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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                               AMENDMENT NO. 1 TO
                                   FORM 10-QSB

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
    OF 1934
                      FOR THE QUARTER ENDED MARCH 31, 2004

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF EXCHANGE ACT

                           COMMISSION FILE NO. 0-12185

                              NGAS RESOURCES, INC.
                      (FORMERLY DAUGHERTY RESOURCES, INC.)
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)


        PROVINCE OF BRITISH COLUMBIA              NOT APPLICABLE
       (STATE OR OTHER JURISDICTION OF           (I.R.S. EMPLOYER
       INCORPORATION OR ORGANIZATION)           IDENTIFICATION NO.)


       120 PROSPEROUS PLACE, SUITE 201
             LEXINGTON, KENTUCKY                    40509-1844
  (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)          (ZIP CODE)


       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (859) 263-3948


Transitional Small Business Disclosure Format. Yes [ ] No [X]


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         NGAS Resources, Inc., a British Columbia corporation formerly named
Daugherty Resources, Inc. (the "Company"), is amending Item 3 of its Quarterly
Report on Form 10-QSB for the first quarter of 2004 to read as follows:

ITEM 3. CONTROLS AND PROCEDURES

         Our management, with the participation or under the supervision of our
Chief Executive Officer and Chief Financial Officer, is responsible for
establishing and maintaining disclosure controls and procedures and internal
control over financial reporting for the Company in accordance with the
requirements of the Securities Exchange Act of 1934 (the "Exchange Act"). Our
disclosure controls and procedures are intended to provide a framework for
making sure that all information required to be disclosed in our current and
periodic reports under the Exchange Act is processed and publicly reported by us
within the prescribed time periods for our filing of those reports. Our internal
controls over financial reporting are designed to ensure the reliability of our
financial reporting and the preparation of our financial statements for external
purposes in accordance with generally accepted accounting principles. They
include policies and procedures for maintaining reasonably detailed records that
accurately and fairly reflect all our business transactions and dispositions of
assets, for ensuring that receipts and expenditures are made only in accordance
with management authorizations and for preventing or timely detecting any
unauthorized acquisition, use or disposition of our assets that could have a
material effect on our financial statements.

         Our Chief Executive Officer and Chief Financial Officer have evaluated
the effectiveness of the design and operation of our disclosure controls and
procedures and our internal control over financial reporting as of June 30,
2004. Based on their evaluation, they have concluded that our disclosure
controls and procedures are effective to ensure that material information about
our business and operations is recorded, processed, summarized and publicly
reported within the time period required under the Exchange Act. They have also
concluded that our internal controls over financial reporting are effective to
ensure the reliability of our financial reporting and the preparation of our
publicly reported financial statements in accordance with generally accepted
accounting principles. There were no changes in our controls or procedures
during the first quarter of 2004 that have materially affected or are reasonably
likely to materially affect our internal control of financial reporting.

                                   SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934,
the NGAS Resources, Inc. has duly caused this amendment to be signed on its
behalf by the undersigned thereunto duly authorized.

                                    NGAS RESOURCES, INC.


Date: July 15, 2004                 By:         /s/  William S. Daugherty
                                         ---------------------------------------
                                                  William S. Daugherty
                                                 Chief Executive Officer
                                                (Duly Authorized Officer)
                                              (Principal Executive Officer)