This is a classic "pano" problem. The image bounds in your album are 960x720. So, jAlbum resizes that image to fit within those bounds, and it ends up being 960x43 pixels. Not really the effect you were after!
You could just set the image bounds for the entire album to something like 20000x720 pixels. Contrary to your intuition, this would not turn every image into a wide, short image, since the aspect ratio is never mangled. You might want to try this, since it usually causes no other problems.
The other approach is to set the image bounds just for that one image to something larger. In the main jAlbum Explore window, double-click to open that image for editing, then go to the Variables panel on the right, and enter new bounds as shown in the attached screenshot. This is, by the way, very case-sensitive, so make sure you get the variable names right!
I've done a quick test, and this seems to behave itself with Tiger and Turtle - no guarantees with any other skins.
Edit the panorama in the Jalbum explorer and enter MaxImageWidth 2000 in the variables section.
Note the spelling, upper/lowercase!
To check if you did it right: look at the image file size and/or dimensions produced in the slides directory of the album before and after you enter the variable. This works fine in Turtle and many more skins.