Oilsands Quest Inc.

Oilsands Quest Inc., Calgary, (NYSE Amex: BQI) has retained TD Securities Inc. to explore strategic alternatives.

Oilsands Quest holds oil sands assets in Saskatchewan and Alberta.

"The time has come to seek a strategic partner, and we believe the best way to do that in the current market environment is to initiate a formal process to explore strategic alternatives," says T. Murray Wilson, chairman, president and chief executive. "We had originally planned to proceed on a standalone basis until we had completed our SAGD pilot project, but in light of the substantial capital we require to proceed both at Axe Lake and at Wallace Creek, we have determined that this is the prudent course of action.

"We are experiencing the growing pains that are common to smaller oil sands companies with significant opportunities. We are confident that upon closer examination of our assets, potential partners will recognize the significant underlying value currently not reflected in our share price and appreciate as we do the tremendous potential for oil sands development in northwest Saskatchewan and northeast Alberta."

Oilsands Quest planned a steam-assisted gravity drainage (SAGD) pilot project as the first step toward developing a 30,000 barrel-per-day commercial oil sands project at Axe Lake. At Wallace Creek, Oilsands Quest conducted a successful drilling program in late 2009 and early 2010, discovering a high-quality oil-sands reservoir. The company will need to continue to delineate this resource to determine its ultimate size and confirm its commercial development viability.

Contact Robert Mason, 403-299-8572, robert.mason@tdsecurities.com.