Oilsands Quest has received approval from the Alberta Court of Queen's Bench for the sale of the company's non-core Eagles Nest asset to Cavalier Energy, an unrelated third party, for C$7m ($7.05m).

Oilsands Quest reopened the sale process for its Eagles Nest asset, as FAMA Capital defaulted on an earlier purchase and sale agreement.

A new purchase and sale agreement has been signed between Oilsands Quest and Cavalier.

The transaction is expected to be completed on or before 23 March 2012, subject to normal closing conditions.

Oilsands Quest continues to operate under the protection of the Companies’ Creditors Arrangement Act (Canada) with the assistance of a court-appointed monitor.