Is it possible to use past progressive tense with time preposition ago in a sentence: " I was just thinking about that 30 minutes ago" or would use simple past?
Yes, native English speakers say things like this all the time. In fact, I was just saying it yesterday.
I'm not sure there's much more to add to answer your question, so here are some examples:
I was just talking to her the other day about whether we should have a party for his birthday.
She was still writing furiously when the teacher called the end of the exam.
They were already traveling to Europe when they heard the news.