Oilsands Quest updates progress on Axe Lake reservoir test program

    Amex:   BQI

    CALGARY, June 6 /CNW/ - Oilsands Quest Inc. (Amex:   BQI) announces the
resumption of field activities associated with preparations for the reservoir
field test program at its Axe Lake Discovery in northwest Saskatchewan. Since
the end of the 2007/08 winter drilling program on March 26, 2008, most field
work has been suspended due to spring breakup. However, off-site work related
to the field test program has continued, and site workers have been returning
to the Base Camp since mid-May.
    At the present time, 45 construction crew personnel are on site preparing
Test Site 1 in order to accommodate construction of the test facilities.
Operations for Test Site 1 of the reservoir test program will include power
generation, steam generation, water processing and handling, fluid recovery
and treatment, and the injection of steam and/or hot water into the reservoir.
Equipment for these operations has been sourced from a variety of locations in
Canada and the United States. Oilsands Quest's operating and engineering
personnel recently traveled to Houston to conduct a factory approval test on
the steam generation and water treatment equipment.
    To date, six 1,000-barrel heated liquid storage tanks have been received
at Test Site 1, and two 1,000-barrel heated liquid storage tanks have been
delivered to both Test Sites 2 and 3. The preliminary engineering contracts
for the surface facilities for Test Site 2 have been awarded and design work
has commenced.
    The major equipment for steam generation, water treatment and power
generation is expected to arrive at the Test Site 1 over the next four to six
weeks; most of this equipment will be installed in all-season building
structures. Construction of these facilities is expected to be completed
approximately eight weeks after the arrival of the major equipment. At the
present time, initial steam injection into the reservoir at Test Site 1 is on
schedule to occur in late summer 2008.
    By the end of this month, Oilsands Quest expects to resume drilling of
the wells required for injection and monitoring at the three reservoir test
sites, including the remaining two of the six wells at Test Site 1 and wells
at Test Site 2 and 3 as appropriate.
    The company's Base Camp, which has in excess of 200 beds, remained
operational during spring breakup to accommodate personnel involved with the
field test program and ongoing baseline environmental studies.

    About Oilsands Quest

    Oilsands Quest Inc. (www.oilsandsquest.com) is aggressively exploring
Canada's largest holding of contiguous oil sands permits and licences, located
in Saskatchewan and Alberta, and developing Saskatchewan's first global-scale
oil sands discovery. It is leading the establishment of Saskatchewan's
emerging oil sands industry.

    Forward-looking information

    Except for statements of historical fact relating to Oilsands Quest, 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 such as references to Oilsands
Quest's reservoir field test program 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 that could cause actual events or results to differ
materially from those anticipated in the forward-looking statements. These
risks, uncertainties and other factors include, but are not limited to,
technical risks inherent in construction projects 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 Oilsands Quest's
ability to implement its business plan. There are uncertainties inherent in
forward-looking information, including factors beyond Oilsands Quest's
control, and no assurance can be given that the construction of the facilities
and the execution of the test program 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-KSB 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
BarnesMcInerney Inc., Toll Free 1-866-794-7288, Office (416) 371-0510, Email

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Oilsands Quest Inc.

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