<PAGE>

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


                                   FORM 10-Q


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

             For the quarterly period ended       JUNE 30, 2000
                                            ----------------------

                                       OR

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

               For the transition period from        to
                                             --------  --------

                        Commission File Number  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
                                                                Number)

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)


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

Number of shares of Common Stock, no par value, outstanding at June 30, 2000,
was 46,900,132 of which 25,486,690 shares of Common Stock were represented by
Depositary Shares.  Each Depositary Share represents five shares of Common Stock
held by a Depositary.
<PAGE>

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.
-----------------------------

                           AVIVA PETROLEUM INC. AND SUBSIDIARIES
                           Condensed Consolidated Balance Sheet
                          (in thousands, except number of shares)
                                       (unaudited)
<TABLE>
<CAPTION>
                                                                         June 30,            December 31,
                                                                             2000                    1999
                                                                     ------------            ------------
<S>                                                                  <C>                     <C>
ASSETS

Current assets:
 Cash and cash equivalents                                           $        525            $        846
 Restricted cash                                                               --                       4
 Accounts receivable                                                          872                   1,650
 Inventories                                                                  159                     724
 Prepaid expenses and other                                                    77                     236
                                                                     ------------            ------------
   Total current assets                                                     1,633                   3,460
                                                                     ------------            ------------

Property and equipment, at cost (note 3):
 Oil and gas properties and equipment (full cost method)                   25,843                  68,462
 Other                                                                        582                     584
                                                                     ------------            ------------
                                                                           26,425                  69,046
   Less accumulated depreciation, depletion and amortization              (25,848)                (65,081)
                                                                     ------------            ------------
                                                                              577                   3,965
Other assets                                                                1,575                   1,561
                                                                     ------------            ------------
                                                                     $      3,785            $      8,986
                                                                     ============            ============

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
 Current portion of long term debt (note 4)                          $         --            $     14,495
 Accounts payable                                                           1,505                   3,081
 Accrued liabilities                                                          150                   1,024
                                                                     ------------            ------------
   Total current liabilities                                                1,655                  18,600
                                                                     ------------            ------------

Long term debt, excluding current portion (note 4)                          2,750                      --
Gas balancing obligations and other                                         1,563                   1,869
Stockholders' deficit:
 Common stock, no par value, authorized 348,500,000 shares;
   issued 46,900,132 shares                                                 2,345                   2,345
 Additional paid-in capital                                                34,855                  34,855
 Accumulated deficit/*/                                                   (39,383)                (48,683)
                                                                     ------------            ------------
   Total stockholders' deficit                                             (2,183)                (11,483)

Commitments and contingencies (notes 6 and 8)
                                                                     ------------            ------------
                                                                     $      3,785            $      8,986
                                                                     ============            ============
/*/  Accumulated deficit of $70,057 was eliminated at December 31, 1992 in connection with a
     quasi-reorganization.
</TABLE>

See accompanying notes to condensed consolidated financial statements.

                                       2
<PAGE>

                           AVIVA PETROLEUM INC. AND SUBSIDIARIES
                       Condensed Consolidated Statement of Operations
                           (in thousands, except per share data)
                                         (unaudited)
<TABLE>
<CAPTION>


                                                                Three Months Ended            Six Months Ended
                                                                     June 30,                    June 30,
<S>                                                           <C>           <C>             <C>           <C>
                                                                 2000          1999            2000          1999
                                                              -------       -------         -------       -------
Revenue:
 Oil and gas sales                                            $ 1,772       $ 1,575         $ 4,313       $ 2,759
 Services fee (note 2)                                             55            --              55            --
                                                              -------       -------         -------       -------
   Total revenue                                                1,827         1,575           4,368         2,759
                                                              -------       -------         -------       -------

Expense:
 Production                                                       744           879           1,554         1,779
 Depreciation, depletion and amortization                         162           284             397           620
 General and administrative                                       283           320             584           679
 Provision for (recovery of) losses on accounts receivable        (58)           13            (110)          (92)
 Severance                                                         --            62              --            62
                                                              -------       -------         -------       -------

   Total expense                                                1,131         1,558           2,425         3,048
                                                              -------       -------         -------       -------

Other income (expense):
 Gain on transfer of partnership interests (note 2)             3,452            --           3,452            --
 Interest and other income (expense), net (note 5)                102           248             102           177
 Interest expense                                                (289)         (283)           (684)         (574)
                                                              -------       -------         -------       -------

   Total other income (expense)                                 3,265           (35)          2,870          (397)
                                                              -------       -------         -------       -------

   Earnings (loss) before income taxes and
     extraordinary item                                         3,961           (18)          4,813          (686)

Income taxes                                                       74            64             193           127
                                                              -------       -------         -------       -------

   Earnings (loss) before extraordinary item                    3,887           (82)          4,620          (813)

Extraordinary item - gain on extinguishment
   of debt (note 2)                                             4,680             -           4,680             -
                                                              -------       -------         -------       -------

   Net earnings (loss)                                        $ 8,567       $   (82)        $ 9,300       $  (813)
                                                              =======       =======         =======       =======

Weighted average common shares outstanding -
 basic and diluted                                             46,900        46,748          46,900        46,724
                                                              =======       =======         =======       =======

Basic and diluted earnings (loss) per common share:
 Before extraordinary item                                    $   .08       $  (.00)        $   .10       $  (.02)
 Extraordinary item                                               .10             -             .10             -
                                                              -------       -------         -------       -------
 Net earnings (loss)                                          $   .18       $  (.00)        $   .20       $  (.02)
                                                              =======       =======         =======       =======

</TABLE>

See accompanying notes to condensed consolidated financial statements.

                                       3
<PAGE>

                     AVIVA PETROLEUM INC. AND SUBSIDIARIES
                 Condensed Consolidated Statement of Cash Flows
                                 (in thousands)
                                  (unaudited)


<TABLE>
<CAPTION>
                                                                           Six Months Ended
                                                                                June 30,

                                                                         2000                  1999
                                                                     --------              --------

<S>                                                                  <C>                   <C>
Net earnings (loss)                                                  $  9,300              $   (813)
Adjustments to reconcile net earnings (loss) to net
 cash provided by (used in) operating activities:
   Depreciation, depletion and amortization                               397                   620
   Gain on transfer of partnership interests                           (3,452)                   --
   Gain on debt extinguishment                                         (4,680)                   --
   Changes in working capital and other, net of effects
    of transfer of partnership interest                                  (252)               (1,000)
                                                                     --------              --------

      Net cash provided by (used in) operating activities               1,313                (1,193)
                                                                     --------              --------

Cash flows from investing activities:
   Cash balances surrendered in transfer of partnership interests      (1,386)                   --
   Property and equipment expenditures                                   (269)                 (111)
   Other                                                                   --                    32
                                                                     --------              --------

      Net cash used in investing activities                            (1,655)                  (79)
                                                                     --------              --------

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


Effect of exchange rate changes on cash and cash equivalents               21                   113
                                                                     --------              --------

Net decrease in cash and cash equivalents                                (321)               (1,459)
Cash and cash equivalents at beginning of the period                      846                 1,712
                                                                     --------              --------

Cash and cash equivalents at end of the period                       $    525              $    253
                                                                     ========              ========

</TABLE>


See accompanying notes to condensed consolidated financial statements.

                                       4
<PAGE>

                     AVIVA PETROLEUM INC. AND SUBSIDIARIES
           Condensed Consolidated Statement of Stockholders' Deficit
                    (in thousands, except number of shares)
                                  (unaudited)

<TABLE>
<CAPTION>

                                      Common Stock
                                 ------------------  Additional                   Total
                                   Number             Paid-in    Accumulated   Stockholders'
                                 of Shares   Amount   Capital      Deficit        Deficit
                                 ----------  ------  ----------  ------------  --------------
<S>                              <C>         <C>     <C>         <C>           <C>

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

Net earnings                              -       -           -        9,300           9,300
                                 ----------  ------  ----------     --------        --------

Balances at June 30, 2000        46,900,132  $2,345     $34,855     $(39,383)       $ (2,183)
                                 ==========  ======  ==========     ========        ========

</TABLE>



See accompanying notes to condensed consolidated financial statements.

                                       5
<PAGE>

                     AVIVA PETROLEUM INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                                  (unaudited)

1.   General

     The condensed consolidated financial statements of Aviva Petroleum Inc. and
     subsidiaries (the "Company" or "Aviva") included herein have been prepared
     by the Company without audit, pursuant to the rules and regulations of the
     Securities and Exchange Commission. Certain information and footnote
     disclosures normally included in financial statements prepared in
     accordance with generally accepted accounting principles have been
     condensed or omitted pursuant to such rules and regulations, although the
     Company believes that the disclosures contained herein are adequate to make
     the information presented not misleading. These condensed consolidated
     financial statements should be read in conjunction with the Company's prior
     audited yearly financial statements and the notes thereto, included in the
     Company's latest annual report on Form 10-K.

     In the opinion of the Company, all adjustments, consisting of normal
     recurring accruals, necessary to present fairly the information in the
     accompanying financial statements have been included. The results of
     operations for such interim periods are not necessarily indicative of the
     results for the full year.

     The Company's condensed consolidated financial statements have been
     presented on a going concern basis which contemplates the realization of
     assets and the satisfaction of liabilities in the normal course of
     business. As discussed in note 8 below, a significant subsidiary of the
     Company has filed a voluntary petition for reorganization under Chapter 11
     of the U.S. Bankruptcy Code. The condensed consolidated financial
     statements do not include any adjustments relating to the recoverability
     and classification of asset carrying amounts or the amount and
     classification of liabilities that might result should this subsidiary, and
     the Company, be unable to continue as a going concern.

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 (see note 4). 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 will be transferred
     from Crosby to Aviva Overseas when Crosby has 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.

     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 will provide certain services in
     administering the Colombian assets in exchange for a monthly fee. The fee
     is $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 as long as the contract

                                       6
<PAGE>

                     AVIVA PETROLEUM INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                            (unaudited) (continued)

     is in effect. The Service Agreement provides for a term of 22 months and
     will continue thereafter from month to month unless terminated by 30-day
     written notice by either party.

     Crosby retains its interest as senior secured lender in respect of the
     Company's remaining debt of $2,750,000, which continues to be guaranteed by
     the Company and its subsidiaries, including Aviva America, Inc., a wholly
     owned subsidiary, which owns working interests in oil and gas properties at
     Main Pass Block 41 and Breton Sound Block 31 fields, offshore Louisiana.
     Such remaining debt accrues interest at 10% per annum, compounded annually,
     and is due and payable on December 31, 2001. The remaining debt, however,
     may be converted by the Company, under certain circumstances, into a 15%
     net profits interest payable to Crosby in any new production at Breton
     Sound Block 31 field.

     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 $4,680,000 on the extinguishment of the debt.

     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 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.   Property and Equipment

     Internal general and administrative costs directly associated with oil and
     gas property acquisition, exploration and development activities have been
     capitalized in accordance with the accounting policies of the Company. Such
     costs totaled $29,000 for the six months ended June 30, 2000 and $18,000
     for the six months ended June 30, 1999.

     Unevaluated oil and gas properties totaling $268,000 and $553,000 at June
     30, 2000 and December 31, 1999, respectively, have been excluded from costs
     subject to depletion. The Company capitalized interest costs of $30,000 and
     $24,000 for the six-month periods ended June 30, 2000 and 1999,
     respectively, on these properties.

4.   Long Term Debt

     On October 28, 1998, concurrently with the consummation of the merger with
     Garnet Resources Corporation ("Garnet Merger"), Neo Energy, Inc., an
     indirect subsidiary of the Company, and the Company entered into a Restated
     Credit Agreement with ING (U.S.) Capital Corporation ("ING Capital"). ING
     Capital, Chase Bank of Texas, N.A. ("Chase") and the U.S. Overseas Private
     Investment Corporation ("OPIC") also entered into a Joint Finance and
     Intercreditor Agreement (the "Intercreditor Agreement") with the Company.
     ING Capital agreed to loan Neo Energy, Inc. an additional $800,000,
     bringing the total outstanding balance due ING Capital to $9,000,000. The
     outstanding balance due to Chase was paid down to $6,000,000 from the
     $6,350,000 balance owed by Garnet prior to the merger.

                                       7
<PAGE>

                     AVIVA PETROLEUM INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                            (unaudited) (continued)

     The Chase loan was unconditionally guaranteed by OPIC. On September 1,
     1999, the Chase loan was assigned and transferred to OPIC pursuant to this
     guarantee.

     The ING Capital loan and the OPIC loan (the "Bank Credit Facilities") were
     guaranteed by the Company and its material domestic subsidiaries. Both
     loans were also secured by the Company's consolidated interest in the
     Santana contract and related assets in Colombia, a first mortgage on the
     United States oil and gas properties of the Company and its subsidiaries, a
     lien on accounts receivable of the Company and its subsidiaries, and a
     pledge of the capital stock of the Company's subsidiaries.

     Borrowings under the ING Capital loan were subject to interest at the prime
     rate (as defined in the Restated Credit Agreement) plus 3% per annum.
     Borrowings under the OPIC loan were subject to interest at 10.27% per
     annum.

     Borrowings under the Bank Credit Facilities were payable as follows:
     $5,700,000 in April 1999, and thereafter $281,250 per month until final
     maturity on December 31, 2001. The terms of the Bank Credit Facilities,
     among other things, prohibited the Company from merging with another
     company or paying dividends, limited additional indebtedness, general and
     administrative expense, sales of assets and investments and required the
     maintenance of certain minimum financial ratios.

     The Company was also required to maintain an escrow account pursuant to the
     Bank Credit Facilities. As of March 31, 1999 and thereafter, the escrow
     account was to contain the total of the following for the next succeeding
     three-month period: (i) the amount of the minimum monthly principal
     payments (as defined in the loan documents), plus (ii) the interest
     payments due on the combined loans, plus (iii) the amount of all fees due
     under the loan documents and under the Intercreditor Agreement.

     On May 1, 2000, ING Capital and OPIC sold their entire interests in the
     Bank Credit Facilities to Crosby Capital LLC. As more fully described in
     note 2, this debt was restructured on June 8, 2000. The remaining balance
     of $2,750,000 is due on December 31, 2001, and accrues interest at 10% per
     annum, compounded annually. The remaining debt, however, may be converted
     by the Company, under certain circumstances, into a 15% net profits
     interest payable to Crosby in any new production at Breton Sound Block 31
     field.

5.   Interest and Other Income (Expense)

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

                                              Six Months Ended
                                                  June 30,
                                                 2000   1999
                                                -----  -----
       Interest income                          $  54  $  48
       Foreign currency exchange gain (loss)       10    118
       Other, net                                  38     11
                                                -----  -----
                                                $ 102  $ 177
                                                =====  =====

                                       8
<PAGE>

                     AVIVA PETROLEUM INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                            (unaudited) (continued)

6.   Commitments and Contingencies

     The Company is engaged in ongoing operations on the Santana contract in
     Colombia. The contract obligations have been met; however, the Company
     plans to recomplete certain existing wells and engage in various other
     projects. The Company's share of the estimated future costs of these
     activities is approximately $100,000 at June 30, 2000.

     The Company expects to fund these activities using existing cash and cash
     provided from operations. Risks that could adversely affect funding of such
     activities include, among others, 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 cash flow
     projections may be required.

     On August 3, 1998, leftist Colombian guerrillas inflicted significant
     damage on the Company's oil processing and storage facilities at the Mary
     field, and to a lesser extent, at the Linda facilities. Since that time the
     Company 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
     the Company's 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. There can be no assurance that such
     coverage will remain available or affordable.

     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. For additional
     discussions on the applicability of environmental laws and regulations and
     other risks that may affect the Company's operations, see the Company's
     latest annual report on Form 10-K.

                                       9
<PAGE>

                     AVIVA PETROLEUM INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                            (unaudited) (continued)

     The Company is involved in certain litigation involving its oil and gas
     activities, but unrelated to environmental contamination issues. 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.

7.   Segment Information

     The following is a summary of segment information of the Company as of and
     for the six-month periods ended June 30, 2000 and 1999 (in thousands):

                                                United
                                                States   Colombia    Total
                                                -------  ---------  -------
  2000
  ----
  Revenue:
   Oil and gas sales                            $  793     $3,520   $4,313
   Services fee                                     55         --       55
                                                ------     ------   ------
                                                   848      3,520    4,368
                                                ------     ------   ------

  Expense:
   Production                                      542      1,012    1,554
   Depreciation, depletion and amortization         63        334      397
   General and administrative                      549         35      584
   Recovery of losses on accounts receivable      (110)        --     (110)
                                                ------     ------   ------
                                                 1,044      1,381    2,425
                                                ------     ------   ------

  Gain on transfer of partnership interests         --      3,452    3,452
  Interest and other income (expense), net         (13)       115      102
  Interest expense                                (190)      (494)    (684)
                                                ------     ------   ------

  Earnings (loss) before income taxes and
     extraordinary item                           (399)     5,212    4,813

  Income taxes                                      --        193      193
                                                ------     ------   ------

  Earnings (loss) before extraordinary
     item                                         (399)     5,019    4,620

  Extraordinary item - gain on
     extinguishment of debt                         --      4,680    4,680
                                                ------     ------   ------

  Net earnings (loss)                           $ (399)    $9,699   $9,300
                                                ======     ======   ======

  Total assets                                  $2,188     $1,597   $3,785
                                                ======     ======   ======

                                       10
<PAGE>

                     AVIVA PETROLEUM INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                            (unaudited) (continued)

                                                United
                                                States   Colombia   Total
                                                -------  ---------  ---------
  1999
  ----
  Oil and gas sales                             $  427     $2,332   $2,759
                                                ------     ------   ------

  Expense:
   Production                                      603      1,176    1,779
   Depreciation, depletion and amortization         73        547      620
   General and administrative                      638         41      679
   Recovery of losses on accounts receivable       (92)        --      (92)
   Severance                                        --         62       62
                                                ------     ------   ------
                                                 1,222      1,826    3,048
                                                ------     ------   ------

  Interest and other income (expense), net         117         60      177
  Interest expense                                (158)      (416)    (574)
                                                ------     ------   ------

  Earnings (loss) before income taxes             (836)       150     (686)

  Income taxes                                      --        127      127
                                                ------     ------   ------

  Net earnings (loss)                           $ (836)    $   23   $ (813)
                                                ======     ======   ======

  Total assets                                  $1,497     $7,066   $8,563
                                                ======     ======   ======



8.   Subsequent Event

     On July 21, 2000, Aviva America, Inc. ("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. The Company cannot
     predict with any degree of certainty the amount, if any, of recorded
     liabilities that may be reduced or dismissed in connection with this
     proceeding.

                                       11
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
-------------------------------------------------------------------------------
of Operations.
--------------

Results of Operations
---------------------

Three Months Ended June 30, 2000 compared to Three Months Ended June 30, 1999
-----------------------------------------------------------------------------

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

       Revenue - 1999          $167      $ 23     $1,385    $1,575

       Volume variance           38       (11)      (597)     (570)
       Price variance           166        15        588       769

       Other                     --        (2)        --        (2)
                               ----      ----     ------    ------

       Revenue - 2000          $371      $ 25     $1,376    $1,772
                               ====      ====     ======    ======

Colombian oil volumes were 54,000 barrels in the second quarter of 2000, a
decrease of 41,000 barrels as compared to the second quarter of 1999. Such
decrease is due to an 18,000 barrel decrease resulting from the transfer of
partnership interests to Crosby and a 23,000 barrel decrease resulting from
normal production declines.

U.S. oil volumes were 13,000 barrels in 2000, up approximately 2,000 barrels
from 1999.  U.S. gas volumes before gas balancing adjustments were 6,000
thousand cubic feet (MCF) in 2000, slightly lower than 1999.

Colombian oil prices averaged $25.42 per barrel during the second quarter of
2000.  The average price for the same period of 1999 was $14.56 per barrel.  The
Company's average U.S. oil price increased to $27.49 per barrel in 2000, up from
$15.19 per barrel in 1999.  In 2000 prices have been higher than in the second
quarter of 1999 due to a dramatic increase in world oil prices.  U.S. gas prices
averaged $3.56 per MCF in 2000 compared to $2.41 per MCF in 1999.

A services fee of $55,000 for administering the Colombian assets was received
for the first month of the Service Agreement (see note 2 of the condensed
consolidated financial statements included elsewhere herein).  This amount is
net of Aviva Overseas' 22.1196% share of the fee.

Operating costs decreased approximately 15%, or $135,000, primarily due to lower
Colombian pipeline transportation costs resulting from lower volumes of oil
produced.

Depreciation, depletion and amortization ("DD&A") decreased by 43%, or $122,000,
primarily due to a decrease in the volume of Colombian oil produced.

General and administrative ("G&A") expense decreased $37,000 mainly as a result
of lower public ownership costs relating to the London Stock Exchange and lower
fees paid to consultants.

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 in
Argosy Energy International and a $4,680,000 extraordinary gain on the
extinguishment of a portion of the debt.  For a more detailed

                                       12
<PAGE>

explanation of the transaction, see note 2 of the condensed consolidated
financial statements included elsewhere herein.

The Company incurred severance expense of $62,000 during the second quarter of
1999 relating to cost cutting measures in Colombia following the merger with
Garnet Resources Corporation.  No such expenses were incurred during 2000.

Interest and other income decreased $146,000 primarily due to a foreign currency
exchange gain of $107,000 in 1999.  During the second quarter of 2000, the
foreign currency exchange gain was only $8,000.

Six Months Ended June 30, 2000 compared to Six Months Ended June 30, 1999
-------------------------------------------------------------------------

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

       Revenue - 1999          $ 335     $  92    $2,332    $ 2,759

       Volume variance             2       (66)     (799)      (863)

       Price variance            412        21     1,987      2,420

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

       Revenue - 2000          $ 749     $  44    $3,520    $ 4,313
                               =====     =====    ======    =======

Colombian oil volumes were 130,000 barrels in the first half of 2000, a decrease
of 68,000 barrels as compared to the first half of 1999.  Such decrease is due
to an 18,000 barrel decrease resulting from the transfer of partnership
interests to Crosby and a 50,000 barrel decrease resulting from production
declines.

U.S. oil volumes were 27,000 barrels in 2000, approximately the same as 1999.
U.S. gas volumes before gas balancing adjustments were 13,000 MCF in 2000, down
29,000 MCF from 1999.  Such decrease is due to a significant decline in
production from the Main Pass 41 field which may be approaching the end of its
economic life.

Colombian oil prices averaged $27.00 per barrel during the first half of 2000.
The average price for the same period of 1999 was $11.76 per barrel.  The
Company's average U.S. oil price increased to $27.56 per barrel in 2000, up from
$12.40 per barrel in 1999.  U.S. gas prices averaged $3.07 per MCF in 2000
compared to $1.86 per MCF in 1999.

A services fee of $55,000 for administering the Colombian assets was received
for the first month of the Service Agreement (see note 2 of the condensed
consolidated financial statements included elsewhere herein).  This amount is
net of Aviva Overseas' 22.1196% share of the fee.

Operating costs decreased approximately 13%, or $225,000, primarily due to lower
Colombian pipeline transportation costs resulting from lower volumes of oil
produced.

DD&A decreased by 36%, or $223,000, primarily due to a decrease in the volume of
Colombian oil produced.

                                       13
<PAGE>

G&A expense decreased $95,000 mainly as a result of lower public ownership costs
relating to the London Stock Exchange, lower fees paid to consultants and a
decrease in legal and accounting expenses.

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 in
Argosy Energy International and a $4,680,000 extraordinary gain on the
extinguishment of a portion of the debt.  For a more detailed explanation of the
transaction, see note 2 of the condensed consolidated financial statements
included elsewhere herein.

The Company incurred severance expense of $62,000 during the first half of 1999
related to cost cutting measures in Colombia following the merger with Garnet
Resources Corporation.  No such expenses were incurred during 2000.

Interest and other income decreased $75,000 primarily due to a foreign currency
exchange gain of $118,000 in 1999.  During the first half of 2000, the foreign
currency exchange gain was only $10,000.

Interest expense increased $110,000 in the first half of 2000, primarily as a
result of higher interest rates on long term debt.

Income taxes were $66,000 higher in 2000 principally as a result of higher
Colombian earnings.

New Accounting Pronouncements
-----------------------------

The Company is assessing the reporting and disclosure requirements of SFAS No.
133, Accounting for Derivative Instruments and Hedging Activities.  This
statement establishes accounting and reporting standards for derivative
instruments and hedging activities and will require the Company to recognize all
derivatives on its balance sheet at fair value.  If the derivative is a hedge,
depending on the nature of the hedge, changes in the fair value of the
derivatives will either be offset against the change in fair value of the hedged
item through earnings, or recognized in other comprehensive income until the
hedged item is recognized in earnings.  The Company expects to adopt SFAS No.
133, as amended, in the first quarter of fiscal 2001 and does not anticipate
that the adoption will have a material effect on the Company's results of
operations or financial position.

Liquidity and Capital Resources
-------------------------------

Cash and cash equivalents totaled $525,000 and $846,000 at June 30, 2000, and
December 31, 1999, respectively.  The decrease in cash and cash equivalents
resulted primarily from the surrender of $1,386,000 of cash balances in the
transfer of partnership interests in Argosy to Crosby, as described in note 2 of
the condensed consolidated financial statements and property additions of
$269,000.   Such decreases were partially offset by net cash provided by
operating activities.

Net cash provided by operating activities was $1,313,000 for the six months
ended June 30, 2000, compared to $(1,193,000) net cash used in operating
activities for the same period in 1999.  This improvement resulted primarily
from significantly higher oil prices during the 2000 period.

Although the Company surrendered significant partnership interests in Argosy in
connection with the aforementioned transaction with Crosby, the Company was able
to restructure its long term debt.  As a result of the transaction, the
Company's long term debt and accrued interest, which aggregated $16,103,064 at
May 31, 2000, was reduced to $2,750,000.  This remaining balance, due

                                       14
<PAGE>

December 31, 2001, is convertible by the Company, under certain circumstances,
into a 15% net profits interest payable to Crosby in any new production at
Breton Sound Block 31 field.

The Company's financial condition has improved as a result of the transaction
with Crosby, however, the Company's liabilities continue to exceed the carrying
amount of its consolidated assets.  This is also the case for Aviva America,
Inc. ("AAI"), a wholly owned subsidiary which holds the Company's interests in
oil and gas properties located offshore Louisiana.  Accordingly, on July 21,
2000, AAI filed a voluntary petition for reorganization under Chapter 11 of the
U.S. Bankruptcy Code.  The filing, in the Northern District of Texas, was
initiated in order to achieve a comprehensive restructuring of AAI's debts.
Management believes that a successful reorganization of AAI's debts will improve
the liquidity of AAI and the Company through the reduction or dismissal of
certain of AAI's debts.  Management, however, cannot predict with any degree of
certainty the amount, if any, of recorded liabilities that may be reduced or
dismissed in connection with this proceeding or the overall impact that it may
have on the Company.

With the exception of historical information, the matters discussed in this
quarterly report 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, 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 the Company's annual report on
Form 10-K.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk
-------------------------------------------------------------------

The Company is exposed to market risk from changes in interest rates on debt and
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.

PART II - OTHER INFORMATION

Item 6.  Exhibits and Reports on Form 8-K
-----------------------------------------

a)  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).

 **10.1  Service Agreement between Argosy Energy International and Aviva
         Overseas, Inc. dated as of June 1, 2000.

 **10.2  Letter Agreement dated June 8, 2000 between Crosby Capital, LLC and
         Aviva America, Inc.

                                       15
<PAGE>

 **10.3  Guaranty dated May 31, 2000 made by Aviva Overseas, Inc. in favor of
         Crosby Capital, LLC.

 **10.4  Assignment and Assumption Agreement dated June 1, 2000, between
         Crosby Capital, LLC and Neo Energy, Inc.

 **10.5  Assignment and Assumption Agreement dated June 1, 2000 between Crosby
         Acquisition LLC and Argosy Energy, Inc.

 **10.6  Assignment and Assumption Agreement dated June 1, 2000 between Crosby
         Capital, LLC and Garnet Resources Corp.

 **10.7  Assignment and Assumption Agreement dated June 1, 2000 between Crosby
         Capital, LLC and Aviva Overseas, Inc.

 **10.8  Assignment and Assumption Agreement dated June 1, 2000 between Argosy
         Energy, Incorporated and Crosby Acquisition, LLC.

 **10.9  Assignment and Assumption Agreement dated June 1, 2000 between Crosby
         Capital, LLC and Aviva Overseas, Inc.

 **10.10 Pledge Agreement dated May 31, 2000 executed by Aviva Overseas, Inc.
         (Debtor) in favor of Crosby Capital, LLC (Secured Party).

 **10.11 Third Amendment to Second Amended and Restated Limited Partnership
         Agreement of Argosy Energy International dated May 31, 2000.

 **10.12 Fourth Amendment to Second Amended and Restated Limited Partnership
         Agreement of Argosy Energy International dated June 1, 2000.

 **10.13 Assignment of Stock Warrant Rights dated May 31, 2000 executed by
         Crosby Capital, LLC in favor of Aviva Petroleum Inc.

 **27.1  Financial Data Schedule.


-----------------------------------------
 *  Previously filed
 **  Filed herewith



b)  Reports on Form 8-K
-----------------------

The Company filed the following Current Reports on Form 8-K during and
subsequent to the end of the second quarter:

Date of 8-K         Description of 8-K
-----------         ------------------

June 8, 2000        The registrant filed a report concerning the restructuring
                    of its long term debt and the transfer of partnership
                    interests in Argosy Energy International to the senior
                    secured lender.

                                       16
<PAGE>

                                   SIGNATURES
                                   ----------

Pursuant to the requirements 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.



Date:  August 11, 2000              /s/ RONALD SUTTILL
                                    ------------------
                                    Ronald Suttill
                                    President and Chief Executive Officer



                                    /s/  JAMES L. BUSBY
                                    -------------------
                                    James L. Busby
                                    Secretary, Treasurer and Chief Financial
                                    Officer
                                    (Principal Financial and Accounting Officer)

                                       17
<PAGE>

                               INDEX TO EXHIBITS

Exhibit
Number   Description of Exhibit
------   ----------------------

 *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).

**10.1   Service Agreement between Argosy Energy International and Aviva
         Overseas, Inc. dated as of June 1, 2000.

**10.2   Letter Agreement dated June 8, 2000 between Crosby Capital, LLC and
         Aviva America, Inc.

**10.3   Guaranty dated May 31, 2000 made by Aviva Overseas, Inc. in favor of
         Crosby Capital, LLC.

**10.4   Assignment and Assumption Agreement dated June 1, 2000, between
         Crosby Capital, LLC and Neo Energy, Inc.

**10.5   Assignment and Assumption Agreement dated June 1, 2000 between Crosby
         Acquisition LLC and Argosy Energy, Inc.

**10.6   Assignment and Assumption Agreement dated June 1, 2000 between Crosby
         Capital, LLC and Garnet Resources Corp.

**10.7   Assignment and Assumption Agreement dated June 1, 2000 between Crosby
         Capital, LLC and Aviva Overseas, Inc.

**10.8   Assignment and Assumption Agreement dated June 1, 2000 between Argosy
         Energy, Incorporated and Crosby Acquisition, LLC.

**10.9   Assignment and Assumption Agreement dated June 1, 2000 between Crosby
         Capital, LLC and Aviva Overseas, Inc.

**10.10  Pledge Agreement dated May 31, 2000 executed by Aviva Overseas, Inc.
         (Debtor) in favor of Crosby Capital, LLC (Secured Party).

**10.11  Third Amendment to Second Amended and Restated Limited Partnership
         Agreement of Argosy Energy International dated May 31, 2000.

**10.12  Fourth Amendment to Second Amended and Restated Limited Partnership
         Agreement of Argosy Energy International dated June 1, 2000.

**10.13  Assignment of Stock Warrant Rights dated May 31, 2000 executed by
         Crosby Capital, LLC in favor of Aviva Petroleum Inc.

**27.1  Financial Data Schedule.


-----------------------------------------
 *  Previously filed
 **  Filed herewith

                                       18