Clearwater West Project Update: AOS confirms economic relationship and development access in Ft. McMurray


    CALGARY, April 30 /CNW/ - Alberta Oilsands Inc. (the "Company" or "AOS")
is pleased to announce that it has initiated and entered into a strategic
economic relationship with the municipal Ft. McMurray Airport through its
governing body, the Fort McMurray Airport Commission (or "FMAC") by way of a
Memorandum of Understanding ("MOU"). An operational update on its Clearwater
West project is also included. This relationship and project update continues
the process of removing risks related to uncertainty of access and development
to AOS's Clearwater West project.
    The relationship between AOS and FMAC confirms the mutual understanding
and cooperation for the parties in respect of a proposed heavy oil project on
the Clearwater West property as well as in respect of the Ft. McMurray Airport
Commission (FMAC) redevelopment plans. This strategic economic relationship
provides AOS access to an three sections of land on the Clearwater West
project which contain in excess of 150 million barrels of bitumen resources
(all of which have been classified as "contingent resources") as assessed by
Ryder Scott in its June 1, 2008 NI 51-101 compliant evaluation. In exchange
for these access rights AOS, the operator of the development will grant a
gross overriding royalty on production from within a defined area of oil sands
rights together with four million common share purchase warrants in two
tranches to the FMAC, subject to regulatory approval. The warrants shall have
a weighted average strike price of $0.75 per common share and expire on the
first and second anniversary of the issue date.
    Canaccord Capital Corporation and Raymond James Ltd. are acting as
strategic advisors to AOS in connection with the above described transaction.
    Shabir Premji, AOS Executive Chairman remarked, "We are pleased to
continue to enhance this mutually beneficial partnership with FMAC which will
provide them with a direct interest in AOS's Clearwater West heavy oil project
in exchange for development access. This economic relationship aligns the
interest of FMAC and AOS in accessing the benefits arising from the
development of the Clearwater West project". Sally Warford, acting CEO for
FMAC commented, "We have had a very positive working relationship with Alberta
Oilsands Inc. over the last two drilling seasons and are pleased with the
economics of the partnership going forward".

    Operational Update

    Clearwater West Project Update

    AOS has successfully completed its fall and winter core drilling in the
Clearwater West project area. The project area has now been delineated with a
total of 22 core holes, equating to an average coring density of 9.8 cores per
section. Results of the past two seasons of coring continue to confirm high
quality reservoir and significantly large bitumen quantity.
    Extensive cap rock studies were done which comprised: fracture pressure
determination, long term vertical permeability test and mercury injection
capillary pressure test. The cap rock fracture pressure was determined using
Mini-Frac(R) on three depth intervals in the Clearwater shale formation. The
cap rock average fracture pressure was determined to be 2,700 kiloPascals (kPa
or 390psi) which is almost twice the project design steam injection pressure
of 1,440kPa (209psi). In other words, the pilot design steam injection
pressure will operate with a safety margin of 93%. Two core samples of the cap
rock were subjected to long term vertical permeability test with brine and
steam showing the cap rock to have excellent sealing properties. In these
tests, the cap rock vertical permeability was measured with prolonged exposure
to brine at room (20 Celsius) and elevated steam (235 Celsius) temperatures
for durations of 600 to 700 hours. Under both conditions, the cap rock's
vertical permeability was extremely low, in the order of 2 nano-Darcy. These
results exceed the ERCB requirements for cap rock (maximum permitted
permeability of 0.001 milli-Darcy).
    The 03-22-088-R08W4 well was drilled to a total depth of 310 meters which
identified water source and disposal zones (Devonian Beaverhill Lake,
Winnipegosis and Granite Wash formations).
    AOS acquired an electro-resistivity tomography (ERT) survey over the
Clearwater area in January 2009. The survey results show that the cap rock
shale layer over Clearwater West is thick, continuous and expansive, which
corroborates with the core hole data acquired over the past two seasons.
    All the core holes, cap rock tests and water source and disposal zones
and ERT survey results validates the Clearwater West enhanced SAGD project. A
Clearwater West pilot project application is expected to be submitted in 2009.

    Ft. McMurray Clearwater Property

    Alberta Oilsands Inc. owns a 100% working interest in 28 sections of oil
sands rights located southeast of Fort McMurray. The parcel spans 24
kilometres in the east-west direction and is in close proximity to many
services and infrastructure required to develop a low cost commercial oil
sands project. AOS has identified three separate project areas in the land
block: Clearwater West (Sections 21 & 22 Twp088-R08W4), Clearwater East
(Sections 18, 19 & 30 Twp088-R07W4) and Clearwater North (Sections 13, 25, 31
- 36, Twp088-R07W4). Ryder Scott has assigned 320 million barrels of
contingent resources and a NPV of $328 million at $80.00 WTI (June 1, 2008 and
July 1, 2008 evaluations) to a portion of the Clearwater areas based on
production commencing in early 2011. The Fort McMurray land parcel was
purchased at Alberta Crown land sales. The first producing pilot project is
expected to be located at Clearwater West on Section 22 Twp 88 R8W4. AOS
continues to see service costs decline in the current environment and together
with the current minimal change in Ryder Scotts forecasted oil price in the
years 2011-2015, AOS estimates only a marginal decline on the NPV economics of
it Clearwater West project.
    For further information as it relates to the above transaction and
project see the company website at:
    Alberta Oilsands Inc. is a technically driven high growth energy company
focused on and the creation of long term sustainable value through the
development and conversion of the company's oil sands resources to reserves
and by increasing production and cash flow on relevant conventional oil and
natural gas assets.
    Neither TSX Venture Exchange nor its Regulation Services Provider accepts
responsibility for the adequacy or accuracy of this release.

    Important Information Regarding the Disclosure of Resources

    There is no certainty that it will be commercially viable for the Company
to produce any portion of the resources detailed in this news release and the
estimated future net revenues and values contained in this news release do not
necessarily represent the market value of such resources. There are a number
of inherent risks and contingencies associated with oil sands development,
including commodity price fluctuations, project costs and those other risks
and contingencies discussed in more detail in the sections entitled "Oilsands
Developments Risks" and "Business Risks and Uncertainties" in the Company's
management discussion and analysis for the nine-months ended September 30,
2008 and the year ended December 31, 2008. See also "Forward-Looking
Statements and Information" below.
    "Contingent resources" are defined as those quantities of petroleum
estimated, as of a given date, to be potentially recoverable from known
accumulations using established technology or technology under development,
but which are not currently considered to be commercial recoverable due to one
or more contingencies. Contingencies may include factors such as economic,
legal, environmental, political and regulatory matters or a lack of markets.
Certain of these contingencies, as they apply to the Company, are discussed in
more detail under the headings "Disclosure of Resources" in the Company's
management discussion and analysis for the nine-months ended September 30,
2008 and the year ended December 31, 2008.
    "Resources" are quantities of petroleum that are estimated to exist
originally in naturally occurring accumulations, including the quantity of
petroleum that is estimated, as of a given date, to be contained in known
accumulations, prior to production, plus those estimated quantities in
accumulations yet to be discovered.
    Resources and contingent resources do not constitute, and should not be
confused with, reserves. No bitumen reserves have been recovered within any of
the Company's project areas and there is no assurance that any commercial oil
sands projects will be developed.
    Forward-Looking Statements and Information: This press release contains
certain forward-looking statements and information ("forward-looking
statements") within the meaning of such statements under applicable securities
law including management's assessment of the Company's properties, production
and prospects. Forward-looking statements are frequently characterized by
words such as "plan", "expect", "project", "intend", "believe", "anticipate",
"estimate", "may", "will", "potential", "proposed" and other similar words, or
statements that certain events or conditions "may" or "will" occur. In
particular, this news release contains forward-looking statements with respect
to: (i) the possible development (including the timing of such development) on
the Company's oilsands properties, including in respect of pilot projects and
further development in respect of its Fort-McMurray properties; (ii) the
results of such oilsands development and (iii) the ability of the Company to
enter into, and the final terms of, a subsequent agreement with FMAC to grant
the Company certain access and development rights. These statements are only
predictions. Forward-looking statements are based on the opinions and
estimates of management 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 projected in the
forward-looking statements. These factors include the risks and uncertainties
discussed in the Company's annual financial statements, management discussion
and analysis and annual information form for the year ended December 31, 2008
as well as the Company's management discussion and analysis for the
nine-months ended September 30, 2008, all of which are available at Readers are urged to review such risks and uncertainties in
their entirety. In addition, there can be no assurances that the Company will
be able to enter into a definitive agreement with FMAC on the terms proposed,
or at all, or that the Company will be able to obtain the required regulatory
approvals in respect thereof. The Company undertakes no obligation to update
such forward-looking statements or information if circumstances or
management's estimates or opinions should change, unless required by law.
    Statements relating to "resources" are deemed to be forward-looking
statements, as they involve the implied assessment, based on certain estimates
and assumptions, that the described resources exist in the quantities
predicted or estimated, and can be profitably produced in the future. See
"Important Information Regarding the Disclosure of Resources" above in this
news release.
    Barrels of oil equivalent ("boe") may be misleading, particularly if used
in isolation. A boe conversion ratio of 6 mcf:1 bbl is based on an energy
equivalency conversion method primarily applicable at the burner tip and does
not represent a value equivalency at the wellhead.

    The TSX Venture Exchange has not reviewed and does not accept
    responsibility for the adequacy and accuracy of this release.

    %SEDAR: 00020297E

For further information:

For further information: Alberta Oilsands Inc., Suite 2800, 350 - 7th
Avenue S.W., Calgary, Alberta, T2P 3N9; Shabir Premji, Executive Chairman, T:
(403) 232-3341, F: (403) 263-6702,; or Chad Dust,
Executive Vice President, Finance and Business Development, T: (403) 538-3191,
F: (403) 263-6702, Company website:

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