MINERAL PROPERTY PURCHASE AGREEMENT


              THIS AGREEMENT dated for reference January 27, 2003.


BETWEEN:

         DAVID G. LORNE, of 101 - 1184 Denman Street, Vancouver, British
         Columbia, V6G 2M9;

         (the "Vendor")

                                                            OF THE FIRST PART

AND:

         ALBERTA STAR DEVELOPMENT CORP.,  a body corporate,  duly incorporated
         under the laws of the Province of British Columbia and having its head
         office at 200-675 West Hastings St., Vancouver, British Columbia,
         V6B1N2;

         ("Alberta Star")

                                                            OF THE SECOND PART

W H E R E A S :

A.       The Vendor is the registered and beneficial owner of a  50%  undivided
         interest in one mineral claim located  approximately   350  kilometres
         north of Yellowknife,   Northwest Territories, which  claim  is   more
         particularly described in Schedule "A" attached hereto  which  forms a
         material part hereof (collectively, the "Claim");

B.       The Vendor has agreed to sell and  Alberta Star has agreed to purchase
         a 50% undivided right, interest and title in and to the Claim upon the
         terms and conditions hereinafter set forth;

         NOW  THEREFORE THIS  AGREEMENT  WITNESSETH  that in  consideration  of
         the mutual covenants and provisos herein contained, THE PARTIES
         HERETO AGREE AS FOLLOWS:

1.       VENDOR'S REPRESENTATIONS

1.1      The Vendor represents and warrants to Alberta Star that:

   (a)   The Vendor is the beneficial owner of an  undivided  50%  interest  in
         the Claim and holds the right to transfer  title to  his  interest  in
         the Claim and to act as operator of the Claim;

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   (b)   The Vendor holds his 50% interest in the Claim free and clear  of  all
         liens, charges and claims of others, and  the Vendor  has a  free  and
         unimpeded  right  of  access  to  the Claim and has use of  the  Claim
         surface for the herein purposes;

   (c)   The Claim has been duly and validly located and recorded in a good and
         miner-like manner pursuant to the laws  of the  Northwest  Territories
         and is in good standing in the Northwest Territories as of the date of
         this Agreement;

   (d)   There are no adverse claims or challenges against or to  the  Vendor's
         ownership  of  or title  to  his  interest  in  the  Claim nor to  the
         knowledge of the Vendor is there any basis therefor, and there are  no
         outstanding agreements or options  to  acquire  or  purchase  his 50%
         interest in the Claim or any portion thereof;

   (e)   The Vendor has the full right, authority and capacity  to  enter  into
         this Agreement without first obtaining the consent of any other person
         or body corporate and  the  consummation  of  the  transaction  herein
         contemplated will not conflict with or result  in any  breach  of  any
         covenants or  agreements contained in, or constitute a default  under,
         or result in the creation of any  encumbrance under  the provisions of
         any indenture, agreement or other instrument  whatsoever to  which the
         Vendor is a party or by which he is bound or to which he is  subject;
         and

   (f)   No proceedings are pending for, and the Vendor is unaware of any basis
         for,  the institution  of  any  proceedings  which  could  lead to the
         placing of the Vendor in bankruptcy, or in  any  position  similar  to
         bankruptcy.

1.2      The representations and warranties of the Vendor set out in paragraph
         1.1 above form a part of this Agreement and are conditions upon which
         Alberta Star has relied in entering  into this  Agreement  and  shall
         survive the acquisition of any interest in the Claim by Alberta Star.

1.3      The Vendor will indemnify Alberta Star from all loss, damage,  costs,
         actions and suits arising out of or in connection with any  breach of
         any representation, warranty, covenant, agreement or  condition  made
         by the Vendor and contained in this Agreement.

1.4      The Vendor acknowledges and agrees that Alberta Star has entered into
         this Agreement relying on the warranties and representations and other
         terms and conditions of this Agreement and that no  information  which
         is now known or which may  hereafter  become  known to  Shabute  shall
         limit or extinguish the right to indemnity hereunder, and, in addition
        to any other remedies it may pursue, Alberta Star may deduct the amount
        of any such loss or damage from any amounts payable by it to the Vendor
        hereunder.

2.     ALBERTA STAR'S REPRESENTATIONS

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         Alberta Star warrants and represents to the Vendor that it is  a body
         corporate, duly incorporated under the laws of the Province of British
         Columbia with full power and absolute  capacity  to  enter  into  this
         Agreement and that the terms of this Agreement have been authorized by
         all necessary corporate acts and deeds in order to give effect to the
         terms hereof.



3.       SALE OF INTEREST IN CLAIM

         The Vendor hereby sells,  grants and devises to  Alberta Star  a  50%
         undivided  right,    title  and  interest in  and  to  the  Claim  in
         consideration of Shabute:

   (a)   paying $3,500 to the Vendor upon execution of this Agreement;

   (b)   paying an additional $11,500 to the Vendor upon TSX Venture Exchange
         acceptance for filing of this Agreement ("Exchange Acceptance");

   (c)   issuing 200,000 common shares in its capital stock at a deemed  price
         of $0.20 to  the Vendor within  five  days of  Exchange  Acceptance;

   (d)   incurring a minimum of $50,000 in  exploration  expenditures  on  the
         Claim prior to December 31, 2003; and

   (e)   incurring a further $50,000 in exploration expenditures on the  Claim
         prior to December 31, 2004.

4.       TRANSFER OF CLAIM

         Upon Exchange Acceptance, the Vendor shall register a 50% interest in
         and to the Claim into the name of Alberta Star.  Should Alberta Star,
         at any time, determine that it wishes to abandon its interest  in the
         Claim, Alberta Star must first provide the Vendor with 30 days notice
         of its intention to do so.  Upon receipt of such notice,  the  Vendor
         may request Alberta Star to retransfer the title its interest  in the
         Claim to him, and Alberta Star hereby agrees to do so.

5.       COVENANTS OF ALBERTA STAR

         Alberta Star shall perform all  work on the Claim  in a  miner - like
         manner and shall comply with  all laws,  regulations  and  permitting
         requirements  of  C anada  and the  Northwest  Territories  including
         compliance with all:

   (a)   environmental statutes, guidelines and regulations;

   (b)   work permit conditions for lakes and streams; and

   (c)   work restrictions relating to forest fire hazards.

6.       FORCE MAJEURE

<PAGE>

         If Alberta Star is prevented from or delayed in  complying  with  any
provisions of this Agreement by reason of strikes, labour disputes,  lockouts,
labour shortages, power shortages,  fires,  wars,  acts of  God,  governmental
regulations restricting  normal  operations or  any  other  reason or  reasons
beyond the control of Alberta Star, the time limited for  the  performance  of
the various provisions of this Agreement as set out above shall be extended by
a period of  time  equal in length to the period of such prevention and delay,
and Alberta Star, insofar as is possible, shall promptly give  written  notice
to the Vendor of the particulars of the  reasons for any  prevention or  delay
under this section, and shall take all reasonable steps to remove the cause of
such prevention or delay and shall give written notice to the Vendor  as  soon
as such cause ceases to exist.

7.       JOINT VENTURE AGREEMENT

         Upon Alberta Star providing all the consideration due  to the  Vendor
pursuant to paragraph 3, the Vendor  and  Alberta  Star  shall  form a  single
purpose joint venture to further  explore  and  develop the  Claim  and  shall
execute a joint venture agreement on terms and conditions acceptable  to  each
party, substantially in the form of the Rocky Mountain Mineral Law  Foundation
Form No. 5, but not inconsistent with the terms of this Agreement.

8.       RIGHT OF ENTRY

For so long as this Agreement continues in full force and effect,Alberta Star,
its employees, agents, permitted assigns and independent  contractors shall as
operator, have the right and option to:

   (a)   enter upon the Claim;

   (b    )have exclusive and quiet possession of the Claim;

   (c)   incur expenditures;

   (d)   bring upon and erect upon the Claim such mining facilities as Alberta
         Star may consider advisable; and

   (e)   remove from the Claim and sell or otherwise dispose of mineral
         products.

9.   OPERATOR

         After the execution of this Agreement, Alberta Star will act as  the
operator of the Claim under this Agreement.  Alberta Star may resign  as  the
operator at any time by giving 30 calendar days prior written  notice to  the
Vendor, and within such 30 day period, the Vendor may  appoint another  party
who covenants to act as the operator  of the  Claim  upon  such terms as  the
Vendor sees fit.

10.      POWER AND AUTHORITY OF THE OPERATOR

         After the execution of this Agreement, the operator  shall have  full
         right, power and authority to do everything necessary or desirable in
         connection with the exploration and development of the Claim  and  to
         determine the manner of operation of the Claim as a mine.

<PAGE>

11.   ENTIRE AGREEMENT

         This Agreement constitutes the entire agreement to  date between  the
         parties hereto and supersedes every previous agreement, communication,
         expectation, negotiation, representation  or  understanding,  whether
         oral or written, express or implied, statutory or otherwise, between
         the parties with respect to the subject matter of this Agreement.

12.   NOTICE

12.1     Any notice required to be given under this Agreement shall be deemed
to be well and sufficiently given if delivered, in the case of the Vendor, as
follows:

         David G. Lorne
         101 - 1184 Denman Street
         Vancouver, British Columbia
         V6G 2M9

and, in the case of Shabute, as follows:

         Alberta Star Development Corp.
         200-675 West Hastings Street
         Vancouver, British Columbia
         V6B 1N2

and any notice given as aforesaid  shall  be  deemed to  have  been  given, if
delivered, when delivered, or if mailed, on the fourth business day after  the
date of mailing thereof.

12.2     Either party may from time to time by notice in  writing  change  its
address for the purpose of this paragraph.

13.      RELATIONSHIP OF PARTIES

         Nothing  contained  in  this Agreement shall, except  to  the  extent
specifically  authorized  hereunder,  be  deemed to  constitute either party a
partner, agent or legal representative of the other party.

14.      FURTHER ASSURANCES

         The parties hereto agree to do or cause to be done all acts or things
necessary to implement and carry into effect the provisions and intent of this
Agreement.

15.      TIME OF ESSENCE

         Time shall be of the essence of this Agreement.



16.      TITLES

<PAGE>

         The  titles to the respective  sections hereof shall not be  deemed a
part of  this  Agreement  but  shall be  regarded  as  having  been   used for
convenience only.

17.      CURRENCY

         All funds referred to under the  terms  of  this Agreement  shall  be
funds designated in the lawful currency of Canada.

18.      NONSEVERABILITY

         This  Agreement  shall  be  considered and  construed  as  a   single
instrument and the failure  to  perform  any of the  terms  and conditions  in
this  Agreement  shall  constitute  a  violation   or  breach  of  the  entire
instrument  or  Agreement  and  shall constitute the basis for cancellation or
termination.

19.      APPLICABLE LAW

         The situs of the Agreement is Vancouver, British Columbia, and for all
purposes this Agreement will be governed exclusively by and construed and
enforced in accordance with the laws prevailing in the Province of British
Columbia.

20.      ENUREMENT

         This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective successors and assigns.

21.      ASSIGNMENT

         Either party may assign part or all of its interest in the Claim with
the other party's consent, which consent shall not be unreasonably withheld.

         IN WITNESS WHEREOF this Agreement has been executed as of the day and
year first above written.



                                                        ALBERTA STAR
                                                        DEVELOPMENT CORP.

/s/ David Lorne                                         PER: /s/ Tim Coupland
_______________________                                 _____________________
DAVID G. LORNE                                          TIM COUP LAND
                                                        PRESIDENT



                                SCHEDULE "A"
                                ------------

             TO THAT CERTAIN AGREEMENT MADE AS OF JANUARY 27, 2003
           BETWEEN DAVID G. LORNE AND ALBERTA STAR DEVELOPMENT CORP.


The Claim consists of one mineral claims located in the Northwest Territories,
Canada with the following record number and area:

      Claim Name            Record No.                  Acreage

      Target 1               F71013                     1,781.9