Agoracom Updates

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The Omagine Project

Omagine, Inc. (“OMAG”), through its 60% owned subsidiary Omagine LLC, plans to develop a $2 billion real-estate, tourism and entertainment project (the "Omagine Project") in the Sultanate of Oman.. Omagine LLC was formed in Oman by OMAG as a wholly owned subsidiary and OMAG subsequently arranged for Omagine LLC to sell a 40% equity ownership interest in Omagine LLC to two partners for $70 million. The 2 partners are (i) the Sultan of Oman, and (ii) a $5 billion multi-national corporation.

The Omagine Project is planned to be developed on one million square meters (equal to approximately 245 acres) of beachfront land facing the Gulf of Oman (the "Omagine Site") just west of the capital city of Muscat and approximately six miles from Muscat International Airport. It is planned to be an integration of cultural, heritage, educational, entertainment and residential components, including: a "high culture" theme park containing seven pearl shaped buildings, each approximately 60 feet in diameter, associated exhibition buildings, a boardwalk, an open air amphitheater and stage; open space green areas; a canal and an enclosed harbor and marina area; associated retail shops and restaurants, entertainment venues, boat slips, and docking facilities; a five-star resort hotel, a four-star resort hotel and possibly a three or four-star hotel; commercial office buildings; shopping and retail establishments integrated with the hotels, and approximately two thousand residences to be developed for sale. OMAG owns all the copyrights and intellectual property associated with the Omagine brand.

The Shareholder Agreement

OMAG and three (3) investors (the “New Shareholders”) have signed a legally binding shareholders’ agreement with respect to Omagine LLC (the “Shareholder Agreement”).

The New Shareholders (described below) are (i) RCA, (ii) CCC-Panama and (iii) CCC-Oman and pursuant to the Shareholders Agreement, the New Shareholders have agreed to invest $70 million into Omagine LLC.

The Office of Royal Court Affairs ("RCA"), is an Omani organization representing the personal interests of His Majesty, Sultan Qaboos bin Said, the ruler of Oman.

Consolidated Contractors International Company, SAL, (“CCIC”) is a 60 year old multi-national company with five and one-half (5.5) billion dollars in annual revenue, one hundred twenty thousand (120,000) employees worldwide, and operating subsidiaries in the U.S., South America, Europe, Asia, and in every country in the Middle East.

Consolidated Contracting Company S.A. (“CCC-Panama”) is a wholly owned subsidiary of CCIC and is its investment arm.

Consolidated Contractors (Oman) Company LLC, (“CCC-Oman”) is an Omani construction company with approximately 13,000 employees in Oman and is CCIC’s operating subsidiary in Oman.

Development Agreement

The contract between the Ministry of Tourism of the Government of Oman (“MOT”) and Omagine LLC governing the development and ownership of the Omagine Project is the "Development Agreement" ("DA"). The Development Agreement has been approved by all the required Ministries of the Government of Oman. The DA must be signed by Omagine LLC and the Government of Oman in order to begin development of the Omagine Project.

Although the Omagine Project and the Omagine DA have received multiple Government approvals over the past several years, the DA signing has been delayed due to Government bureaucracy and the international financial crisis. Management is of the opinion that these delays were generally not contrary to OMAG’s interests, that the present financing environment in Oman is positive and favorable, and that the DA signing is now imminent. To the best knowledge and belief of OMAG and its attorneys, no further barrier to signing the DA for the Omagine Project with Omagine LLC now exists.

Representatives of the shareholders of Omagine LLC (OMAG, Royal Court Affairs, and Consolidated Contractors) have met with His Excellency Ahmed Al-Mahrizi, the Minister of Tourism, and his staff several times during 2012.

These meetings affirmed that the Minister and MOT are enthusiastic about the development of the Omagine Project. The Minister has stated that he was entirely satisfied with our project plans and presentation, that he agreed it will be a wonderful project for Oman, and that he is agreeable to sign the DA as soon as possible.

The ownership percentages of Omagine LLC presently are:

Omagine, Inc.(OMAG)60%

Royal Court Affairs (RCA)25%

CCC-Panama10%

CCC-Oman5%

OMAG reduced its 100% ownership of Omagine LLC to 60% in 2011 when it arranged for Omagine LLC to sell newly issued shares of its capital stock to the New Shareholders and to Omagine, Inc. for a cash investment amount of approximately $70.1 million (the “Cash Investment”) which will be invested in three stages.

$390,000 of initial capital has been received by Omagine LLC from the New Shareholders and Omagine, Inc.

Subsequent to the signing of the DA, an additional portion of the Cash Investment equal to approximately $546,000 will be received by Omagine LLC from Omagine, Inc.

At the time the project financing is arranged, the final portion of the Cash Investment equal to approximately $70 million will be received by Omagine LLC from the New Shareholders.

In addition, the value of the non-cash “payment-in-kind” investment by RCA will be added to Omagine LLC’s capital after such value is determined subsequent to the signing of the Development Agreement.

OMAG’s total investment into Omagine LLC for its 60% ownership stake will be $780,000 of the total of $71 million being invested by all the Omagine LLC shareholders for their ownership stakes.

OMAG management has held numerous discussions with several of the largest banks in the Middle East as well as with internationally prominent European banks and investment bankers. Management presently expects the project financing for the Omagine Project to be arranged and in place within twelve months after the signing of the DA.

In order to move into the actual design and development stage of the Omagine Project, Omagine LLC and the Government must first sign the Development Agreement.

Please be advised that (i) no assurance can be given at this time that the Development Agreement will be signed, and (ii) the foregoing assumptions and this discussion are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 which involve uncertainties and other factors which could cause the outcomes described herein to differ from future Company achievements as expressed or implied by such forward-looking statements.