            <C>        <C>

Outstanding at
   beginning of year       1,024    $    .51       1,072     $   .51         1,148      $    .53
Granted                        5         .07           5         .08             5           .01
Forfeited                   (140)        .81         (53)        .17           (81)          .74
                          ------                  ------                    ------
Outstanding at
   end of year               889         .45       1,024         .51         1,072           .51
                          ======                  ======                    ======
Options exercisable
   at year-end               882                   1,007                       825
                          ======                  ======                    ======
Weighted-average fair
   value of options
   granted during the
   year                   $  .06                  $  .07                    $  .01
                          ======                  ======                    ======

</TABLE>
                                      39

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     The following table summarizes information about fixed stock options
     outstanding at December 31, 2001:

<TABLE>
<CAPTION>
                                   Options Outstanding                       Options Exercisable
                      ----------------------------------------------   --------------------------------
       Range              Number      Weighted-Avg.                       Number
        of             Outstanding     Remaining       Weighted-Avg.    Exercisable     Weighted-Avg.
  Exercise Prices      at 12/31/01  Contractual Life  Exercise Price    at 12/31/01     Exercise Price
-------------------   ------------  ----------------  --------------   -------------   ----------------
<S>                       <C>          <C>               <C>                <C>             <C>
$  .01  to    .08         609,000      6.83 years        $  .06             601,500         $  .06
       .52                 30,000      1.45                 .52              30,000            .52
  1.08  to   2.45         250,000      1.24                1.41             250,000           1.41
-----------------     -----------                                      ------------
$  .01  to   2.45         889,000      5.08                 .45             881,500            .46
=================     ===========                                      ============
</TABLE>

(6)  INCOME TAXES

     Income tax expense includes current Colombian income taxes of $74,000 in
     2001, $241,000 in 2000, and $282,000 in 1999. Income tax expense also
     includes state income taxes of $10,000 in 2001, $12,000 in 2000 and $-0-
     in 1999.

     Income tax expense for the years ended December 31, 2001 and 2000,
     differed from the amount computed by applying the statutory U.S. federal
     income tax rate (34%) to income before income taxes as a result of the
     following (in thousands):

                                                  2001         2000
                                               ---------    ----------

Computed expected tax expense                  $      55    $    1,773
Decrease in valuation allowance                   (5,362)      (17,856)
Expiration of net operating loss carryforwards     3,555        15,467
Foreign income taxes and other                     1,836           869
                                               ---------    ----------
                                               $      84    $      253
                                               =========    ==========

     During the year ended December 31, 1999, the Company's effective tax rate
     differed from the U. S. statutory rate principally due to losses without
     tax benefit.

     The Company has deferred tax assets of $18,259,000 and $23,621,000 at
     December 31, 2001 and 2000, respectively, consisting principally of net
     operating loss carryforwards. The valuation allowance for deferred tax
     assets at January 1, 1999 was $46,028,000. The net change in the valuation
     allowance was a $5,362,000 decrease in 2001, a $20,711,000 decrease in
     2000, and a $1,696,000 decrease in 1999. Subsequently recognized tax
     benefits relating to the valuation allowance of $9,327,000 for deferred
     tax assets at January 1, 1993 will be credited to additional paid in
     capital. Such benefits were $2,855,000 during the year ended December 31,
     2000.

     At December 31, 2001, the Company and its subsidiaries have aggregate net
     operating loss carryforwards for U.S. federal income tax purposes of
     approximately $47,000,000, expiring from 2002 through 2021, which are
     available to offset future federal taxable income. The utilization of a
     portion of these net operating losses is subject to an annual limitation
     of approximately $2,400,000 and a portion may only be utilized by certain
     subsidiaries of the Company.

(7)  FINANCIAL INSTRUMENTS AND CREDIT RISK CONCENTRATIONS

     Financial instruments which are subject to risks due to concentrations of
     credit consist principally of cash and cash equivalents and receivables.
     Cash and cash equivalents are placed with high credit quality financial
     institutions to minimize risk. Receivables are typically unsecured.
     Historically, the Company has not experienced any material collection
     difficulties from its customers.

     The carrying values of cash equivalents, accounts receivable and accounts
     payable approximate fair value due to the current maturities of these
     financial instruments.

                                      40

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     Ecopetrol has an option to purchase all of the Company's production in
     Colombia. For the years ended December 31, 2001, 2000 and 1999, Ecopetrol
     exercised that option and sales to Ecopetrol accounted for $1,253,000
     (59%), $4,267,000 (74%) and $5,683,000 (84%) respectively, of the
     Company's aggregate oil and gas sales.

     For the years ended December 31, 2001 and 2000, sales to one U.S.
     purchaser accounted for $782,000 (37%) and $968,000 (17%), respectively,
     of oil and gas sales. During 1999, the Company did not receive more than
     10% of its revenue from any one domestic purchaser.

(8)  COMMITMENTS AND CONTINGENCIES

     During the latter part of 2001, an offset operator drilled a successful
     exploratory well approximately 4,000 feet from the eastern boundary of the
     Company's Breton Sound acreage. Management of the Company is currently in
     discussions with such operator, and other interested parties, with a view
     towards negotiating an arrangement to explore the Company's Breton Sound
     prospects. At this time it is not possible to predict the cost, if any,
     net to the Company, that may arise should management successfully
     negotiate such an arrangement.

     The Company is also engaged in ongoing operations in Colombia. The
     obligations under the Santana contract have been met; however, Argosy
     plans to recomplete certain existing wells and engage in various other
     projects. The first of these recompletions is scheduled during 2003, and
     the majority of the remaining recompletions are scheduled during 2004. The
     Company's share of the estimated future costs of these activities is
     approximately $0.2 million at December 31, 2001.

     The contract obligations of the Rio Magdalena contract require Argosy and
     its co-owner to reprocess 40 kilometers of 2D seismic during the initial
     18-month exploration phase of the contract. The Company's current share of
     the estimated future costs of this phase is approximately $74,000 at
     December 31, 2001. Additional expenditures will be required should Argosy
     decide to enter into the second phase of the contract.

     The proposed obligations of the Guayuyaco contract will require Argosy to
     drill one exploratory well during the initial 12- month exploration phase
     of the contract. Upon completion of the initial exploration phase, Argosy
     may relinquish the contract or proceed to the following 18-month
     exploration phase, whereunder Argosy will be obligated to drill a second
     exploratory well. Argosy is continuing its efforts to secure an industry
     partner to farm-in to this acreage and expects to drill the first
     exploratory well during the second quarter of 2003.

     Failure by Argosy to meet the obligations under the proposed Guayuyaco
     contract will result in the loss of the proposed contract terms. The
     existing Santana production and acreage will not be affected. Failure by
     the Company to fund its share of Argosy's obligations, assuming Argosy
     funds the obligation, could result in a decrease in the Company's
     ownership interest in Argosy.

     The Company expects to fund its share of the cost of the recompletions on
     the Santana contract and the seismic commitments on the Rio Magdalena
     contract using existing cash and cash provided from operations. Any
     substantial increase in the amount of the above referenced expenditures
     could adversely affect the Company's ability to fund these activities.
     Risks that could adversely affect funding of such activities include,
     among others, delays in obtaining any required environmental permits, cost
     overruns, failure to produce the reserves as projected or a decline in the
     sales price of oil.  Depending on the results of future exploration and
     development activities, substantial expenditures which have not been
     included in the Company's projections may be required.  Although the
     ultimate outcome of these matters cannot be projected with certainty,
     management believes that the Company's existing capital resources are
     adequate to fund its current obligations. If, however, the Company enters
     into an arrangement to explore its Breton Sound acreage, the Company's
     existing capital resources may be inadequate to fund the Company's share,
     if any, of the exploration program. Accordingly,

                                      41

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     the Company may be required to raise additional capital through equity
     issues, incurring debt or by sales of assets. There can be no assurance
     that such attempts to raise additional capital would be successful.

     During 1998, leftist Colombian guerrillas inflicted significant damage on
     Argosy's oil processing and storage facilities. Since that time Argosy has
     been subject to lesser attacks on its pipelines and equipment resulting in
     only minor interruptions of oil sales. The Colombian army guards the
     Company's operations; however, there can be no assurance that such
     operations will not be the target of additional guerrilla attacks in the
     future. The damages resulting from the above referenced attacks were
     covered by insurance. During 2001 the cost of such insurance became
     prohibitively high and, accordingly, Argosy has elected to no longer
     maintain terrorism insurance.

     Under the terms of the contracts with Ecopetrol, a minimum of 25% of all
     revenues from oil sold to Ecopetrol is paid in Colombian pesos which may
     only be utilized in Colombia. To date, the Company has experienced no
     difficulty in repatriating the remaining 75% of such payments, which are
     payable in U.S. dollars.

     Activities of the Company with respect to the exploration, development and
     production of oil and natural gas are subject to stringent foreign,
     federal, state and local environmental laws and regulations, including but
     not limited to the Oil Pollution Act of 1990, the Outer Continental Shelf
     Lands Act, the Federal Water Pollution Control Act, the Resource
     Conservation and Recovery Act and the Comprehensive Environmental
     Response, Compensation, and Liability Act. Such laws and regulations have
     increased the cost of planning, designing, drilling, operating and
     abandoning wells. In most instances, the statutory and regulatory
     requirements relate to air and water pollution control procedures and the
     handling and disposal of drilling and production wastes. Although the
     Company believes that compliance with environmental laws and regulations
     will not have a material adverse effect on the Company's future operations
     or earnings, risks of substantial costs and liabilities are inherent in
     oil and gas operations and there can be no assurance that significant
     costs and liabilities, including civil or criminal penalties for
     violations of environmental laws and regulations, will not be incurred.
     Moreover, it is possible that other developments, such as stricter
     environmental laws and regulations or claims for damages to property or
     persons resulting from the Company's operations, could result in
     substantial costs and liabilities. The Company's policy is to accrue
     environmental and restoration related costs once it is probable that a
     liability has been incurred and the amount can be reasonably estimated.

     The Company is involved in certain litigation involving its oil and gas
     activities. Management of the Company believes that these litigation
     matters will not have any material adverse effect on the Company's
     financial condition or results of operations.

     The Company has one lease for office space in Dallas, Texas, which expires
     in January 2007. Rent expense relating to the lease was $90,000, $88,000,
     and $94,000 for 2001, 2000 and 1999, respectively. Future minimum payments
     under the lease are approximately $94,000 for each year through 2006 and
     $8,000 for 2007.

(9)  SUBSIDIARY'S REORGANIZATION UNDER CHAPTER 11

     On July 21, 2000, AAI, a wholly-owned subsidiary of the Company, filed a
     voluntary petition for reorganization under Chapter 11 of the U.S.
     Bankruptcy code. AAI is a Delaware corporation which holds the Company's
     interests in oil and gas properties located offshore Louisiana. The
     filing, in the Northern District of Texas, was initiated in order to
     achieve a comprehensive restructuring of AAI's debts

     Following approval by the court and creditors, the voluntary petition for
     reorganization became effective on November 17, 2000. In connection with
     the reorganization, the Company recognized an extraordinary gain of
     $655,000 on the extinguishment of certain AAI debts, net of income taxes of
     $338,000.

                                       42

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(10) GEOGRAPHIC AREA INFORMATION

     The Company is engaged in the business of exploring for, developing and
     producing oil and gas in the United States and Colombia. Information about
     the Company's operations in different geographic areas as of and for the
     years ended December 31, 2001, 2000 and 1999 follows:

<TABLE>
<CAPTION>
(Thousands)                                           United
                                                      States        Colombia           Total
                                                 -----------     -----------     -----------
<S>                                              <C>             <C>             <C>
2001
----
Revenue:
   Oil and gas sales                             $       883     $     1,253     $     2,136
   Service fees                                          473               -             473
                                                 -----------     -----------     -----------
                                                       1,356           1,253           2,609
                                                 -----------     -----------     -----------
Expense:
   Production                                            785             617           1,402
   Depreciation, depletion and amortization              219             101             320
   General and administrative                            904             102           1,006
   Recovery of losses on accounts receivable             (48)              -             (48)
                                                 -----------     -----------     -----------
                                                       1,860             820           2,680
                                                 -----------     -----------     -----------

Interest and other income (expense), net                  56             179             235
Interest expense                                          (3)              -              (3)
                                                 -----------     -----------     -----------

Earnings (loss) before income taxes and
   extraordinary item                                   (451)            612             161
Income taxes                                             (10)            (74)            (84)
                                                 -----------     -----------     -----------

Net earnings (loss)                              $      (461)    $       538     $        77
                                                 ===========     ===========     ===========

Total assets                                     $     1,602     $     1,532     $     3,134
                                                 ===========     ===========     ===========
</TABLE>

                                       43

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

<TABLE>
<CAPTION>
(Thousands)

                                                United
                                                States          Colombia            Total
                                             ---------         ---------        ---------
<S>                                           <C>               <C>              <C>
2000
----
Revenue:
   Oil and gas sales                          $  1,528          $  4,268         $  5,796
   Service fees                                    387                 -              387
                                             ---------         ---------        ---------
                                                 1,915             4,268            6,183
                                             ---------         ---------        ---------
Expense:
   Production                                    1,099             1,308            2,407
   Depreciation, depletion and amortization        131               384              515
   General and administrative                    1,077                80            1,157
   Recovery of losses on accounts receivable      (256)                -             (256)
                                             ---------         ---------        ---------
                                                 2,051             1,772            3,823
                                             ---------         ---------        ---------

Gain on transfer of partnership interests            -             3,452            3,452
Interest and other income (expense), net            39               168              207
Interest expense                                  (183)             (622)            (805)
                                             ---------         ---------        ---------

Earnings (loss) before income taxes and
   extraordinary item                             (280)            5,494            5,214
Income taxes                                       (12)             (241)            (253)
                                             ---------         ---------        ---------

Earnings (loss) before extraordinary item         (292)            5,253            4,961
Extraordinary item - debt extinguishment           655             4,888            5,543
                                             ---------         ---------        ---------
Net earnings                                  $    363          $ 10,141         $ 10,504
                                             =========         =========        =========

Total assets                                  $  1,662          $  1,649         $  3,311
                                             =========         =========        =========

1999
----
Oil and gas sales                             $  1,114          $  5,683         $  6,797
                                             ---------         ---------        ---------
Expense:
   Production                                    1,173             2,402            3,575
   Depreciation, depletion and amortization         59               941            1,000
   General and administrative                    1,148                97            1,245
   Recovery of losses on accounts receivable      (101)                -             (101)
   Severance                                        -                 62               62
                                             ---------         ---------        ---------
                                                 2,279             3,502            5,781
                                             ---------         ---------        ---------

Interest and other income (expense), net           154               105              259
Interest expense                                  (397)             (999)          (1,396)
                                             ---------         ---------        ---------

Earnings (loss) before income taxes             (1,408)            1,287             (121)
Income taxes                                         -              (282)            (282)
                                             ---------         ---------        ---------

Net earnings (loss)                           $ (1,408)         $  1,005         $   (403)
                                             =========         =========        =========

Total assets                                  $  1,908          $  7,078         $  8,986
                                             =========         =========        =========
</TABLE>

                                      44

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(11)  QUARTERLY FINANCIAL DATA (UNAUDITED)

      Quarterly operating results for 2001 and 2000 are summarized as follows
      (in thousands, except per share data):

<TABLE>
<CAPTION>
Quarter Ended                              March 31         June 30    September 30     December 31
                                        -----------     -----------    ------------     -----------

<S>                                        <C>             <C>             <C>            <C>
2001
----
Revenues                                   $    766        $    682        $    654       $    507
                                           ========        ========        ========       ========
Operating earnings                               77             (26)             35           (157)
                                           ========        ========        ========       ========
Net earnings (loss)                             229             (44)             40           (148)
                                           ========        ========        ========       ========
Basic and diluted earnings (loss) per
   common share                            $   0.00        $  (0.00)       $   0.00       $  (0.00)
                                           ========        ========        ========       ========

2000
----
Revenues                                   $  2,541        $  1,827        $    907       $    908
                                           ========        ========        ========       ========
Operating earnings                            1,247             696             208            209
                                           ========        ========        ========       ========
Net earnings before extraordinary item          733           3,887             134            207
                                           ========        ========        ========       ========
Extraordinary item - debt extinguishment          -           3,089              (5)         2,459
                                           ========        ========        ========       ========
Net earnings                                    733           6,976             129          2,666
                                           ========        ========        ========       ========
Basic and diluted earnings (loss) per
   common share:
      Before extraordinary item                0.02            0.08            0.00           0.00
                                           ========        ========        ========       ========
      Extraordinary item                          -            0.07           (0.00)          0.05
                                           ========        ========        ========       ========
      Net earnings                         $   0.02        $   0.15        $   0.00       $   0.05
                                           ========        ========        ========       ========
</TABLE>

                                      45

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
      SUPPLEMENTARY INFORMATION RELATED TO OIL AND GAS PRODUCING ACTIVITIES
                                  (UNAUDITED)

The following information relating to the Company's oil and gas activities is
presented in accordance with Statement of Financial Accounting Standards No.
69. The Financial Accounting Standards Board has determined the information is
necessary to supplement, although not required to be a part of, the basic
financial statements.

Capitalized costs and accumulated depreciation, depletion and amortization
relating to oil and gas producing activities were as follows:

(Thousands)

                                        United
                                        States      Colombia          Total
                                     ---------     ---------      ---------

December 31, 2001
-----------------

Unevaluated oil and gas properties   $     184     $     119      $     303
Proved oil and gas properties            4,008        15,933         19,941
                                     ---------     ---------      ---------

   Total capitalized costs               4,192        16,052         20,244

Less accumulated depreciation,
   depletion and amortization            4,368        15,335         19,703
                                     ---------     ---------      ---------

      Capitalized costs, net         $    (176)    $     717      $     541
                                     =========     =========      =========

December 31, 2000
-----------------

Unevaluated oil and gas properties   $     184     $      88      $     272
Proved oil and gas properties            3,936        12,206         16,142
                                     ---------     ---------      ---------

   Total capitalized costs               4,120        12,294         16,414

Less accumulated depreciation,
   depletion and amortization            4,177        11,360         15,537
                                     ---------     ---------      ---------

      Capitalized costs, net         $     (57)    $     934      $     877
                                     =========     =========      =========

                                      46

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
      SUPPLEMENTARY INFORMATION RELATED TO OIL AND GAS PRODUCING ACTIVITIES
                            (UNAUDITED) (CONTINUED)

Costs incurred in oil and gas property acquisition, exploration and development
activities were as follows:

  (Thousands)
                                  United
                                  States     Colombia        Total
                             -----------  -----------  -----------
2001
----

Exploration                  $         -  $         -  $         -
Development                           72           19           91
                             -----------  -----------  -----------
   Total costs incurred      $        72  $        19  $        91
                             ===========  ===========  ===========

2000
----

Exploration                  $        10  $         4  $        14
Development                          238          110          348
                             -----------  -----------  -----------
   Total costs incurred      $       248  $       114  $       362
                             ===========  ===========  ===========

1999
----

Exploration                  $        17  $        41  $        58
Development                           85           81          166
                             -----------  -----------  -----------
   Total costs incurred      $       102  $       122  $       224
                             ===========  ===========  ===========

                                      47

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
      SUPPLEMENTARY INFORMATION RELATED TO OIL AND GAS PRODUCING ACTIVITIES
                            (UNAUDITED) (CONTINUED)

The following schedule presents the Company's estimate of its proved oil and
gas reserves. The proved oil and gas reserves in Colombia and the United States
were determined by independent petroleum engineers, Huddleston & Co., Inc. and
Netherland, Sewell & Associates, Inc., respectively. The figures presented are
estimates of reserves which may be expected to be recovered commercially at
current prices and costs. Estimates of proved developed reserves include only
those reserves which can be expected to be recovered through existing wells
with existing equipment and operating methods. Estimates of proved undeveloped
reserves include only those reserves which are expected to be recovered on
undrilled acreage from new wells which are reasonably certain of production
when drilled or from presently existing wells which could require relatively
major expenditures to effect recompletion.

<TABLE>
<CAPTION>
                                                Changes in the Estimated Quantities of Reserves
                                            --------------------------------------------------------
                                                   United
                                                   States               Colombia               Total
                                            -------------          -------------       -------------
<S>                                                   <C>                    <C>                 <C>
Year ended December 31, 2001
----------------------------

Oil (Thousands of barrels)
Proved reserves:
   Beginning of period                                174                    696                 870

   Revisions of previous estimates                    (66)                     3                 (63)
   Purchase of reserves                                 5                      -                   5
   Production                                         (33)                   (61)                (94)
                                            -------------          -------------       -------------

   End of period                                       80                    638                 718
                                            =============          =============       =============
Proved developed reserves, end of period               80                    638                 718
                                            =============          =============       =============

Gas (Millions of cubic feet)
Proved reserves:
   Beginning of period                                114                      -                 114
   Revisions of previous estimates                    (67)                     -                 (67)
   Purchase of reserves                                 2                      -                   2
   Production                                         (24)                     -                 (24)
                                            -------------          -------------       -------------
   End of period                                       25                      -                  25
                                            =============          =============       =============
Proved developed reserves, end of period               25                      -                  25
                                            =============          =============       =============
</TABLE>

                                      48

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
      SUPPLEMENTARY INFORMATION RELATED TO OIL AND GAS PRODUCING ACTIVITIES
                            (UNAUDITED) (CONTINUED)

<TABLE>
<CAPTION>
                                                Changes in the Estimated Quantities of Reserves
                                            --------------------------------------------------------
                                                   United
                                                   States               Colombia               Total
                                            -------------          -------------       -------------
<S>                                                   <C>                 <C>                 <C>
Year ended December 31, 2000
----------------------------

Oil (Thousands of barrels)
Proved reserves:
   Beginning of period                                144                  2,208               2,352
   Revisions of previous estimates                     79                    259                 338
   Sales of reserves                                    -                 (1,614)             (1,614)
   Production                                         (49)                  (157)               (206)
                                            -------------          -------------       -------------

   End of period                                      174                    696                 870
                                            =============          =============       =============

Proved developed reserves, end of period              174                    696                 870
                                            =============          =============       =============

Gas (Millions of cubic feet)
Proved reserves:
   Beginning of period                                101                      -                 101
   Revisions of previous estimates                     38                      -                  38
   Production                                         (25)                     -                 (25)
                                            -------------          -------------       -------------

   End of period                                      114                      -                 114
                                            =============          =============       =============
Proved developed reserves, end of period              114                      -                 114
                                            =============          =============       =============
</TABLE>

                                      49

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
      SUPPLEMENTARY INFORMATION RELATED TO OIL AND GAS PRODUCING ACTIVITIES
                            (UNAUDITED) (CONTINUED)

<TABLE>
<CAPTION>
                                                 Changes in the Estimated Quantities of Reserves
                                             -----------------------------------------------------
                                                 United
                                                 States            Colombia                  Total
                                             ----------          ----------             ----------
<S>                                                 <C>               <C>                    <C>

Year ended December 31, 1999
----------------------------

Oil (Thousands of barrels)
Proved reserves:
   Beginning of period                                8               2,352                  2,360
   Revisions of previous estimates                  193                 221                    414
   Discoveries and extensions                         -                   -                      -
   Sales of reserves                                  -                   -                      -
   Production                                       (57)               (365)                  (422)
                                             ----------          ----------             ----------
End of period                                       144               2,208                  2,352
                                             ==========          ==========             ==========
Proved developed reserves, end of period            144               2,208                  2,352
                                             ==========          ==========             ==========

Gas (Millions of cubic feet)
Proved reserves:
   Beginning of period                                4                   -                      4
   Revisions of previous estimates                  150                   -                    150
   Discoveries and extensions                         -                   -                      -
   Sales of reserves                                  -                   -                      -
   Production                                       (53)                  -                    (53)
                                             ----------          ----------             ----------
   End of period                                    101                   -                    101
                                             ==========          ==========             ==========
Proved developed reserves, end of period            101                   -                    101
                                             ==========          ==========             ==========
</TABLE>

                                       50

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
      SUPPLEMENTARY INFORMATION RELATED TO OIL AND GAS PRODUCING ACTIVITIES
                            (UNAUDITED) (CONTINUED)

The following schedule is a standardized measure of the discounted net future
cash flows applicable to proved oil and gas reserves. The future cash flows are
based on estimated oil and gas reserves utilizing prices and costs in effect as
of the applicable year end, discounted at ten percent per year and assuming
continuation of existing economic conditions. The standardized measure of
discounted future net cash flows, in the Company's opinion, should be examined
with caution. The schedule is based on estimates of the Company's proved oil
and gas reserves prepared by independent petroleum engineers. Reserve estimates
are, however, inherently imprecise and estimates of new discoveries are more
imprecise than those of producing oil and gas properties. Accordingly, the
estimates are expected to change as future information becomes available.
Therefore, the standardized measure of discounted future net cash flows does
not necessarily reflect the fair value of the Company's proved oil and gas
properties.

(Thousands)                                    United
                                               States    Colombia        Total
                                            ---------   ---------    ---------

At December 31, 2001:
--------------------

Future gross revenues                       $   1,436   $  10,519    $  11,955
Future production costs                        (1,288)     (6,335)      (7,623)
Future development costs, including
   abandonment of U.S. offshore platforms        (799)       (354)      (1,153)
                                            ---------   ---------    ---------
Future net cash flows before
   income taxes                                  (651)      3,830        3,179

Future income taxes                                 -           -            -
                                            ---------   ---------    ---------
Future net cash flows after
   income taxes                                  (651)      3,830        3,179

Discount at 10% per annum                         236      (1,130)        (894)
                                            ---------   ---------    ---------
Standardized measure of discounted
   future net cash flows                    $    (415)  $   2,700    $   2,285
                                            =========   =========    =========

At December 31, 2000:
--------------------

Future gross revenues                       $   5,520   $  12,501    $  18,021
Future production costs                        (3,887)     (5,994)      (9,881)
Future development costs, including
   abandonment of U.S. offshore platforms        (745)       (390)      (1,135)
                                            ---------   ---------    ---------
Future net cash flows before
   income taxes                                   888       6,117        7,005

Future income taxes                                 -           -            -
                                            ---------   ---------    ---------
Future net cash flows after
   income taxes                                   888       6,117        7,005

Discount at 10% per annum                         120      (1,942)      (1,822)
                                            ---------   ---------    ---------
Standardized measure of discounted
   future net cash flows                    $   1,008   $   4,175    $   5,183
                                            =========   =========    =========

                                      51

<PAGE>

                      AVIVA PETROLEUM INC. AND SUBSIDIARIES
      SUPPLEMENTARY INFORMATION RELATED TO OIL AND GAS PRODUCING ACTIVITIES
                            (UNAUDITED) (CONTINUED)

(Thousands)                                    United
                                               States    Colombia        Total
                                            ---------   ---------    ---------

At December 31, 1999:
--------------------
Future gross revenues                       $   3,708   $  53,112    $  56,820
Future production costs                        (2,792)    (15,195)     (17,987)
Future development costs, including
   abandonment of U.S. offshore platforms        (970)     (1,075)      (2,045)
                                            ---------   ---------    ---------
Future net cash flows before
   income taxes                                   (54)     36,842       36,788

Future income taxes                                 -           -            -
                                            ---------   ---------    ---------
Future net cash flows after
   income taxes                                   (54)     36,842       36,788

Discount at 10% per annum                         171      (8,699)      (8,528)
                                            ---------   ---------    ---------
Standardized measure of discounted
   future net cash flows                    $     117   $  28,143    $  28,260
                                            =========   =========    =========

The following schedule summarizes the changes in the standardized measure of
discounted future net cash flows.

(Thousands)
                                                    2001        2000       1999
                                               ---------   ---------  ---------
Sales of oil and gas, net of production costs  $    (735)  $  (3,389) $  (3,222)
Sales of reserves in place                             -     (20,094)         -
Development costs incurred that reduced
   future development costs                           35          36          -
Accretion of discount                                518       2,826        462
Discoveries and extensions                             -           -          -
Purchase of reserves in place                        (32)          -          -
Revisions of previous estimates:
   Changes in price                               (2,561)     (1,921)    24,161
   Changes in quantities                            (146)      1,422      4,103
   Changes in future development costs               (78)       (236)       297
   Changes in timing and other changes               101      (1,721)    (2,160)
   Changes in estimated income taxes                   -           -          -
                                               ---------   ---------  ---------
   Net increase (decrease)                        (2,898)    (23,077)    23,641

Balances at beginning of year                      5,183      28,260      4,619
                                               ---------   ---------  ---------
Balances at end of year                        $   2,285   $   5,183  $  28,260
                                               =========   =========  =========

                                      52

<PAGE>

                                INDEX TO EXHIBITS
<TABLE>
<CAPTION>
                                                                                Sequentially
                                                                                Numbered
Number                          Description of Exhibit                            Page
------                          ----------------------                          ------------
<S>          <C>                                                                <C>
     *2.1    Agreement and Plan of Merger dated as of June 24, 1998, by and
             among Aviva Petroleum Inc., Aviva Merger Inc. and Garnet
             Resources Corporation (filed as exhibit 2.1 to the Registration
             Statement on Form S-4, File No. 333-58061, and incorporated
             herein by reference).
     *2.2    Debenture Purchase Agreement dated as of June 24, 1998, between
             Aviva Petroleum Inc. and the Holders of the Debentures named
             therein (filed as exhibit 2.2 to the Registration Statement on
             Form S-4, file No. 333-58061, and incorporated herein by
             reference).
     *3.1    Restated Articles of Incorporation of the Company dated July
             25, 1995 (filed as exhibit 3.1 to the Company's annual report
             on Form 10-K for the year ended December 31, 1995, File No.
             0-22258, and incorporated herein by reference).
     *3.2    Amended and Restated Bylaws of the Company, as amended as of
             January 23, 1995 (filed as exhibit 3.2 to the Company's annual
             report on Form 10-K for the year ended December 31, 1994, File
             No. 0-22258, and incorporated herein by reference).
     *10.1   Risk Sharing Contract between Empresa Colombiana de Petroleos
             ("Ecopetrol"), Argosy Energy International ("Argosy") and Neo
             Energy, Inc. ("Neo") (filed as exhibit 10.1 to the Company's
             Registration Statement on Form10, File No. 0-22258, and
             incorporated herein by reference).
     *10.2   Contract for Exploration and Exploitation of Sector Number 1 of
             the Aporte Putumayo Area ("Putumayo") between Ecopetrol and
             Cayman Corporation of Colombia dated July 24, 1972 (filed as
             exhibit 10.2 to the Company's Registration Statement on Form10,
             File No. 0-22258, and incorporated herein by reference).
     *10.3   Operating Agreement for Putumayo between Argosy and Neo dated
             September 16, 1987 and amended on January 4, 1989 and February
             23, 1990 (filed as exhibit 10.3 to the Company's Registration
             Statement on Form10, File No. 0-22258, and incorporated herein
             by reference).
     *10.4   Operating Agreement for the Santana Area ("Santana") between
             Argosy and Neo dated September 16, 1987 and amended on January
             4, 1989, February 23, 1990 and September 28, 1992 (filed as
             exhibit 10.4 to the Company's Registration Statement on Form10,
             File No. 0-22258, and incorporated herein by reference).
     *10.5   Santana Block A Relinquishment dated March 6, 1990 between
             Ecopetrol, Argosy and Neo (filed as exhibit 10.8 to the
             Company's Registration Statement on Form10, File No. 0- 22258,
             and incorporated herein by reference).
     *10.6   Employee Stock Option Plan of the Company (filed as exhibit
             10.13 to the Company's Registration   Statement   on   Form10,
             File   No.   0-22258,   and   incorporated   herein   by
             reference).
     *10.7   Santana   Block   B   50%   relinquishment   dated   September
             13,   1993   between   Ecopetrol, Argosy and Neo (filed as
             exhibit 10.26 to the Company's annual report on Form 10-K for
             the   year   ended   December   31,   1993,   File   No.
             0-22258,   and   incorporated   herein   by reference).
     *10.8   Aviva Petroleum Inc. 401(k) Retirement Plan effective March 1,
             1992 (filed as exhibit 10.29 to the Company's annual report on
             Form 10-K for the year ended December 31, 1993, File No.
             0-22258, and incorporated herein by reference).
     *10.9   Relinquishment   of   Putumayo   dated   December   1,   1993
             (filed   as   exhibit   10.30   to   the Company's annual
             report on Form 10-K for the year ended December 31, 1993, File
             No. 0- 22258, and incorporated herein by reference).
     *10.10  Deposit   Agreement   dated   September   15,   1994   between
             the   Company   and   Chemical Shareholder Services Group, Inc.
             (filed as exhibit 10.29 to the Company's Registration Statement
             on Form S-1, File No. 33-82072, and incorporated herein by
             reference).
     *10.11  Letter from Ecopetrol dated December 28, 1994, accepting
             relinquishment of Putumayo (filed as exhibit 10.38 to the
             Company's annual report on Form 10-K for the year ended
             December 31, 1994, File No. 0-22258, and incorporated herein by
             reference).
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
                                                                                Sequentially
                                                                                Numbered
Number                          Description of Exhibit                            Page
------                          ----------------------                          ------------
<S>          <C>                                                                <C>
     *10.12  Amendment to the Incentive and Nonstatutory Stock Option Plan
             of the Company (filed as exhibit 10.4 to the Company's
             quarterly report on Form 10-Q for the quarter ended September
             30, 1995, File No. 0-22258, and incorporated herein by
             reference).
     *10.13  Santana Block B 25% relinquishment dated October 2, 1995 (filed
             as exhibit 10.51 to the Company's annual report on Form 10-K
             for the year ended December 31, 1995, File No. 0- 22258, and
             incorporated herein by reference).
     *10.14  Aviva Petroleum Inc. 1995 Stock Option Plan, as amended (filed
             as Appendix A to the Company's definitive Proxy Statement for
             the Annual Meeting of Shareholders dated June 10, 1997, and
             incorporated herein by reference).
     *10.15  Restated Credit Agreement dated as of October 28, 1998, between
             Neo Energy, Inc., Aviva Petroleum Inc. and ING (U.S.) Capital
             Corporation (filed as exhibit 99.1 to the Company's Form 8-K
             dated October 28, 1998, File No. 0-22258, and incorporated
             herein by reference).
     *10.16  Joint Finance and Intercreditor Agreement dated as of October
             28, 1998, between Neo Energy, Inc., Aviva Petroleum Inc., ING
             (U.S.) Capital Corporation, Aviva America, Inc., Aviva
             Operating Company, Aviva Delaware Inc., Garnet Resources
             Corporation, Argosy Energy   Incorporated,   Argosy    Energy
             International,   Garnet   PNG   Corporation,   the Overseas
             Private Investment Corporation, Chase Bank of Texas, N.A. and
             ING (U.S.) Capital Corporation as collateral agent for the
             creditors (filed as exhibit 99.2 to the Company's Form 8-K
             dated October 28, 1998, File No. 0-22258, and incorporated
             herein by reference).
     *10.17  Amended and Restated Aviva Petroleum Inc. Severance Benefit
             Plan dated December 31, 1999 (filed as exhibit 10.18 to the
             Company's annual report on Form 10-K for the year ended
             December 31, 1999, File No. 0-22258, and incorporated herein by
             reference).
     *10.18  Santana Crude Sale and Purchase Agreement dated January 3, 2000
             (filed as exhibit 10.19 to the Company's annual report on Form
             10-K for the year ended December 31, 1999, File No. 0-22258,
             and incorporated herein by reference).
     *10.19  Employment Agreement between the Company and Ronald Suttill
             dated February 1, 2000 (filed as exhibit 10.20 to the Company's
             annual report on Form 10-K for the year ended December 31,
             1999, File No. 0-22258, and incorporated herein by reference).
     *10.20  Employment Agreement between the Company and James L. Busby
             dated February 1, 2000 (filed as exhibit 10.21 to the Company's
             annual report on Form 10-K for the year ended December 31,
             1999, File No. 0-22258, and incorporated herein by reference).
     *10.21  Service Agreement between Argosy Energy International and
             Aviva Overseas, Inc. dated as of June 1, 2000 (filed as exhibit
             10.1 to the Company's quarterly report on Form 10-Q for   the
             quarter   ended   June   30,   2000,   File   No.   0-22258,
             and   incorporated   herein   by reference).
     *10.22  Letter Agreement dated June 8, 2000 between Crosby Capital, LLC
             and Aviva America, Inc. (filed as exhibit 10.2 to the Company's
             quarterly report on Form 10-Q for the quarter ended June 30,
             2000, File No. 0-22258, and incorporated herein by reference).
     *10.23  Guaranty dated May 31, 2000 made by Aviva Overseas, Inc. in
             favor of Crosby Capital, LLC (filed as exhibit 10.3 to the
             Company's quarterly report on Form 10-Q for the quarter ended
             June 30, 2000, File No. 0-22258, and incorporated herein by
             reference).
     *10.24  Assignment and Assumption Agreement dated June 1, 2000, between
             Crosby Capital, LLC and Neo Energy, Inc. (filed as exhibit 10.4
             to the Company's quarterly report on Form 10-Q for the quarter
             ended June 30, 2000, File No. 0-22258, and incorporated herein
             by reference).
     *10.25  Assignment and Assumption Agreement dated June 1, 2000 between
             Crosby Acquisition LLC and Argosy Energy, Inc. (filed as
             exhibit 10.5 to the Company's quarterly report on Form 10-Q for
             the quarter ended June 30, 2000, File No. 0-22258, and
             incorporated herein by reference).
     *10.26  Assignment and Assumption Agreement dated June 1, 2000 between
             Crosby Capital, LLC and Garnet Resources Corp. (filed as
             exhibit 10.6 to the Company's quarterly report on
             Form 10-Q for the quarter ended June 30, 2000, File No.
             0-22258, and incorporated herein by reference).
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
                                                                                Sequentially
                                                                                Numbered
Number                          Description of Exhibit                            Page
------                          ----------------------                          ------------
<S>          <C>                                                                <C>
     *10.27  Assignment and Assumption Agreement dated June 1, 2000 between
             Crosby Capital, LLC and Aviva Overseas, Inc. (filed as exhibit
             10.7 to the Company's quarterly report on Form 10-Q for the
             quarter ended June 30, 2000, File No. 0-22258, and incorporated
             herein by reference).
     *10.28  Assignment and Assumption Agreement dated June 1, 2000 between
             Argosy Energy, Incorporated   and   Crosby   Acquisition,   LLC
             (filed   as   exhibit   10.8   to   the   Company's quarterly
             report on Form 10-Q for the quarter ended June 30, 2000, File
             No. 0-22258, and incorporated herein by reference).
     *10.29  Assignment and Assumption Agreement dated June 1, 2000 between
             Crosby Capital, LLC and Aviva Overseas, Inc. (filed as exhibit
             10.9 to the Company's quarterly report on Form 10-Q for the
             quarter ended June 30, 2000, File No. 0-22258, and incorporated
             herein by reference).
     *10.30  Pledge Agreement dated May 31, 2000 executed by Aviva Overseas,
             Inc. (Debtor) in favor of Crosby Capital, LLC (Secured Party)
             (filed as exhibit 10.10 to the Company's quarterly report   on
              Form   10-Q   for   the   quarter   ended   June   30,   2000,
              File   No.   0-22258,   and incorporated herein by reference).
     *10.31  Third Amendment to Second Amended and Restated Limited
             Partnership Agreement of Argosy Energy International dated May
             31, 2000 (filed as exhibit 10.11 to the Company's quarterly
             report on Form 10-Q for the quarter ended June 30, 2000, File
             No. 0-22258, and incorporated herein by reference).
     *10.32  Fourth Amendment to Second Amended and Restated Limited
             Partnership Agreement of Argosy Energy International dated June
             1, 2000 (filed as exhibit 10.12 to the Company's quarterly
             report on Form 10-Q for the quarter ended June 30, 2000, File
             No. 0-22258, and incorporated herein by reference).
     *10.33  Assignment of Stock Warrant Rights dated May 31, 2000 executed
             by Crosby Capital, LLC in favor of Aviva Petroleum Inc. (filed
             as exhibit 10.13 to the Company's quarterly report   on   Form
             10-Q   for   the   quarter   ended   June   30,   2000,   File
             No.   0-22258,   and incorporated herein by reference).
     *10.34  Assignment of Neo Debt and Collateral, dated December 21, 2000
             from Crosby Capital, LLC to Aviva Operating Company (filed as
             exhibit 10.34 to the Company's annual report on Form 10-K for
             the year ended December 31, 2000, File No. 0-22258, and
             incorporated herein by reference).
     *10.35  Conveyance of Net Profits Interest, dated December 21, 2000
             from Aviva America, Inc. to Crosby Capital, LLC (filed as
             exhibit 10.35 to the Company's annual report on Form 10-K for
             the year ended December 31, 2000, File No. 0-22258, and
             incorporated herein by reference).
     *10.36  Santana Crude Sale and Purchase Agreement dated January 3, 2001
             (filed as exhibit 10.1 to the Company's quarterly report on
             Form 10-Q for the quarter ended June 30, 2001, File No.
             0-22258, and incorporated herein by reference).
     **10.37 Santana Crude Sale and Purchase Agreement dated January 30,
             2002.
     **10.38 Rio Magdalena Association Contract dated December 10, 2001
             between Ecopetrol and Argosy.
     *21.1   List of subsidiaries of Aviva Petroleum Inc. (filed as exhibit
             21.1 to the company's annual report on Form 10-K for the year
             ended December 31, 2000, file No. 0-22258, and incorporated herein
             by reference).
</TABLE>

---------------------------------
*Previously Filed
**Filed Herewith