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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)