Aspen Group Resources Corporation

Aspen Group Resources Corporation

November 02, 2005 08:17 ET

Aspen Commences Production And Updates Operations In Manitoba

CALGARY, ALBERTA--(CCNMatthews - Nov. 2, 2005) - Aspen Group Resources Corporation (TSX:ASR) ("Aspen" or the "Company") announced that it has successfully completed the initial drilling program in the Daly Field in Manitoba. The Company drilled three horizontal wells, each encountering four potential productive zones in the Lodgepole and Bakken formations. At this time construction and tie-in of the temporary surface gathering facilities for the two productive wells (the 16-10 and the (2) 16-10), consisting of two production tanks per well, have been completed as scheduled. Following construction of the temporary surface facilities, the wells were put into production using tubing pumps at a nominal cumulative rate of approximately 80-100 barrels of oil per day (bopd) and monitored to determine optimum pump size. Aspen's engineers are currently working to properly size the pumps to handle the high water volumes that are typical in the Daly field and increase production rates to a higher stabilized output level. During the monitoring process, production from the wells is being sold at Cromer referenced pricing (September 2005 price of Cnd.$75.05/bbl).

"We are pleased with the results to date in Manitoba," stated Robert Calentine, CEO of Aspen. "The Daly Field acreage offers Aspen a very compelling development opportunity. Utilizing horizontal drilling, we can explore up to four prospective zones from each surface location. Combined with the economic incentives Manitoba provides, the multiple drilling targets will provide Aspen the ability to grow its reserves and production through an efficient, concentrated drilling program."

Aspen owns a 50 percent working interest in the Manitoba leases through its Joint Venture Agreement (the "Joint Venture") with Westchester Resources Inc. (TSXV:WSR). Aspen is the operator. The Joint Venture currently holds the rights to 7 leases totaling approximately 2200 acres in the Daly Field. Consulting geologists estimate that the leases contain approximately 25 additional drill locations. Each surface location has the potential to accommodate up to four horizontal wells. The Joint Venture is consulting with Trimble Engineering Associates Ltd. to prepare a resource report estimating the productive potential of the wells, and a drilling program in order to further develop the acreage. In addition to the new production from the Daly Field, Aspen has net production of approximately 280 barrels of oil equivalents per day from its other properties in Western Canada.

A summary of each well is provided below.

16-10 Well

The 16-10 well (located on the 16-10-009-28W1M surface lease of well location 12-10) was drilled to measured depth of approximately 1600 meters. The horizontal portion was drilled in the Middle Daly zone of the Lodgepole formation. The well was swab tested over a four-hour period at a rate of 332 bopd and is expected to produce at a stabilized rate in excess of 100 bopd of 33 degree API medium crude.

10-30 Well

The 10-30 well, (located on the 10 - 30 - 009-28W1M surface lease of well location 15-30) was drilled to measured depth of approximately 1220 meters. The horizontal portion was drilled in the Middle Daly zone of the Lodgepole formation. During the drilling of the horizontal leg, the well encountered a fracture in the formation at approximately 995 meters. The fracture has caused higher than expected water inflow in the well during initial clean up. The well was shut-in for a period of 24 days and a second attempt to swab and test the well was undertaken. The well continued to produce predominately water and was shut-in. The Company is currently evaluating several options, including re-entering the well and drilling a second leg in the same zone or in one of the other three zones encountered in the vertical portion of the well bore.

(2) 16-10 Well

The (2) 16-10 well (located on the 16-10-9-28W1M surface lease of well location 14-11) features two horizontal legs drilled from a single vertical well. The first leg was drilled to measured depth of approximately 1684 meters. The second leg was then drilled to a measured depth of 1617 meters. Both legs were drilled in the Lodgepole formation. The additional leg is expected to provide more efficient drainage of the reservoir. The well was swab tested from the lateral junction of the first and second leg over a four-hour period at a rate of 184 bopd and is expected to produce at a stabilized rate of approximately 100 bopd of 33 degree API medium crude

Aspen Group Resources Corporation is an independent oil and natural gas producer engaged in the acquisition, exploration, production and development of oil and natural gas properties in North America. Aspen's shares trade on The Toronto Stock Exchange under the symbol "ASR".

Portions of this document include "forward-looking statements", which may be understood as any statement other than a statement of historical fact. These statements are based on managements' current expectations and are subject to uncertainty and changes in circumstances. Forward-looking statements may include, but are not limited to, statements concerning estimates of recoverable hydrocarbons, expected hydrocarbon prices, expected costs, statements relating to the continued advancement of the Aspen's projects and other statements which are not historical facts. In addition, there can be no assurance that the flow rate estimated herein can be maintained with the testing conducted. When used in this document, and in other published information of Aspen's, the words such as "could," "estimate," "expect," "intend," "may," "potential," "should," and similar expressions are indicative of a forward-looking statement. Although Aspen believes that their expectations reflected in the forward-looking statements are reasonable, the potential results suggested by such statements involve risk and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Forward-looking statements contained in this document are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and other applicable securities laws. Certain factors that can affect Aspen's ability to achieve projected results are described in Aspen's Annual Report and Form 20-F, and other reports filed by both companies with the applicable Canadian securities regulatory authorities and by Aspen with the US Securities and Exchange Commission. Factors that can affect the ability of Aspen to achieve projected results include, among others, production variances from expectations, uncertainties about estimates of reserves, volatility of oil and gas prices, the need to develop and replace reserves, the substantial capital expenditures required to fund operations, environmental risks, drilling and operating risks, risks related to exploratory and developmental drilling, competition, government regulation, the ability of Aspen to implement its business strategy, the potential that projects will experience technical and mechanical problems, geological conditions in the reservoir which may negatively impact levels of oil and gas production and changes in product prices and other risks not anticipated by Aspen or disclosed in published material of Aspen. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties.

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