Oilsands Quest expands land position by winning strategic bids in Saskatchewan land sale



    Amex:   BQI

    CALGARY, Aug. 21 /CNW/ - Oilsands Quest Inc. (Amex:   BQI) has expanded its
land position with the acquisition of five strategically located oil sands
exploration licences and one oil shale exploratory permit from the Province of
Saskatchewan's land sale of August 13, 2007. The company's successful bids
will significantly enhance its oil sands holdings in northwestern Saskatchewan
and oil shale holdings in the Pasquia Hills area of east-central Saskatchewan.
    The sale included lands offered in the first ever bid process for Crown
oil sands and oil shale rights in Saskatchewan. For Oilsands Quest, these are
its first oil sands exploration licences and oil shale permits acquired under
Saskatchewan's new regulations issued in May 2007. The company's existing oil
sands exploration permits were granted under the terms of The Oil Shale
Regulations, 1964 and these regulations, subject to minor amendments and
inflationary adjustments, will continue to apply to Oilsands Quest's existing
permit lands in the Province.
    A map showing Oilsands Quest's revised oil sands holdings in Saskatchewan
is posted with this news release on the company's web site
(www.oilsandsquest.com).

    Oil sands exploration licences

    Oilsands Quest acquired five of the six blocks of oil sands exploration
licences offered in the sale covering a total of 44,484 hectares (109,920
acres) for an aggregate cost of $2.25 million Cdn, plus annual rental of
$1.75 per hectare. The licences are for oil sands rights from the surface to
the top of the Devonian geologic formation for a term of five years. The
blocks of land are located in Townships 90 and 91, Ranges 21 to 26 West of the
3rd Meridian. All of the blocks are located south of the company's existing
exploration permits in Saskatchewan; two are on the Alberta border.

    Oil shale exploratory permit

    Oilsands Quest acquired one of the two oil shale exploratory permits in
the Pasquia Hills area offered in the sale, totalling 33,900.11 hectares
(83,769 acres), for a total work commitment of $301,568 during the first two
years of the permit. Thereafter, the minimum annual expenditure requirement is
$2.00 per hectare for the remaining term of the permits plus an annual rental
of $0.25 per hectare. Oilsands Quest's bid committed the highest amount of
eligible expenditures on the permit lands during the first two years of the
five-year permit. The permit is for oil shale rights from the surface to the
top of the Precambrian geologic formation and is located in Townships 44 and
45, Ranges 1 to 3 West of the 2nd Meridian.

    
    Total land position

    As a result of the August 13 land sale, Oilsands Quest's land holdings in
Saskatchewan and Alberta have increased substantially, as summarized below.

    -------------------------------------------------------------------------
                                         Saskatchewan           Alberta
    -------------------------------------------------------------------------
                                      Hectares    Acres   Hectares    Acres
    -------------------------------------------------------------------------
    Oil Sands
    -------------------------------------------------------------------------
    Exploration Permits(*)             205,595   508,026    27,136    67,053
    -------------------------------------------------------------------------
    Exploration Licences(*)             44,483   109,918         -         -
    -------------------------------------------------------------------------
    Lease (Eagles Nest)                      -         -     9,216    22,773
    -------------------------------------------------------------------------
    Totals                             250,078   617,944    36,352    89,826
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Oil Shale
    -------------------------------------------------------------------------
    Exploration Permits                198,155   489,640         -         -
    -------------------------------------------------------------------------

    (*) The oil sands exploration permits and exploration licences in
        Saskatchewan and Alberta are contiguous.
    

    About Oilsands Quest

    With the largest contiguous oil sands holdings in Canada, Oilsands Quest
Inc. is focused on aggressive exploration and the accelerated development of
potential multiple world-scale discoveries. The company is conducting
pre-commercialization studies for its first discovery, Axe Lake, leading the
development of Saskatchewan's emerging oil sands industry.
(www.oilsandsquest.com)

    Forward-Looking Information

    Except for statements of historical fact relating to the company, 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" and other
similar words, or statements that certain events or conditions "may" "will" or
"could" occur. 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 anticipated in the
forward-looking statements, which include but are not limited to risks
inherent in the oil sands industry, regulatory and economic risks, and risks
associated with the company's ability to implement its business plan. Oilsands
Quest Inc. 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 10KSB 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: General inquiries and retail investors, contact
Hedlin Lauder, Investor Relations Ltd., Toll Free 1-800-299-7823, Office (403)
232-6251, Email irinfo@hedlinlauder.com; Institutional investors, contact The
Buick Group, Toll Free 1-877-748-0914, Office (416) 915-0915, Email
jbuick@buickgroup.com

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