EIN 36-1812780
Plan 053

BP AMERICA SAVINGS AND INVESTMENT PLAN

                   

STATEMENT OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS

FOR THE YEAR ENDED DECEMBER 31, 2001

(thousands of dollars)

The accompanying notes are an integral part of this statement.

BP AMERICA SAVINGS AND INVESTMENT PLAN

                   

NOTES TO FINANCIAL STATEMENTS

1.  DESCRIPTION OF PLAN

BP America Inc. (the "Company") established the BP America Savings and Investment Plan effective July 1, 1952 (the "Plan"). The Company is an indirect wholly owned subsidiary of BP p.l.c. ("BP").  Employees in participating collective bargaining units are eligible to participate in the Plan. Effective January 1, 2002, the Plan was amended to conform to recent changes in the Internal Revenue Code ("IRC") and the name was changed to BP Savings and Investment Plan.

The following brief description of the Plan is provided for general information only. Unless otherwise indicated, all descriptions in these notes relate to the Plan as it existed in 2001.  Participants should refer to the Plan document for more complete information. The Plan is a defined contribution plan, which is subject to and complies with the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). The Company reserves the right to amend or terminate the Plan at any time.

The purpose of the Plan is to encourage eligible employees to regularly save part of their earnings and to assist them in accumulating additional security for their retirement. The Plan provides that both participant contributions and Company matching contributions will be held in a trust by an independent trustee for the benefit of participating employees. Plan assets are held in the BP Master Trust for Employee Savings Plans (the "Master Trust").  The trustee of the Master Trust is State Street Bank and Trust Company.

Fidelity Investments Institutional Services Company, Inc. is the Plan's recordkeeper.  BP Corporation North America Inc. (an indirect wholly owned subsidiary of BP) is the Plan sponsor and the Senior Vice President of Human Resources is the Plan administrator. 

Under the Plan, participating employees may contribute up to a certain percentage of their qualified pay on a pre-tax and/or after-tax basis. Participants may elect to invest in four investment fund options as provided by the Plan. Participants may change the percentage they contribute and the investment direction of their contributions at any time throughout the year. 

The Company contributes quarterly to the Plan an amount equal to each participant's contribution up to 6% of base pay. Company contributions are made in investments which follow the participant investment direction. Participants may elect to sell any portion of their investment fund(s) and  reinvest the  proceeds in one or more of

BP AMERICA SAVINGS AND INVESTMENT PLAN

                   

NOTES TO FINANCIAL STATEMENTS (continued)

1.  DESCRIPTION OF PLAN (continued)

the other available investment alternatives. There are no restrictions on the number of transactions a participant may authorize during the year.

The benefit to which a participant is entitled is the benefit which can be provided by the participant's vested account balance.  Participants are fully vested in their participant contribution accounts. Vesting in Company matching contribution accounts is dependent upon specific criteria as described in the Plan document. Forfeitures of Company contributions by participants who withdrew from the Plan before vesting amounted to $0 and $15,000 for the years ended December 31, 2001 and 2000, respectively. The Plan uses forfeitures to pay certain administrative expenses and to reduce future Company contributions.

All reasonable and necessary Plan administrative expenses are paid out of the Master Trust or paid by the Company. Generally, fees and expenses related to investment management of each investment option are paid out of the respective funds.  As a result, the returns on those investments are net of the fees and expenses of the managers of those investment options and certain other brokerage commissions and other fees and expenses incurred in connection with those investment options.

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Method of Accounting.  The financial statements of the Plan are prepared under the accrual method of accounting.

Estimates.  The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires estimates and assumptions that affect certain reported amounts. Actual results may differ in some cases from the estimates.

Investment Valuation.  All investments of the Master Trust, except as noted below, are stated at fair value generally as determined by quoted closing market prices, if available. Investments in guaranteed investment contracts and synthetic guaranteed investment contracts are valued at contract value because they are fully benefit responsive.  The Master Trust's interest in the guaranteed investment contracts and synthetic guaranteed investment contracts with managed portfolio companies and insurance companies represents the maximum potential credit loss from concentrations of credit risk associated with its

BP AMERICA SAVINGS AND INVESTMENT PLAN

                   

NOTES TO FINANCIAL STATEMENTS (continued)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

investment in these contracts. Money market investments and loans to participants  are  valued  at  cost  which approximates fair value. Other investments for which no quoted market prices are available are valued at fair value as determined by the Trustee based on the advice of its investment consultants. 

New Accounting Standard. The Master Trust adopted the Financial Accounting Standards Board Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133") on January 1, 2001.  SFAS 133 requires the recognition of gains and losses associated with derivative instruments as a change in net assets in the period of change. The adoption of SFAS 133 did not have a material impact on the financial statements of the Plan or the Master Trust.

3. PARTICIPANT LOANS

Participants are eligible to borrow from their account balances in the Plan. Loans are made in the form of cash and the amount may not exceed the lesser of 50 percent of the market value of the total vested accounts or $50,000 less the highest loan balance outstanding during the preceding twelve months.  Interest rates are fixed for the duration of the loan and charged on the unpaid balance. The interest rate charged is one percent plus the prime rate reported in The Wall Street Journal on the last business day of the calendar quarter immediately preceding the calendar quarter in which the participant applies for the loan.  A processing fee of $35 is charged for each new loan. Repayment of loan principal and interest is generally made by payroll deductions and credited to the participant's accounts.

4. INCOME TAX STATUS

The Plan has received a determination letter from the Internal Revenue Service ("IRS") dated February 5, 1996, with respect to its qualified status under Section 401(a) of the IRC and, therefore, the related trust is exempt from taxation.  Once qualified, the Plan is required to operate in conformity with the IRC to maintain its qualification. The Plan has been amended since receiving the determination letter. However, the Plan administrator and the Company's tax counsel believe the Plan continues to meet the applicable tax qualification requirements of the IRC. The Plan sponsor reserves the right to make any amendments necessary to maintain the qualification of the Plan and trust. 

BP AMERICA SAVINGS AND INVESTMENT PLAN

                   

NOTES TO FINANCIAL STATEMENTS (continued)

5. MASTER TRUST

All investment assets of the Plan are held in the Master Trust with the assets of other BP sponsored savings plans.

The beneficial interest of the plans in the Master Trust is adjusted daily to reflect the effect of income collected and accrued, realized and unrealized gains and losses, contributions and withdrawals, and all other transactions. The  Master Trust constitutes a single investment account as defined in the master trust reporting and disclosure rules and regulations of the Department of Labor.

As of December 31, 2001 and December 31, 2000, the Plan's percentage interest in the Master Trust was 0.88% and 0.84%, respectively.  The net assets of the Master Trust as of December 31, 2001 and December 31, 2000, and changes in net assets of the Master Trust for the year ended December 31, 2001 are as follows:

NET ASSETS

(thousands of dollars)

BP AMERICA SAVINGS AND INVESTMENT PLAN

                   

NOTES TO FINANCIAL STATEMENTS (continued)

5.  MASTER TRUST (continued)

BP AMERICA SAVINGS AND INVESTMENT PLAN

                   

NOTES TO FINANCIAL STATEMENTS (continued)

5.  MASTER TRUST (continued)

As the result of BP becoming the operator for the Olympic Pipe Line Company, employees of Olympic Pipe Line had the option to keep their account balance in the Olympic Pipe Line Employee Savings Plan or to transfer their account balance to the BP Employee Savings Plan.  On October 1, 2001 net assets of $1.3 million were transferred to the BP Employee Savings Plan.

On May 2, 2001, BP acquired certain assets from the Exxon Mobil Corporation.  BP provided affected employees with the option to transfer their account balance into the BP Employee Savings Plan. In 2001, net assets totaling $.7 million were transferred to the BP Employee Savings Plan.

During 2001, BP sold two refineries and certain related assets to Tesoro Petroleum Corporation. As a result, net assets of $2.2 million were transferred from the BP Employee Savings Plan to a savings plan sponsored by Tesoro.

6.  SUBSEQUENT EVENT

Subsequent to December 31, 2001, the Senior Vice President of Human Resources, on behalf of BP Corporation North America Inc., approved the merger of the Plan into the BP Employee Savings Plan. The merger is schedule to take place on July 1, 2002.

BP AMERICA SAVINGS AND INVESTMENT PLAN

                   

EXHIBITS

Exhibit No.                Description

  23                       Consent of Independent Auditors