KCS Energy Provides Gulf Coast Drilling Update
|Thursday, July 08, 2004
KCS Energy announced results of 2004 Gulf Coast drilling activity.
Year to date, KCS has drilled eight exploration wells in the south Texas area, of which seven have been completed and one is currently awaiting completion operations. In addition, the Company has drilled seven development wells in south Texas and two development wells in other areas of the Gulf Coast region.
Significant well test information includes:
Coquat Field, Live Oak County - Three exploration wells have been drilled. Additional wells are anticipated later this year.
La Reforma Field, Hidalgo County - Two exploration wells have been drilled and an additional two to four wells are planned in 2004.
West Mission Valley Field, Victoria County - One exploration well and three development wells were drilled and one well was re-completed. An additional development well recently reached total depth in the adjacent East Marshall Field and should be on production later this month.
Hedging Program Update
KCS has continued to layer in additional hedges on oil and gas production. Since our press release on May 5, 2004, we have placed additional swaps on natural gas for the third quarter of 2004 for 8,370 MMBTU per day at an average price of $6.47 per MMBTU and crude oil swaps for 500 BOPD at a price of $39.70 per barrel. For 2005 the Company has added hedges on 500 BOPD at prices of $36.16, $35.22, $34.56 and $33.99 per barrel for the first through fourth quarters, respectively.
Commenting on the drilling results, William N. Hahne, President and Chief Operating Officer observed, "The South Texas drilling program compliments our exploitation programs in the Arklatex region with higher potential prospects. We are particularly pleased with the high success ratios we've experienced in the Gulf Coast where we've completed all 17 wells drilled."