LONDON (AP) _ In 1992, BP Amoco was facing financial disaster.

Seven years later, it is the world's second largest oil company after announcing a $25.6 billion acquisition of Atlantic Richfield Co.

The key to the rise? Most industry observers would point to BP Amoco's single-minded chief executive, Sir John Browne.

Thursday, as Browne detailed plans for the combined company, he reveled in its producing power. The company is expected to produce 2.7 million barrels of oil a day, more than any other corporation.

But he said the deal was not motivated by the desire to be the biggest.

``Of course scale is not everything,'' he said at a news conference Thursday. ``We're very conscious that we have to work to ... counter the negative elements which size can bring.''

Browne, who became chief executive in 1995, was speaking from bitter experience. He helped manage the company seven years ago, when _ as British Petroleum Co. _ it was struggling to pay its bills after making several costly acquisitions and betting that oil prices were heading to $25 a barrel.

Instead, crude prices nose-dived to less than $15 a barrel, and BP found itself bloated with dangerously underperforming assets.

``One of the key defining moments was in mid-1992 when they nearly went bust,'' said Alan Sinclair, an analyst with Charterhouse Securities in London. ``They set about selling assets they didn't want and streamlining the business by applying an extremely focused approach on returns.''

That involved wrenching job cuts at the acquired businesses as Browne funneled his quest for efficiency into a near-obsession, analysts say.

By 1995, the company was leaner and back on track. Today, its return on average capital employed _ a measure of how efficiently a company uses its assets _ is one of the highest in the business, at 9.1 percent.

As BP's competitors began consolidating, Browne took his time before merging with Amoco Corp. That merger, completed in December, created the world's third-largest oil company and fueled Browne's cost-cutting reputation as he slashed 10,000 jobs to date.

The merger also gave the company's reputation a welcome makeover, analysts say. BP shed for good what Peter Hitchens, an analyst with Williams De Broe, called ``a pretty dull and boring image'' as it diversified beyond just oil exploration and production.

The Arco acquisition carries this evolution a big step further. The combined company now has 70 percent of its capital invested in upstream activities, 20 percent in downstream retail and marketing and 10 percent in petrochemicals.

``That is an ideal mix for an integrated oil company,'' Sinclair said.

It will also broaden BP Amoco's vast holdings, giving it operations ranging from natural gas fields in Indonesia to the biggest network of filling stations in California.

The BP Amoco-Arco combination still awaits approval by shareholders and regulators. If given the green light, it would become the second-biggest producer of oil and natural gas behind the still-to-be-approved Exxon-Mobil union.

Analysts give much of the credit for this turnaround to Browne, an opera-loving workaholic who was knighted by Queen Elizabeth II last year.

``John Browne is a visionary. The guy sets the pace,'' Sinclair said. ``I have not met a single individual that has such a good grasp of the industry they're involved in.''