ASPEN EXPLORATION CORPORATION

2050 S. Oneida St., Ste. 208

Denver, CO 80224-2426

Telephone: (303) 639-9860

Fax: (303) 639-9863

Email: aecorp2@qwest.net

Web Site: www.aspenexploration.com

ASPEN EXPLORATION REPORTS STRONG ANNUAL 2006 RESULTS

Net Income Increases 100% resulting in Diluted EPS of $0.40

FOR IMMEDIATE RELEASE:

DENVER, COLORADO, October 12, 2006. Aspen Exploration Corporation (OTCBB: ASPN), an energy company with offices in Bakersfield, California, and Denver, Colorado, announced today results for its fiscal year ended June 30,2006. For the fiscal year, the Company reported revenues of $5,979,000, an increase of 45%, as compared to the year-earlier period revenues of $4,127,000, and net after tax profit of $2,970,000, or $0.40 per diluted share compared to $1,487,000 a year earlier, or $0.22 per diluted share.

The Company reported higher revenues as a result of an increase in production volumes from recent gas discoveries and higher prevailing prices for natural gas. Gas production for the fiscal year ended June 30, 2006 averaged 1,843 MCF per day, an increase of 8% versus the same period in fiscal 2005. Net income before interest, depletion, depreciation and taxes increased 55% to $5,570,000, or $0.75 per diluted share, compared to $3,585,000, or $0.53 per diluted share for the prior twelve month period. The Company had pre-tax income of $4,007,000, or $0.54 per diluted share, compared to pre-tax income of $2,206,000, or $0.33 per diluted share, for the prior twelve month period.

Aspen’s stock is quoted on the OTC Bulletin Board under the symbol ASPN. For more information concerning oil and gas operations contact Bob Cohan, President and CEO, in Aspen’s Bakersfield office at (661) 831-4669. Aspen’s web page can be found at www.aspenexploration.com.

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DISCLAIMER

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 the Company’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 an 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.