Buyer Requests Extension for Oilsands Quest's Wallace Creek Assets

Oilsands Quest announced that the potential purchaser of the Wallace Creek assets has requested an extension of the planned timeline to complete its due diligence and financing arrangements. Oilsands Quest may therefore extend the termination date for finalizing the definitive Purchase and Sale Agreement to January 31, 2012, subject to the potential purchaser agreeing to certain conditions. Negotiations are proceeding between Oilsands Quest and the potential purchaser on the terms for such an extension.

Oilsands Quest intends to determine whether a mutually-agreeable extension of the sale process is possible by the end of November 2011. OQI will then make a further announcement as to whether such an extension has occurred, and, if not, on next steps for the Company.

There can be no assurance that the Purchase and Sale Agreement (or subsequent definitive agreements) will be signed. Oilsands Quest currently has sufficient liquidity to continue operating through the end of January 2012. Absent the ability to obtain additional financing through the proposed Wallace Creek transaction or other sources of financing, there is substantial doubt about the Company's ability to continue as a going concern subsequent to this date. The Company will monitor its cash flow requirements and continue to operate in a prudent manner to preserve cash while working towards financing alternatives or asset sales.