ALBERTA STAR DEVELOPMENT CORP.
                           200 - 675 West Hastings Street
                         Vancouver, British Columbia V6B 1N2
                             Telephone:  (604) 681-3131
                             Facsimile:  (604) 801-5499

November 14, 2002

Tyhee Development Corp.
401- 675 West Hastings Street
Vancouver, British Columbia
V6B 1N2

Attention:  Dr. D.R. Webb, President

Dear Sirs:

Re:    Longtom Property, Northwest Territories

We confirm the following:

     A.       Pursuant to an  Option Agreement  dated  February 12, 1998  (the
              "Option Agreement"), Alberta  Star  Development Corp.  ("Alberta
              Star") has earned an undivided 50% interest in and to the Longtom
              Property (as defined in the Option Agreement)  (the "Property");
              and

     B.       Tyhee Development Corp. ("Tyhee") is the beneficial owner of the
              remaining undivided 50% interest in and to the  Property,  which
              is held in trust for  Tyhee by Dr.  Dave  Webb,  the  registered
              owner of Tyhee's interest in the claims comprising the Property.

Further to our recent discussions  concerning  Alberta  Star's  acquisition of
Tyhee's  50%  undivided  interest in the Property, we confirm our agreement as
follows:

1.            In this Agreement:

      (a)     "Expenditures" mean  exploration expenditures that Alberta Star,
               its joint venture  partners  or  any  optionees  incur  on  the
               Property,  commencing  on  the  date of  this  Agreement,  that
               qualify as Canadian Exploration   Expense  as  defined  in  the
               Canada Income Tax Act;

      (b)     "Notice Date" means the earlier of:

              (i)   the date that Alberta Star advises Tyhee in  writing  that
                    it will complete the purchase of Tyhee's 50%  interest  in
                    the Property; and

              (ii)   the date that Alberta Star has incurred  Expenditures  on
                     the Property totalling $5,000,000.

2.            Upon the execution of this Agreement, Tyhee shall cause Dr. Dave
              Webb to transfer its undivided 50% interest  in the  Property to
              Alberta  Star.  In consideration of this  transfer, Alberta Star
              agrees  to pay  $315,000  (the "Purchase Price") to Tyhee within
              90 days of the Notice Date.

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3.            Alberta Star shall have no obligation to pay the Purchase  Price
              to Tyhee unless the Notice Date is triggered.   If  Alberta Star
              abandons  its  interest  in  the  Property,  it  shall  have  no
              obligation  to pay  the  Purchase Price to Tyhee, provided  that
              Alberta Star transfers to Tyhee  a 50%  interest in the Property,
              subject to the 2%  net  smelter  returns  royalty  described  in
              the Option Agreement (the "Royalty"), should Tyhee request  such
              transfer  upon receiving  notice of  the  proposed  abandonment.
              Any Property  returned  to  Tyhee pursuant to this request shall
              be in good standing for  a  minimum  of  one  year from the date
              Alberta Star notifies Tyhee of abandonment.

4.            Alberta Star's 100% interest in the Property shall be subject to
              the Royalty.  Tyhee agrees to assist Alberta Star  in attempting
              to secure a purchase of this Royalty from its current owner.

5.            Alberta Star may, at its option, pay the Purchase Price either:

     (a)      in cash; or

     (b)      50% in cash and 50% in common shares in the capital  of  Alberta
              Star.  The deemed price of Alberta Star's common shares shall be
              the average TSX Venture Exchange closing market price of Alberta
              Star's  common   shares on  the  five  trading days  immediately
              preceding and the five trading days  immediately  following  the
              Notice Date.

6.            Upon execution  of  this  Agreement, Alberta Star shall have the
              right  to enter  into a joint venture or option agreement with a
              third  party,  which  joint  venture  or  option may  include  a
              disposition of Tyhee's former interest in the Property, provided
              that  such  interest  is subject to  the Royalty.  This interest
              must  be confirmed in writing to Tyhee prior to being effective.

7.            Except  as  amended  by  this  Agreement,  all  other  terms and
              conditions of  the  Febraury 12,  1998  Option  Agreement  shall
              remain  in  effect  and in  force  and shall survive the sale of
              Tyhee's  interest.   (this includes  continuing escrow releases,
              notices, maintenance of the property, indemnities etc.)

8.            This Agreement shall be subject to TSX Venture Exchange
              acceptance for filing.

9.            Alberta  Star  acknowledges  that  it   does  not  possess   any
              undisclosed material facts pertaining to the Longtom Property as
              of the date of this Agreement.

Please acknowledge your acceptance of the terms of this  Agreement by  signing
below and returning a duly executed copy of this letter to us, whereupon there
will be a binding agreement between us.

Yours truly,

                                          AGREED AND ACCEPTED this 14th day of
                                          November, 2002 by:

ALBERTA STAR DEVELOPMENT CORP.            TYHEE DEVELOPMENT CORP.

PER: /s/ Tim Coupland                     PER: /s/ David Webb
---------------------                     --------------------
Authorized Signatory                      Authorized Signatory