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 Commences Gas Sales from Seventh New Well Drilled in 2005

Announces Commencement of 2006 Winter Drilling Program

FOR IMMEDIATE RELEASE:

DENVER, COLORADO, January 17, 2006. Aspen Exploration Corporation (OTCBB: ASPN.OB), with offices in Bakersfield, California, and Denver, Colorado, announced today the commencement of gas sales from the Kalfsbeek #1-13 well, located in the Sacramento Valley gas province of northern California.

The Kalfsbeek #1-13 well located in the Buckeye Gas Field, Colusa County, California, was drilled to a depth of 8,800 feet and encountered gas pay in several intervals in the Forbes formation. Several of these Forbes intervals were perforated and tested gas on a 1/4 inch choke at a flow rate of 2,909 MCFPD with a flowing tubing pressure of 2,005 psig. Gas sales commenced on January 13th at a flow rate of 1,750 MCFPD with a flowing tubing pressure of 2,500 psig. Aspen has a 30.625% operated working interest in this well.

Aspen has commenced the drilling of the Merrill #31-2 well, located in the Malton Black Butte Field, Tehama County, California. This well is being drilled as an acceleration well to Aspen’s Merrill #31-1 well, and is targeting the Kione formation at depths ranging from 2,000 feet to 2,450 feet. The Merrill #31-1 encountered approximately 200 feet of potential gas pay and is currently producing from just one of the numerous lower Forbes pay zones. It could take many years for these lower zones to be depleted before the shallow Kione formation (Merrill #31-2 target) is perforated. The Merrill #31-2 will also be evaluating future horizontal drilling targets.

Other wells planned for the “winter season” include the deepening of an existing well and the drilling of a horizontal underbalanced lateral in an existing well in the Denverton Creek Field in Solano County, the drilling of a horizontal underbalanced well in the West Grimes Field in Colusa County, and the drilling of a deep, high potential oil well in Kern County.

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Aspen drilled ten successful gas wells out of ten attempts in 2004 for a 100% success rate, and nine gas wells out of ten attempts in 2005. During the last 5 years, Aspen has participated in the drilling of 34 operated wells, 30 of which were completed as gas wells, and 4 dry holes which were plugged and abandoned, a success rate of 88%. Aspen currently operates 53 gas wells and has non-operated interests in 15 additional wells in the Sacramento Valley of northern California, and has an exciting drilling program planned for 2006. Gas prices in northern California (PG&E Citygate Price), which Aspen has been paid for its gas, have been in the range of $8.00 per MMBTU to $10.50 per MMBTU for the past three months.

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.OB. 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 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 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.