HOUSTON, Oct. 8 /PRNewswire/ -- KCS Energy, Inc. (NYSE: KCS) today
announced it has completed two producing property acquisitions in its core
South Texas area.
Provident City Acquisition
KCS and Shana Petroleum Company, a privately held company, purchased from
Shell Western E&P, Inc. and its subsidiaries certain working interests and
royalties in the Provident City and N.E. Provident City Fields located in
Lavaca and Colorado Counties, Texas. These fields contain 38 active wells
currently producing at a combined rate of 11.1 million cubic feet of gas per
day (MMCFPD) and 300 barrels of oil per day (BOPD) from the Wilcox, Yegua and
Miocene pay horizons. The fields are projected to have a remaining 25-year
producing life. Shana Petroleum, which will serve as operator of the
Provident City Field, has been operating in a segment of this field for the
past 12 years.
As a result of this purchase, KCS has acquired a 42.5% weighted average
working interest in 21 wells that are currently producing 7.9 MMCFPD and 200
BOPD and an 8.1% weighted average overriding royalty interest in 17 wells that
are currently producing 3.2 MMCFPD and 100 BOPD. The 16,000-acre Provident
City Field complex has numerous infill drilling locations which have been
identified by 3-D seismic. A number of the existing well bores also have
behind-pipe reserves that will be exploited as the current producing intervals
deplete. The Provident City Field is located within KCS' core South Texas
area and is an excellent strategic fit with the Company's ongoing drilling
programs in South Texas.
Cypress/Langham Creek Field Working Interest Acquisition
KCS also purchased from Quicksilver Resources, Inc. an additional 41.56%
working interest in the Josey Ranch #3-3 and #3-19 wells that are located in
the KCS-operated Cypress/Langham Creek Field, effective September 1, 1999.
The Josey Ranch #3-3 and #3-19 wells are currently producing at a combined
rate of 2.2 MMCFPD. Both wells have behind-pipe potential that the Company
intends to pursue immediately. KCS also plans additional development drilling
on its acreage in this field.
KCS Energy President and Chief Executive Officer James W. Christmas said,
"As communicated previously, KCS has been implementing two primary operational
strategies throughout 1999: First, the sale of non-core, scattered, high-cost
properties to allow a clearer, more efficient focus on the Company's core
areas, and secondly, directing our 1999 $60 million capital program into KCS'
core areas of technical expertise. We continue to be ahead of schedule on our
non-core asset sale targets set earlier this year. The acquisition of these
two producing properties, which will add immediately to production and provide
additional development opportunities, will complement the drilling and
exploitation activities that are ongoing within our core areas and are in line
with our $60 million capital budget."
KCS is an independent energy company engaged in the acquisition,
exploration and production of natural gas and crude oil with operations in the
Mid-Continent and Gulf Coast regions. The Company also purchases reserves
(priority rights to future delivery of reserves) through its Volumetric
Production Payment (VPP) program. For more information on KCS Energy, Inc.,
please visit the Company's web site at http://www.kcsenergy.com .
To receive KCS' latest news and other corporate developments via fax at no
cost, please call 1-800-PRO-INFO; use company code KCS. Or visit
http://www.frbinc.com .
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, fluctuations 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.
SOURCE KCS Energy, Inc.
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Related links:
http://www.kcsenergy.com
CONTACT:
Kathryn M. Kinnamon, VP, Treasurer and Acting
CFO of KCS Energy, Inc., 713-877-8006, or General, Marianne
Stewart, 212-661-8030, Analyst, Beth Lewis, 617-342-7003, or
Media, Claudine Cornelis, 212-661-8030, all of The Financial
Relations Board
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