Oilsands Quest files 10-Q Quarterly Report, updates reservoir test program and independent resource evaluation process



    
    Axe Lake reservoir test program accelerates drilling of horizontal wells

    Amex:   BQI
    

    CALGARY, Sept. 10 /CNW/ - Oilsands Quest Inc. (AMEX:  BQI) announces that
its Form 10-Q Quarterly Report for the period ended July 31, 2008, was filed
September 9, 2008, and is available online at www.sec.gov and www.sedar.com.
The company also provides an update on its reservoir test program and
announces the commencement of an advanced evaluation of resource estimates.

    Axe Lake Discovery - Reservoir Test Program

    Oilsands Quest's reservoir test program is proceeding at an aggressive
pace at three sites within the Axe Lake Discovery in northwest Saskatchewan.
Building facilities and key equipment are now in place for Phase One of the
test program at Test Site 1, including power and steam generators, water
treatment handling equipment and process control facilities. The steam, water
and recovered fluid piping tie-ins at Test Site 1 are currently underway.
    "We are making excellent progress on our reservoir test program with all
the facilities and equipment coming smoothly into place," said Christopher H.
Hopkins, Chief Executive Officer of Oilsands Quest Inc. "We are accelerating
our horizontal well program as a result of timely regulatory approvals and
ongoing positive laboratory and simulation results. I am pleased with our
team's ability to achieve these program accomplishments in an aggressive time
frame."

    
    Test Site 1
    -----------
    
    Regulatory approval was received earlier than originally anticipated for
drilling and casing the horizontal test wells and the related observation
wells for Phase Two of the reservoir test program. As a result, we have
accelerated drilling the horizontal test wells for Phase Two of the program
and these wells will be drilled and cased prior to the injection of steam in
the vertical well test program (Phase One) which is expected to occur in
November 2008. This will accelerate the overall timing of Phase Two of the
reservoir test program and result in comprehensive reservoir monitoring
capabilities. Two successful water source wells have been drilled and are
expected to meet all of the planned water requirements.

    
    Test Sites 2 and 3
    ------------------
    
    At Test Site 2, preliminary engineering contracts have been awarded and
design work has commenced for surface test facility requirements. At Test Site
3, two vertical wells are being drilled to execute a short-term reservoir
heating program designed to capture critical reservoir properties in the
field.

    Independent evaluation to advance resource estimates

    One of the purposes of the reservoir test program is to generate
sufficient reservoir data to enable our independent reservoir evaluator to
estimate the quantities of recoverable and unrecoverable volumes underlying
our current estimates of discovered resources and undiscovered resources at
the Axe Lake and Raven Ridge Discoveries. McDaniel & Associates has been
engaged to conduct an independent evaluation which is intended to provide an
interim sub-classification of our discovered and undiscovered resources as
contingent and prospective resources on certain portions of the Axe Lake and
Raven Ridge Discoveries. Assuming the reservoir test program proceeds as
planned, the first interim sub-classification evaluation is expected to be
prepared by the end of December 2008.

    Clarification on NI 51-101 Filings included as part of Annual Form 10-K

    As referenced in our news release of June 30, 2008, our statement of oil
and gas information (and related annual filings under National Instrument
51-101) for the year ended April 30, 2008 was filed with the Securities and
Exchange Commission (at www.sec.gov) and the Canadian Securities
Administrators (at www.sedar.com) as part of our annual report on Form 10-K.
In order to clarify the coordinates of this filing in Canada, we advise that
persons wishing to review our Form 10-K online on SEDAR will find it under our
profile in the category "Annual Financial Statements".

    About Oilsands Quest Inc.

    Oilsands Quest Inc. (AMEX:  BQI) is applying its technical expertise to
develop multiple global-scale discoveries while aggressively exploring
Canada's largest contiguous oil sands land holding. The company is the
originator of Saskatchewan's emerging oil sands industry. More information is
available at www.oilsandsquest.com.

    Forward-looking information

    Except for statements of historical fact relating to Oilsands Quest Inc.,
this news release contains certain "forward-looking information" within the
meaning of applicable securities law. Forward-looking information is
frequently characterized by words such as "plan", "expect", "project",
"intend", "believe", "anticipate", "estimate", "potential", "prospective",
"develop" and other similar words, or statements that certain events or
conditions "may", "will", or "could" occur. Forward-looking statements such as
references to Oilsands Quest's drilling programs, exploration programs,
geophysical programs, reservoir testing and analysis program, and the timing
of such programs are based on the opinions and estimates of management and the
company's independent evaluators at the date the statements are made, and are
subject to a variety of risks and uncertainties and other factors that could
cause actual events or results to differ materially from those anticipated in
the forward-looking statements, which include, but are not limited to, risks
inherent in the oil sands industry, regulatory and economic risks, lack of
infrastructure in the region in which the company's resources are located, and
risks associated with the company's ability to implement its business plan.
There is no certainty that it will be commercially viable to produce any
portion of the company's oil sands resources. There are uncertainties inherent
in forward-looking information, including factors beyond Oilsands Quest's
control, and no assurance can be given that the programs will be completed on
time, on budget or at all. Oilsands Quest undertakes no obligation to update
forward-looking information if circumstances or management's estimates or
opinions should change, except as required by law. The reader is cautioned not
to place undue reliance on forward-looking statements. The risks and
uncertainties set forth above are not exhaustive. Readers should refer to
Oilsands Quest's current annual report on Form 10-K and other document
filings, which are available at www.sedar.com and at www.sec.gov for a
detailed discussion of these risks and uncertainties and details regarding the
location and extent of Oilsands Quest's land holdings.





For further information:

For further information: Paul K. O'Donoghue, MBA, Vice President,
Investor Relations and Corporate Planning, Oilsands Quest Inc., Email:
investorrelations@oilsandsquest.com, (403) 263-1623

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