8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 OR 15(d) of
The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) March 19, 2007

Oilsands Quest Inc.

(Exact name of registrant as specified in its charter)

Colorado	0-27659	98-0461154
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

205, 707— 7th Avenue S.W. Calgary, Alberta, Canada	T2P 3H6
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code  (403) 263-1623

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

On March 19, 2007, Oilsands Quest Inc. (the “Company”) and Oilsands Quest Sask Inc., the Company’s wholly owned subsidiary (“OQI Sask”) established a committed secured line of credit with the Toronto-Dominion Bank (the “Credit Facility”) pursuant to a Credit Agreement. OQI Sask is the borrower under the Credit Facility and the Company provided a secured guarantee. The Credit Facility is a non-revolving facility providing for up to Cdn. $30 million by way of Prime Rate Loans at the prime rate and Bankers’ Acceptances at the applicable discount rate plus 50 basis points. Any amount drawn on the facility will be repayable at maturity on October 31, 2007. On March 21, 2007, OQI Sask borrowed Cdn. $25 million (US$21,592,500) under the Credit Facility to fund the purchase of land in the Athabasca region of north eastern Alberta.

Item 2.01 Completion of Acquisition of Assets.

The Company acquired 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).

The following are the results of Alberta Land Sale announced on 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, the Company 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 4^th 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 (see Item 1.01).

Item 7.01 Regulation FD Disclosure.

On March 22, 2007, the Company issued a press release announcing purchase of four parcels of land in the Athabasca region of north eastern Alberta. The press release is filed as Exhibit 99.1 to this report and is incorporated by reference herein.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

99.1 Press Release dated March 22, 2007.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Oilsands Quest Inc. (Registrant)
Date: March 22, 2007	/s/ Karim Hirji
	Name:	Karim Hirji
	Title:	Chief Financial Officer

EXHIBIT INDEX

Exhibit No.		Description
	99.1	Press Release dated March 22, 2007.

EX-99.1

Exhibit 99.1

  CUSIP# 678046 10 3
Amex: BQI

NEWS RELEASE

DATE: March 22, 2007

FOR IMMEDIATE RELEASE:

Oilsands Quest successfully acquires lands in Alberta contiguous to its Axe Lake Discovery

Calgary, Alberta — Oilsands Quest Inc. (Amex: BQI) announces the company 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 4^th 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.

  CUSIP# 678046 10 3
Amex: BQI

Conference Call

Oilsands Quest will host a conference call on Monday, March 26, 2007 to provide a comprehensive update of this winter’s exploration program and to discuss the implications of this purchase of oil sands permits in Alberta. Details regarding the time of the conference call and topics of discussion will be announced in a news release and posted on the Company’s website as soon as they are finalized.

Forward-Looking Information
Except for statements of historical fact relating to the company, 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” and other similar words, or statements that certain events or conditions “may” “will” or “could” occur. Forward-looking statements such as the references to Oilsands Quest Inc.’s drilling program, geophysical programs, testing and analysis programs and timing of such programs are based on the opinions and estimates of management 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, which include but are not limited to risks inherent in the oil sands industry, regulatory and economic risks, and risks associated with the company’s ability to implement its business plan. There are uncertainties inherent in forward-looking information, including factors beyond Oilsands Quest Inc.’s control, and no assurance can be given that the programs will be completed on time, on budget or at all. Oilsands Quest Inc. 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 exhausting. Readers should refer to Oilsands Quest’s current annual report on Form 10KSB 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 the Oilsands Quest permit lands.

For more information:

General inquiries and retail investors, contact Hedlin Lauder Investor Relations Ltd.

Toll Free	1-800-299-7823
Office	403-232-6251
Email	irinfo@hedlinlauder.com

Institutional investors, contact The Buick Group

Toll Free	1-877-748-0914
Office	416-915-0915
Email	jbuick@buickgroup.com