Canadian Oil Sands Announces Mine Extension Project at Mildred Lake

CALGARY, ALBERTA -- (Marketwire) -- 10/01/12 -- Canadian Oil Sands Limited (TSX: COS) (OTCQX: COSWF) ("COS") announced today Syncrude will embark upon a mine extension project at its Mildred Lake mine ("the MLX Project").

The MLX Project will leverage current investments in the replacement of the two mine trains currently being constructed at the Mildred Lake mine, and will be integrated with existing environmental infrastructure, to access nearby bitumen deposits on Syncrude leases. The proposed project should enable Syncrude to extend the life of mining operations at Mildred Lake by about a decade. Project scoping is currently underway, and pending regulatory approval, construction and spending would commence in the next 10 years.

"Syncrude benefits from abundant high-quality resources across its leases, and this results in flexibility to optimize timing and scope of development through an ongoing review process," said Marcel Coutu, President and Chief Executive Officer of COS. "The prioritization of the MLX Project at this stage reflects our expectation that it will provide very attractive economic returns by extending the useful life of the mine trains that we are building today into the 2030s and, importantly, will provide an opportunity to minimize new land disturbance through the utilization of existing environmental and operating infrastructure."

Syncrude commenced the regulatory process today with the release of a public disclosure document. Syncrude intends to build on its existing strong relationships with stakeholders by engaging them in discussions about the project plans and details early in the development timeline. More information on the regulatory process and stakeholder consultation is available at www.syncrude.com.

Canadian Oil Sands Limited

Canadian Oil Sands is a pure investment opportunity in light, sweet crude oil. Through our 36.74% interest in the Syncrude project, we offer a solid, robust production stream of fully upgraded crude oil, exposure to future crude oil prices, potential growth through high-quality oil sands leases and an attractive dividend.

Advisory

In the interest of providing Canadian Oil Sands Limited ("COS") shareholders and potential investors with information regarding COS, including management's assessment of COS' future plans and operations, certain statements throughout this release contain "forward-looking information" under applicable securities law. Forward-looking statements in this release include, but are not limited to, statements with respect to: the expected regulatory application relating to the Mildred Lake mine extension (the "MLX Project"); the timing of construction and spending for the MLX Project; the expectation that the MLX Project should enable Syncrude to extend the life of mining operations at Mildred Lake by more than a decade; the expectation that the MLX Project will provide very attractive economic returns by extending the useful life of the mine trains being built at Mildred Lake into the 2030s and the belief that the MLX Project will provide an opportunity to minimize new land disturbance through the utilization of existing environmental and operating infrastructure. You are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur.

Although COS believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. The factors or assumptions on which the forward-looking information is based include, but are not limited to: the ability to obtain regulatory approvals; the MLX Project scope and the continuation of assumed regulatory regimes. Some of the risks and other factors which could cause results to differ materially from those expressed in the forward-looking statements contained in this release include, but are not limited to: the impacts of legislative or regulatory changes especially as such relate to the environment and tailings; unsuccessful or untimely implementation of capital projects; the inability to obtain regulatory approvals and such other risks and uncertainties described in COS' Annual Information Form dated February 23, 2012 and in the reports and filings made with the securities regulatory authorities from time to time by COS, which are available on COS' profile on SEDAR at www.sedar.com and on COS' website at www.cdnoilsands.com. You are cautioned that the foregoing list of important factors is not exhaustive. Furthermore, the forward-looking statements contained in this release are made as of the date of this release, and unless required by law, COS does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this release are expressly qualified by this cautionary statement.

Shares Listed

Toronto Stock Exchange Symbol: COS

OTCQX Symbol: COSWF

Contacts:

Canadian Oil Sands Limited

Marcel Coutu

President & Chief Executive Officer


Canadian Oil Sands Limited

Alison Trollope

Manager, Investor Relations

(403) 218-6231
invest@cdnoilsands.com
www.cdnoilsands.com