Oilsands Quest Receives Court Approval of $7 Million Sale of Eagles Nest Asset

Friday, Mar 16, 2012

CALGARY, ALBERTA – Oilsands Quest Inc. (NYSE Amex: BQI) (“Oilsands Quest,” or “the Company”) has received approval from the Alberta Court of Queen’s Bench (the “Court”) for the sale of the Company’s non-core Eagles Nest asset to Cavalier Energy Inc. (“Cavalier”), an unrelated third party, for CDN$7.005 million.

As previously announced, Oilsands Quest reopened the sale process for its Eagles Nest asset as FAMA Capital Ltd. defaulted on an earlier Purchase and Sale Agreement. The Company has signed a new Purchase and Sale Agreement with Cavalier and the transaction, subject to normal closing conditions, is expected to close on or before March 23, 2012.

Oilsands Quest continues to operate under the protection of the Companies’ Creditors Arrangement Act (Canada) (“CCAA”) with the assistance of a Court-appointed monitor. The Company’s common shares remain halted from trading until either a delisting occurs or until the NYSE permits the resumption of trading.

About Oilsands Quest

Oilsands Quest Inc. (www.oilsandsquest.com) is exploring and developing oil sands permits and licences, located in Saskatchewan and Alberta, and developing Saskatchewan's first commercial oil sands discovery.

Source: Oilsands Quest Inc