DAUGHERTY RESOURCES, INC.DAUGHERTY RESOURCES, INC.

IPAAIPAAOil & Gas Investment SymposiumOil & Gas Investment Symposium

New YorkNew York

April 2004April 2004

www.ngas.com

(Nasdaq: NGAS)(Nasdaq: NGAS)

Nasdaq: NGAS

Company HistoryCompany History

Daugherty Resources, Inc. Daugherty Resources, Inc. (Nasdaq: NGAS)(Nasdaq: NGAS)– Nasdaq Listed Since 1993 Nasdaq Listed Since 1993 – Oil and Gas Producer Since 1984Oil and Gas Producer Since 1984– Principal gas production is in eastern KentuckyPrincipal gas production is in eastern Kentucky

Nasdaq: NGAS

What is Daugherty?What is Daugherty?

Appalachian Basin Gas ProducerAppalachian Basin Gas Producer 390 Oil and Gas Wells390 Oil and Gas Wells 31 BCFE of Proven Net Reserves31 BCFE of Proven Net Reserves 180,000 Acres180,000 Acres Two Natural Gas UtilitiesTwo Natural Gas Utilities 112 Miles of Gas Gathering Pipeline112 Miles of Gas Gathering Pipeline Gold Properties in AlaskaGold Properties in Alaska

Nasdaq: NGAS

Nasdaq: NGASNasdaq: NGAS

Current Trading RangeCurrent Trading Range $5.34 - $7.00$5.34 - $7.00

Average Volume (Yahoo)Average Volume (Yahoo) 440,000 shares per day440,000 shares per day

Market CapMarket Cap $75 Million$75 Million

Shares OutstandingShares Outstanding 12.8 Million12.8 Million

Nasdaq: NGAS

Balance SheetBalance Sheet

12/31/200312/31/2003 12/31/200212/31/2002

AssetsAssets $ 46,068,442$ 46,068,442 $ 19,711,033$ 19,711,033

LiabilitiesLiabilities 20,012,45420,012,454 13,424,93613,424,936

Stockholder’s EquityStockholder’s Equity $ 20,055,988$ 20,055,988 $ 6,286,097$ 6,286,097

Nasdaq: NGAS

RevenueRevenue

12/31/200312/31/2003 12/31/200212/31/2002

Gross RevenueGross Revenue $ 27,444,433$ 27,444,433 $ 8,404,643$ 8,404,643

Net IncomeNet Income $ 3,813,740$ 3,813,740 $ 634,950$ 634,950

Net Income Per Share Net Income Per Share (Basic) (Basic)

$ 0.47$ 0.47 $ 0.11$ 0.11

Nasdaq: NGAS

ManagementManagement

William S. Daugherty (Since 1984)William S. Daugherty (Since 1984)

President and CEOPresident and CEO– IPAA 2004 Board of DirectorsIPAA 2004 Board of Directors– Kentucky Governor’s Representative to the Kentucky Governor’s Representative to the

Interstate Oil and Gas Compact CommissionInterstate Oil and Gas Compact Commission– Past President of Kentucky Oil and Gas AssociationPast President of Kentucky Oil and Gas Association– Past President of Kentucky Independent Petroleum Past President of Kentucky Independent Petroleum

Producers AssociationProducers Association

Nasdaq: NGAS

Management Management (cont.)(cont.)

William G. Barr III (Since 1993)William G. Barr III (Since 1993)Vice President Acquisitions & Legal AffairsVice President Acquisitions & Legal Affairs– Law Degree with 29 Years of Combined Legal and Law Degree with 29 Years of Combined Legal and

Management ExperienceManagement Experience– Former President of 120 Employee Independent Oil & Former President of 120 Employee Independent Oil &

Gas ProducerGas Producer– Mineral Law Author, Lecturer and Past Adjunct Mineral Law Author, Lecturer and Past Adjunct

Professor at Chase Law SchoolProfessor at Chase Law School– Board of Trustees of the Energy & Mineral Law Board of Trustees of the Energy & Mineral Law

FoundationFoundation– Board of Directors and Legislative Chairman of Board of Directors and Legislative Chairman of

Kentucky Oil and Gas AssociationKentucky Oil and Gas Association

Nasdaq: NGAS

Management Management (cont.)(cont.)

D. Michael Wallen (Since 1995)D. Michael Wallen (Since 1995)Vice President Engineering and SecretaryVice President Engineering and Secretary– Former Director of Kentucky Division of Oil and Former Director of Kentucky Division of Oil and

Gas from 1988 to 1995Gas from 1988 to 1995– 24 Years Experience in Drilling and Production 24 Years Experience in Drilling and Production

Engineering in the Appalachian BasinEngineering in the Appalachian Basin– Immediate Past President of Kentucky Oil & Gas Immediate Past President of Kentucky Oil & Gas

AssociationAssociation– Past President of Society of Petroleum Engineers, Past President of Society of Petroleum Engineers,

East Kentucky SectionEast Kentucky Section

Nasdaq: NGAS

Management Management (cont.)(cont.)

Michael P. Windisch (Since 2002)Michael P. Windisch (Since 2002)

Chief Financial OfficerChief Financial Officer– PricewaterhouseCoopers LLP – Audit ManagerPricewaterhouseCoopers LLP – Audit Manager– Member of the American Institute of Certified Member of the American Institute of Certified

Public AccountantsPublic Accountants

Nasdaq: NGAS

Oil and Gas PartnershipsOil and Gas Partnerships

24 Partnerships Since 199624 Partnerships Since 1996 205 Wells Drilled205 Wells Drilled 100% Success Rate for our Partners100% Success Rate for our Partners 25.9% Annual Return Cash and Tax Savings25.9% Annual Return Cash and Tax Savings 10.2% Average Annual Cash Return10.2% Average Annual Cash Return Partners - High Net Worth Individuals and Partners - High Net Worth Individuals and

Industry PartnersIndustry Partners

Nasdaq: NGAS

Nature of Our Appalachian Gas WellsNature of Our Appalachian Gas Wells

High BTU Gas With Market PremiumHigh BTU Gas With Market Premium 25 Year Well Life25 Year Well Life Dry GasDry Gas No Water ProducedNo Water Produced Typical Well Reserve Range: 200-500 MmcfTypical Well Reserve Range: 200-500 Mmcf

Nasdaq: NGAS

What We Look ForWhat We Look For

Large Tracts (+5,000 Acres)Large Tracts (+5,000 Acres) Excellent GeologyExcellent Geology Nearby Proven ProductionNearby Proven Production Close to PipelineClose to Pipeline

Nasdaq: NGAS

Interstate Pipeline SystemInterstate Pipeline System

Nasdaq: NGAS

Big Sandy Oil and Gas FieldBig Sandy Oil and Gas Field

Southern Appalachian BasinSouthern Appalachian Basin Over 10,000 WellsOver 10,000 Wells Produced 2.5 TCF of Natural Gas Produced 2.5 TCF of Natural Gas

– – 250 Mmcf per Well250 Mmcf per Well

Daugherty Controls 180,000 AcresDaugherty Controls 180,000 Acres

Nasdaq: NGAS

Nasdaq: NGAS

Kay Jay ProspectKay Jay Prospect

23,000 Acres23,000 Acres 120 Successful Gas Wells120 Successful Gas Wells Gas TransportationGas Transportation

– – CNRCNR

– – Somerset/Texas EasternSomerset/Texas Eastern

60 Drilling Locations60 Drilling Locations

Nasdaq: NGAS

Nasdaq: NGAS

Fonde ProspectFonde Prospect

18,000 Acres18,000 Acres 21 Successful Gas Wells21 Successful Gas Wells Fault Thickened Devonian ShaleFault Thickened Devonian Shale Big Lime Stratigraphic TrapsBig Lime Stratigraphic Traps Gas TransportationGas Transportation

– – CNRCNR

Nasdaq: NGAS

Nasdaq: NGAS

Straight Creek ProspectStraight Creek Prospect

22,000 Acres22,000 Acres 80 Locations Currently Available80 Locations Currently Available Gas TransportationGas Transportation

– Delta EnergyDelta Energy– Duke EnergyDuke Energy

31 Gas Wells Drilled31 Gas Wells Drilled New 8” Pipeline Installed to Duke EnergyNew 8” Pipeline Installed to Duke Energy

Nasdaq: NGAS

Nasdaq: NGAS

Leatherwood ProjectLeatherwood Project

107,000 Acres107,000 Acres Up to 600 well locationsUp to 600 well locations Gas TransportationGas Transportation

– Kentucky-West Virginia PipelineKentucky-West Virginia Pipeline– Somerset / Texas EasternSomerset / Texas Eastern– Duke EnergyDuke Energy

25 Test program drilled25 Test program drilled

Nasdaq: NGAS

Nasdaq: NGAS

2003 Accomplishments2003 Accomplishments

Drilled 89 Gas Wells – 100% SuccessDrilled 89 Gas Wells – 100% Success Increased Proved Reserves 46%Increased Proved Reserves 46% Increased Profits to $3.8 Million ($0.47/share)Increased Profits to $3.8 Million ($0.47/share) Added 41 Miles of Gas Gathering SystemAdded 41 Miles of Gas Gathering System Reduced Secured Debt to $735,000Reduced Secured Debt to $735,000 Raised $22.7 Million in Partnership Drilling FundsRaised $22.7 Million in Partnership Drilling Funds Cash Flow from Operations Cash Flow from Operations –– $9.4 Million $9.4 Million

Nasdaq: NGAS

Plans for 2004Plans for 2004

Fund 140 Gas Wells in AppalachiaFund 140 Gas Wells in Appalachia Maintain 30% Interest in Each WellMaintain 30% Interest in Each Well Sponsor 2 Drilling ProgramsSponsor 2 Drilling Programs Increase Acreage Position to 200,000 AcresIncrease Acreage Position to 200,000 Acres Increase Pipeline HoldingsIncrease Pipeline Holdings Increase Reserves through AcquisitionsIncrease Reserves through Acquisitions

Nasdaq: NGAS

Why Own NGAS?Why Own NGAS?

Low Cost Natural Gas ProducerLow Cost Natural Gas Producer Excellent Drilling ProspectsExcellent Drilling Prospects Small Cap Company in Tremendous Growth Small Cap Company in Tremendous Growth

StageStage Excellent Balance Sheet and Financial Ratios Excellent Balance Sheet and Financial Ratios

(i.e., (i.e., Debt to EquityDebt to Equity)) Increasing Institutional OwnershipIncreasing Institutional Ownership Experienced Management TeamExperienced Management Team Niche Player in Appalachian BasinNiche Player in Appalachian Basin

Nasdaq: NGAS

DisclaimerDisclaimer

The above presentation does not constitute an offer or The above presentation does not constitute an offer or solicitation to sell or purchase any security and should only be solicitation to sell or purchase any security and should only be considered in conjunction with a prospectus describing in detail considered in conjunction with a prospectus describing in detail the risks and merits of any investment in any security offered of the risks and merits of any investment in any security offered of Daugherty Resources, Inc.Daugherty Resources, Inc.

The above may contain projections and forward looking The above may contain projections and forward looking statements or information based upon assumptions relative to statements or information based upon assumptions relative to the oil and gas industry. Except for historical and factual the oil and gas industry. Except for historical and factual information all projections and forward looking statements are information all projections and forward looking statements are based upon estimates by Daugherty Resources, Inc. and are based upon estimates by Daugherty Resources, Inc. and are subject to risks and uncertainties that may be beyond their subject to risks and uncertainties that may be beyond their control and may cause results that significantly differ from the control and may cause results that significantly differ from the forward-looking statements either expressed or implied.forward-looking statements either expressed or implied.

DAUGHERTY RESOURCES, INC.DAUGHERTY RESOURCES, INC.

IPAAIPAAOil & Gas Investment SymposiumOil & Gas Investment Symposium

New YorkNew York

April 2004April 2004

www.ngas.com

(Nasdaq: NGAS)(Nasdaq: NGAS)