Oilsands Quest Acquires Acreage Near Axe Lake Discovery

Oilsands Quest Inc. has added four blocks of oil sands exploration permits in Alberta totaling 27, 136 hectares (67,053 acres) as the result of successful bids at recent Alberta land sales. The permits are located directly west and contiguous to Oilsands Quest's Axe Lake Discovery lands on its oil sands permits in Saskatchewan. The total consideration paid, which includes the permit rental costs for the first year, to the Alberta government for the permits purchased in the March 21, 2007 land sale was US$21,657,699 ($25,075,488 Cdn).

"We are extremely pleased with the successful conclusion of our bids," said Christopher H. Hopkins, President & Chief Executive Officer of Oilsands Quest. "In addition to what our drilling program is proving on our Axe Lake Discovery lands in Saskatchewan, seismic surveys that we conducted over lands on both sides of the Alberta/Saskatchewan border earlier this winter strongly supported the acquisition of these parcels."

    Results of Alberta Land Sale Announced March 21, 2007 ($ Cdn)

    Block  Description                                Total Ha(1)   Price/Ha

    P9039  North half of Township 92, Range 1,
           West of the 4th Meridian                     4,608       $1,085.10

    P9040  East half of Township 93 and 94,
           Range 1, West of the 4th Meridian            9,216       $1,193.00

    P9041  West half of Township 93 and 94,
           excluding sections 32 and 33, Range 1,
           West of the 4th Meridian                     8,704       $1,034.00

    (1)  One (1) Hectare (Ha) equals approximately 2.471 acres.

With the purchase of the north half of Township 92, Oilsands Quest now owns exploration permits for the whole township, as it had successfully bid on the south half of Township 92, Range 1, West of the 4th Meridian on August 9, 2006 (P0098 - 4,608 hectares).

The acquisition of the permits was funded by a line of credit from The Toronto-Dominion Bank pursuant to a Credit Agreement dated as of March 19, 2007. Oilsands Quest Sask Inc., the Company's subsidiary, is the borrower under the facility and the Company has provided a secured guarantee. The facility is repayable on or before October 31, 2007.