Oilsands Quest receives approval for 15-year leases for Axe Lake lands

CALGARY, July 15, 2011 /CNW/ --
CALGARY, July 15, 2011 /CNW/ - Oilsands Quest Inc. (NYSE Amex:BQI)
('OQI' or 'the Company').

Oilsands Quest is pleased to announce that it has received approval from
the Government of Saskatchewan to convert portions of the Axe Lake
permits to 15-year leases. These leases, the first oil sands leases in
Saskatchewan, are one of the key elements the Company needs in place to
proceed to development of a commercial oil sands production facility.

'These leases mark a key milestone in our path forward,' said Garth
Wong, Chief Executive Officer of Oilsands Quest. 'In the past, some
potential investors have expressed concern about the short term permits
under which the Axe Lake lands were held. The 15-year leases will give
us the certainty of land tenure we need to underpin commercial
development at Axe Lake. The Government of Saskatchewan has
demonstrated its commitment to oil sands exploration and development,
and we appreciate its confidence that Oilsands Quest will be able to
deliver on the value of these assets both for our investors and for the
people of Saskatchewan.'

The two leases, OSA00001 and 0SA00002 will be governed under the terms
of the Petroleum and Natural Gas Regulations, 1969 and will expire on March 31, 2027.

Please see http://www.oilsandsquest.com/our_projects/july15-2011-map.html to view a map showing Oilsands Quest's land leases and permits.

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.  It
is leading the establishment of the province of Saskatchewan's emerging
oil sands industry.

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Investor Relations
Email: ir@oilsandsquest.com
Investor Line: 1-877-718-8941