SOURCE: Aspen Exploration Corporation

July 28, 2005 12:04 ET

Aspen Exploration Successfully Drills Malton Black Butte Field Well

DENVER, CO -- (MARKET WIRE) -- July 28, 2005 -- Aspen Exploration Corporation (OTC BB: ASPN), with offices in Bakersfield, California, and Denver, Colorado, announced today an additional gas discovery in the Sacramento Valley gas province of northern California.

The Johnson Unit #11 well located in the Malton Black Butte Field, Tehama County, California, was drilled to a depth of 4,800 feet and encountered approximately 80 feet of potential gas pay in various intervals in the Forbes formation. Production casing was run based on favorable mud log and electric log responses. The well will be perforated and tested within the next couple of weeks. The rig will now be moving to Aspen's Merrill #31-1 well, also located in the Malton Black Butte Field. Aspen has a 31% operated working interest in the Johnson #11 and Merrill #31-1 wells. The depths of the productive formations range from 1,800 feet to 6,000 feet. This field has produced 140 BCF of gas to date. Aspen has now drilled 6 successful gas wells out of 8 attempts in this field. Aspen also acquired 4 producing gas wells and 1 saltwater disposal well in this field about 10 years ago. Several of these wells have been producing for over 30 years and have produced excellent gas reserves from these shallow depths.

The Johnson #11 was the second well that Aspen has drilled this year. The first well, the Sachreiter #1-33, was a wildcat drilled to a depth of 7,700 feet in Colusa County, California. This well had excellent mud log shows (2,000+ units) across the seismically defined Forbes anomaly, but the electric logs indicated the zone was wet and the well was plugged and abandoned.

Aspen expects to be keeping 1 or 2 rigs busy drilling the 8 remaining wells in its 2005 drilling program. Four of these wells will be in the West Grimes Gas field located in Colusa County, California. The wells in this field produce from multiple Forbes intervals ranging in depth from 6,000 feet to 8,500 feet and have produced over 80 BCF of gas to date since it was discovered in 1960 by other parties. Numerous wells in this immediate area have produced at very prolific flow rates (4,000 MCFPD), have yielded excellent per well reserves (3 to 4 BCF per well), and have long productive well lives. Several of the 10 producing wells that Aspen acquired in this field two years ago (see prior news releases) have been producing for 40 years. Aspen believes that several of these wells may have additional gas potential in behind-pipe zones which have not yet been perforated. Aspen drilled 4 gas wells out of 4 attempts in this field last year. These wells were drilled based on a recently acquired 10.5 square mile 3-D seismic program located over Aspen's 5,000 plus leased acres in this field. Ten additional excellent drilling prospects have been identified. Aspen has a 21% operated working interest in this field. Aspen's other 3 wells planned for 2005 will be located in the Winters (1) and Kirk Buckeye (2) gas fields. The actual timing and drilling of these wells will be contingent on permits and drilling rig availability.

Aspen drilled ten successful gas wells out of ten attempts in 2004 for a 100% success rate. "We believe that our strategy of focusing primarily on low-risk exploration activities has contributed to our success," said Robert A. Cohan, Aspen Exploration Corporation's Chief Executive Officer. "Aspen's increased cash flow coupled with the present inventory of prime drilling acreage provides a sound basis for Aspen's continued growth as a profitable and successful energy producer."

During the previous 4 years, Aspen participated in the drilling of 24 operated wells, 21 of which were completed as gas wells, and 3 dry holes which were plugged and abandoned, a success rate of 87.5%. Aspen currently operates 45 gas wells and has non-operated interests in 15 additional wells in the Sacramento Valley of northern California. Current spot gas prices (PG&E Citygate) are in excess of $6.50 per MMBtu. Aspen has also entered into fixed contracts for a portion (approximately 25%) of its gas, at fixed prices ranging from $8.40 to $8.43 per MMBtu for the five month period from November 2005 through March 2006. Aspen's summer hedge for the 6 month period ending September 30, 2005 was approximately $6.67 per MMBtu for 40% of Aspen's production. PG&E Citygate gross prices are currently $0.45 per MMBtu less than NYMEX gas prices.

Future news releases will keep shareholders informed of Aspen's continuing progress and drilling activity. Aspen's stock is quoted on the OTC Bulletin Board under the symbol ASPN. For more information concerning Aspen, contact Bob Cohan, President and CEO, in Aspen's Bakersfield office at (661) 831-4669. Aspen's web page can be found at


This news release contains information that is "forward-looking" in that it describes events and conditions which Aspen Exploration Corporation ("Aspen") reasonably expects to occur in the future. Expectations for the future performance of the business of Aspen are dependent upon a number of factors, and there can be no assurance that Aspen will achieve the results as contemplated herein and there can be no assurance that Aspen will be able to conduct its operations or production from its properties will continue as contemplated herein. Certain statements contained in this report using the terms "may," "expects to," and other terms denoting future possibilities, are forward-looking statements. The accuracy of these statements cannot be guaranteed as they are subject to a variety of risks which are beyond Aspen's ability to predict or control and which may cause actual results to differ materially from the projections or estimates contained herein. These risks include, but are not limited to: the possibility that the described operations (including any proposed exploration or development drilling) will not be completed on economic terms, if at all, or the estimates of reserves may not be accurate. The exploration for, and development and production of, oil and gas are enterprises attendant with high risk, including the risk of fluctuating prices for oil and natural gas, imports of petroleum products from other countries, the risks of not encountering adequate resources despite expending large sums of money, and the risk that test results and reserve estimates may not be accurate, notwithstanding appropriate precautions. Many of these risks are described herein and in Aspen's annual report on Form 10-KSB, and it is important that each person reviewing this report understand the significant risks attendant to the operations of Aspen. Aspen disclaims any obligation to update any forward-looking statement made herein.

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