March 19, 2004

News Release: Daugherty Resources (NGAS) 2003 Oil &Gas Reserves Increase 46%

DAUGHERTY RESOURCES, INC. (Nasdaq: NGAS) today announced the Company's total proved reserves at December 31, 2003, were 31,371 Mmcfe, up 9,854 Mmcfe, or 46%, from December 31, 2002. For the year ended December 31, 2003, the Company increased its net oil and gas production to 485.9 Mmcfe, up 51% from 321.6 Mmcfe in the prior year. Daugherty's standardized measure of discounted future net cash flows (discounted at 10%) increased 60.35% to $33.597 million as of December 31, 2003, compared to $20.952 million as of December 31, 2002. Although natural gas and oil prices increased 9.6% and 10.9% respectively, the increase in reserves is primarily the result of the Company's drilling activities. 'The past year has been a substantial growth period for our company,' commented William S. Daugherty, President and CEO. 'We were able to drill 89 gas wells during the 2003 year with a 100% success rate. We expect 2004 reserves to rise dramatically because of programs and the number of wells we plan to drill in 2004.'

Wright and Company, a petroleum engineering firm located in Houston and Nashville, has compiled the Company's reserves for the past six years. Listed below is a summary of the Company's reserves for the years ending December 31, 2003, 2002 and 2001.

                                                As of December 31,
     Estimated Proved Reserves:        2003            2002            2001

     Natural gas (Mcf)
      Proved developed            12,345,355        7,151,933        5,881,153
      Proved undeveloped          18,454,309       13,668,366        4,205,260

        Total                     30,799,664       20,820,299       10,086,413

     Crude oil (Bbl)
      Proved developed                85,253          106,106          123,196
      Proved undeveloped               9,992            9,992            9,572

         Total                        95,245          116,098          132,768

     Natural gas
      equivalents (Mcfe)          31,371,134       21,516,887       10,883,021

Daugherty Resources is a natural resources company focused on natural gas development drilling and reserve growth. Based in Lexington, Kentucky, the Company specializes on developing geological prospects concentrated in the Appalachian Basin. Additional information about the Company is available at its website, www.ngas.com .

This Release includes forward looking statements within the meaning of Section 21E of the Securities Exchange Act relating to matters such as anticipated operating and financial performance, business prospects, developments and results of the company. Actual performance, prospects, developments and results may differ materially from anticipated results due to economic conditions and other risks, uncertainties and circumstances partly or totally outside the control of the company, including risks of production variances from expectations, volatility of product prices, the level of capital expenditures required to fund drilling operations and the ability of the company to implement its business strategy. These and other risks are described in the company's periodic reports filed with the United States Securities and Exchange Commission.

SOURCE Daugherty Resources, Inc.

William S. Daugherty, President and CEO of Daugherty Resources, Inc., +1-859-263-3948, or fax, +1-859-263-4228, or e-mail, This email address is being protected from spambots. You need JavaScript enabled to view it. (NGAS)

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