8-K

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): January 12, 2006

KCS Energy, Inc.

(Exact name of registrant as specified in its charter)

Delaware	1-13781	22-2889587
(State or other jurisdiction of	(Commission File Number)	(IRS Employer
incorporation)		Identification No.)

5555 San Felipe Road, Suite 1200
Houston, Texas	77056
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (713) 877-8006

Not Applicable

(Former name or former address, if changed since last report.)

_______________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

Item 7.01 Regulation FD Disclosure.

On January 12, 2006, KCS Energy, Inc. (“KCS”) issued a press release announcing an initial 2006 capital budget, an increase to the 2005 capital budget and updated guidance for 2005 and preliminary guidance for 2006. A copy of the press release is filed as Exhibit 99.1 hereto and is incorporated herein by reference.

The press release contains forward-looking statements that involve a number of risks and uncertainties. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are delays and difficulties in developing currently owned properties, the failure of exploratory drilling to result in commercial wells, delays due to the limited availability of drilling equipment and personnel, fluctuation in oil and gas prices, general economic conditions and the risk factors detailed from time to time in KCS’ periodic reports filed with the Securities and Exchange Commission.

In accordance with General Instruction B.2 of Form 8-K, the information in Exhibit 99.1 attached hereto is being furnished and is not deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not otherwise subject to the liabilities of that section. Accordingly, the information in Exhibit 99.1 attached hereto will not be incorporated by reference into any filing made by KCS under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, unless specifically identified therein as being incorporated therein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit 99.1 Press Release, dated January 12, 2006.

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: January 17, 2006	By:	/s/ Frederick Dwyer
	Name:	Frederick Dwyer
	Title:	Vice President, Controller and Secretary

EXHIBIT INDEX

Exhibit	Description
99.1	Press Release, dated January 12, 2006.

EX-99.1

Exhibit 99.1

 

AT THE COMPANY	AT FINANCIAL RELATIONS BOARD
James W. Christmas	Marilynn Meek - - General Info (212) 827-3773
Chairman & CEO	Susan Garland – Analysts (212) 827-3775
William N. Hahne
President & COO
(713) 877-8006
FOR IMMEDIATE RELEASE:
January 12, 2006

KCS ENERGY, INC. ANNOUNCES 2006 CAPITAL BUDGET

HOUSTON, TX, January 12, 2006 -- KCS Energy, Inc. (NYSE: KCS) today announced an initial 2006 capital budget, which is expected to be funded from cash flow of $315 million, up 21% over the increased 2005 budget of $260 million. Although KCS will continue to pursue acquisitions in its core areas, acquisition capital is not included in the budget. KCS is also posting preliminary guidance for 2006 as follows:

	2005 Guidance	2006 Guidance
Net Production (Bcfe)	46-47	55-57
LOE ($/Mcfe)	.70-.72	.73-.77
Production and Other Taxes (% Revenue)	6%	6%
G&A ($/Mcfe)	.21-.24	.22-.26
Interest Expense ($MM)	18-19	21-24
Income Tax Rate (1)	38.5%	38.5%
Capital Expenditures (2)$MM)	260	315

⁽¹⁾ 94% Deferred in 2005 and 65-70% deferred in 2006

⁽²⁾ Excludes acquisitions

William N. Hahne, President and Chief Operating Officer, said “The focus of our 2006 capital program will be to drill at least 215 new wells, primarily in north Louisiana and south Texas. We are targeting more than 20% net production growth from the drilling program. We have historically been successful in completing over 90% of our wells and with today’s commodity prices the economics of these projects are compelling.”

The 2006 budget includes drilling in the following areas:

	Estimated
	Gross Wells
Elm Grove / Caspiana, N. Louisiana	75
Terryville, N. Louisiana	30
Joaquin & Talihina, E. Texas & Arkoma Basin	12
Sawyer Canyon, W. Texas	25
Other Mid-Continent	33
Gulf Coast, S. Texas & Mississippi Salt Basin	40
Total	215

Definitions

The following abbreviations are utilized herein:

Bcfe – Billion Cubic Feet of Natural Gas Equivalent

Mcfe – Thousand Cubic Feet of Natural Gas Equivalent

$MM – Million Dollars

This press release contains forward-looking statements that involve a number of risks and uncertainties. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are delays and difficulties in developing currently owned properties, the failure of exploratory drilling to result in commercial wells, delays due to the limited availability of drilling equipment and personnel, fluctuation in oil and gas prices, general economic conditions and the risk factors detailed from time to time in the Company’s periodic reports and registration statements filed with the Securities and Exchange Commission.

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

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5555 San Felipe, Suite 1200, Houston, TX 77056