-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UxqTmVmYyo2psvE/fbXGOYKH8wkrKpPmSfPDaeHOUtczIv2r1q40hG3og00xCcwT Apk+Yyjfd5sbIgM26TWfiA== 0000914317-03-003820.txt : 20031229 0000914317-03-003820.hdr.sgml : 20031225 20031229165542 ACCESSION NUMBER: 0000914317-03-003820 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20031219 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20031229 FILER: COMPANY DATA: COMPANY CONFORMED NAME: KCS ENERGY INC CENTRAL INDEX KEY: 0000832820 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 222889587 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13781 FILM NUMBER: 031075975 BUSINESS ADDRESS: STREET 1: 5555 SAN FELIPE ROAD CITY: HOUSTON STATE: TX ZIP: 77056 BUSINESS PHONE: 9086321770 FORMER COMPANY: FORMER CONFORMED NAME: KCS GROUP INC DATE OF NAME CHANGE: 19920310 8-K 1 form8k-kcs_56196.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): December 19, 2003 KCS ENERGY, INC. (Exact name of registrant as specified in its charter) Delaware 001-13781 22-2889587 (State or other jurisdiction of (Commission (I.R.S. Employer incorporation) File Number) Identification No.) 5555 San Felipe Road, Suite 1200 Houston, Texas 77056 (Address of principal executive offices) (Zip Code) (713)877-8006 Registrant's telephone number, including area code NOT APPLICABLE (Former name or former address, if changed since last report.) Item 5. Other Events. On December 19, 2003, KCS Energy, Inc. announced an increase in its 2004 capital expenditure budget to $105 million and provided an update on its hedging program. A copy of the press release announcing the hedging and increased capital budget for 2004 is attached as Exhibit 99.1 hereto and is incorporated by reference herein. KCS Energy, Inc. disclaims any duty to update the information contained or incorporated by reference in this report other than as required by the Securities Exchange Act of 1934, as amended. Item 7. Financial Statements and Exhibits. (c) Exhibits. Exhibit 99.1 KCS Energy, Inc. Press Release dated December 19, 2003 announcing the increased capital spending budget for 2004 and an update on its hedging program. 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 hereunto duly authorized. KCS Energy, Inc. Date: December 29, 2003 /s/ Frederick Dwyer ------------------------------ Frederick Dwyer Vice President, Controller and Secretary EXHIBIT INDEX Exhibit Description - ------- ----------- 99.1 KCS Energy, Inc. Press Release dated December 19, 2003 announcing the increased capital spending budget for 2004 and an update on its hedging program. EX-99.1 3 exhibit99-1.txt Exhibit 99.1 AT THE COMPANY AT FINANCIAL RELATIONS BOARD - -------------- -- ------------------------- James W. Christmas Marilynn Meek - General Info (212) 445-8451 Chairman and CEO Peter Seltzberg - Analyst Info (212) 445-8457 (713) 877-8006 FOR IMMEDIATE RELEASE: - ---------------------- KCS ENERGY, INC. ANNOUNCES INCREASED 2004 CAPITAL BUDGET -------------------------------------------------------- Provides Update on Hedging -------------------------- HOUSTON, TX, December 19, 2003 -- KCS Energy, Inc. (NYSE: KCS) announced today that following its recently completed public stock offering of 6,900,000 shares at an initial price of $8.00 per share in which it raised approximately $52 million, its Board has approved an increase in the previously announced 2004 capital budget to $105 million, up approximately 30% from 2003 projected capital expenditures. Current drilling planned for 2004 includes the following areas: Wells ----- Elm Grove Field 35-40 Joaquin Field 10-15 Talihina Field 6-10 Sawyer Canyon Field 10-20 Other Mid-Continent 15-19 Gulf Coast Development 10-13 Exploration 10-13 ----- Total 96-130 The Company also provided an update with respect to its hedging program, which consists of a series of transactions designed to limit exposure to downside price movements while continuing to allow significant participation in increasing prices. KCS' current hedge positions for 2004 are summarized in the following table.
Average Type Hedge Amount Price ---------- ------ ----- 1st Qtr. Natural Gas - -------- ----------- Swap 26,600 MMbtu/day $6.71 3 Way Collar 10,000 MMbtu/day $4.50/$8.50/$9.00 Crude Oil --------- Swap 914 BOPD $30.59 2ND Qtr. Natural Gas - -------- ----------- Swap 10,000 MMbtu/day $5.00 Collar 10,000 MMbtu/day $4.00/$6.81 Crude Oil ---------
Swap 500 BOPD $29.64 ---- -------- ------ 3RD Qtr. Natural Gas - -------- ----------- Swap 10,000 MMbtu/day $4.93 Collar 10,000 MMbtu/day $4.34 / $6.00 Crude Oil --------- Swap 100 BOPD $28.50 4TH Qtr. Natural Gas - -------- ----------- Collar 20,000 MMbtu/day $4.00/$7.52 Crude Oil --------- Swap 100 BOPD $28.50
The swaps effectively lock in a specific NYMEX price, while the cost free collars fix the stated floor price and allow participation up to the stated cap price. The three- way collars in the first quarter fix the stated floor price of $4.50 per MMbtu and allow the Company to retain all price upside, except for the portion of realized prices between $8.50 and $9.00. In addition to the above hedges, during 2004 the Company will deliver an average 14.1 MMcfed under the production payment sold in 2001, at an average price of approximately $4.05 per Mcfe. "Our new credit facility enables us to layer in hedges at high commodity prices without being exposed to the potential for margin calls should commodity prices continue to rise. 2003 was a breakout year for KCS; we had excellent drilling results and identified numerous new projects and confirmed a large inventory of drilling locations to develop over the next several years. Our drilling program in 2004 offers more of the same type of wells that worked so well this year" stated James W. Christmas, Chairman and CEO. Based on KCS continued drilling successes and current commodity prices, the Company expects that it will be able to fund its increased capital expenditure budget for 2004 primarily with internally generated funds. KCS is an independent energy company engaged in the acquisition, exploration, development and production of natural gas and crude oil with operations in the Mid-Continent and Gulf Coast regions. For more information on KCS Energy, Inc., please visit the Company's web site at http://www.kcsenergy.com ### -----END PRIVACY-ENHANCED MESSAGE-----