Crude Oil Tar Sand Companies

[NYBob]

Oilsands Quest forms technology company, updates Axe Lake
activities

Amex: BQI

CALGARY, Jan. 10 /CNW/ -

Oilsands Quest Inc. -
(Amex: BQI) today announced the formation of a subsidiary
company devoted to in-situ oil sands technology assessment
and development.
The company also provided an update of recovery development
and operations activities for its Axe Lake Discovery
in northwest Saskatchewan.

Oilsands Quest Technology Inc.

Dr. Erdal Yildirim, who is Oilsands Quest's Executive Vice
President, Project Development, has been appointed President
of Oilsands Quest Technology Inc, -
a wholly owned subsidiary of Oilsands Quest Inc.

"The progress in development of oil sands technologies has been
a significant driver in the growth, prosperity and
environmental sustainability of the oil sands industry"
said Dr. Yildirim, "yet it remains a relatively young
industry, where a new wave of technological advancements
is occurring through improvements to existing technologies,
commercialization of emerging technologies and creation of
new technologies generated by novel process concepts."

Oilsands Quest Technology has been created to be at the
forefront of this technology wave, to maximize the value
of its oil sands and oil shale assets and to generate
new business opportunities.
This will be accomplished by utilizing its in-depth technology
expertise for testing and developing technologies most
suitable to the characteristics of its natural resources.

Widely recognized within the industry for his leadership,
experience and technical expertise, Dr. Yildirim has served
in many managerial and executive capacities in
the oil sands industry.
He was the co-founder and chairman of the National Oil Sands
Task Force during the period of 1993 to 1996 and was
the co-founder and, since 1994, has been the Managing
Director of the Canadian Oil Sands Network for Research
and Development (CONRAD).

Axe Lake Recovery development program

Drilling to date within the Axe Lake Discovery area has
confirmed three reservoirs for potential development.
The three reservoirs, of roughly equal size, contain
the majority of Axe Lake's Discovered Resources.
These reservoirs are the focus of Oilsands Quest's
recovery development and production planning efforts.

In an extensive program of laboratory testing and reservoir
simulation studies, Oilsands Quest, its technical
consultants and its financial advisors are evaluating
existing in-situ recovery techniques.
These efforts have provided the initial definition of the
field test program to evaluate reservoir response to varying
temperatures and pressures of steam and steam with solvents.
A program of reservoir testing at three sites within
the Axe Lake Discovery is planned for the first half of 2008,
subject to regulatory approval.
The reservoir tests will provide up to 600 barrels per day
of initial bitumen volumes in 2008 that will contribute data
to the design of an in-situ test program of up to
10,000 barrels per day that is planned for start-up in 2009,
subject to regulatory approval.

Camp operations update

Oilsands Quest is operating two camps in Saskatchewan to
support its winter 2008 drilling, seismic and reservoir
testing activities.
The Base Camp will accommodate up to 200 personnel and
is located on the main access road adjacent to the
company's 5,000-foot (1500-metre) airstrip in the
northeast corner of the Axe Lake Discovery area.
he new South Camp will accommodate up to 250 people and
is located in Saskatchewan near the Alberta border,
12 miles (19 km) southwest of the Base Camp.
It will provide support to operations in both Alberta
and Saskatchewan.
Drilling has commenced in Alberta on the company's permit lands.
During the winter season, manpower is expected to peak
at approximately 450 personnel.

About Oilsands Quest Inc.

Oilsands Quest Inc. is aggressively exploring Canada's largest
contiguous oil sands land holding by applying its
technical expertise to develop multiple potential
global-scale discoveries.
The company
http://www.oilsandsquest.com
is the originator of Saskatchewan's emerging oil sands industry.

Forward-looking information

Except for statements of historical fact relating to Oilsands Quest, this news release contains certain "forward-looking information" within the meaning of applicable securities law. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate", "potential", "prospective" and other similar words, or statements that certain events or conditions "may", "will", or "could" occur. Forward-looking statements such as references to discovered and undiscovered resources estimates, references to Oilsands Quest's exploration, technical and development programs and future discoveries are based on the opinions and estimates of management and Oilsands Quest's independent evaluators at the date the statements are made and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking statements. These risks, uncertainties and other factors include, but are not limited to, exploration and technical risks inherent in the oil sands industry, regulatory and economic risks, lack of infrastructure in the region in which the company's resources are located and risks associated with Oilsands Quest's ability to implement its business plan. There are uncertainties inherent in forward-looking information, including factors beyond Oilsands Quest's control, and no assurance can be given that the programs will be completed on time, on budget or at all. Oilsands Quest undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change, except as required by law. The reader is cautioned not to place undue reliance on forward-looking statements. The risks and uncertainties set forth above are not exhaustive. Readers should refer to Oilsands Quest's current annual report on Form 10-KSB and other document filings, which are available at www.sedar.com and at www.sec.gov for a detailed discussion of these risks and uncertainties and details regarding the location and extent of Oilsands Quest's land holdings.

Source: Canada NewsWire (January 10, 2008 - 9:00 AM EST)

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