<PAGE>
                          FORM 10-Q
              SECURITIES AND EXCHANGE COMMISSION
                   Washington, D.C. 20549

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
            SECURITIES EXCHANGE ACT OF 1934


For the Quarterly Period Ended: March 31, 2011
                                --------------

Commission File Number: 0-17264
                        -------

                      Omagine, Inc.
    ----------------------------------------------------
   (Exact name of registrant as specified in its charter)


         Delaware                           20-2876380
---------------------------------      ---------------------
State or other jurisdiction             (I.R.S. Employer
of incorporation or organization)      Identification Number)


      350 Fifth Avenue, Suite 1103, New York, N.Y. 10118
      --------------------------------------------------
            (Address of principal executive offices)


                      (212) 563-4141
   ----------------------------------------------------
   (Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15 (d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.   [X] Yes   [ ] No


                            (1)
<PAGE>

Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate website, if any,
every Interactive Data File required to be submitted and posted
pursuant to Rule 405 of Regulation S-T (232.405 of this chapter)
during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files).
[ ] Yes  [ ] No

Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer,
or a smaller reporting company.


Large accelerated filer [ ]                Accelerated filer [ ]

Non-accelerated filer   [ ]        Smaller reporting company [X]


Indicate by a check mark whether the registrant is a shell
company (as defined in Rule 12b-2 of the Exchange Act).
[ ] Yes  [X] No

As of May 12, 2011, the Registrant had outstanding 12,601,361
shares of Common Stock, par value $.001 per share.


















                            (2)


<PAGE>
                       OMAGINE, INC.
                          INDEX

Forward-Looking Statements

             PART I - FINANCIAL INFORMATION

ITEM 1:  FINANCIAL STATEMENTS

       CONSOLIDATED BALANCE SHEETS:
       MARCH 31, 2011 AND DECEMBER 31, 2010

       CONSOLIDATED STATEMENTS OF OPERATIONS:
       THREE MONTHS ENDED MARCH 31, 2011 AND MARCH 31, 2010

       CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS'
       EQUITY:
       THREE MONTHS ENDED MARCH 31, 2011

       CONSOLIDATED STATEMENTS OF CASH FLOWS:
       THREE MONTHS ENDED MARCH 31, 2011 AND MARCH 31, 2010

       NOTES TO FINANCIAL STATEMENTS


ITEM 2:  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS

ITEM 4:  CONTROLS AND PROCEDURES

ITEM 4T: CONTROLS AND PROCEDURES


             PART II - OTHER INFORMATION

ITEM 2:  UNREGISTERED SALES OF EQUITY SECURITIES AND
          USE OF PROCEEDS

Item 6:  EXHIBITS

         SIGNATURES



                            (3)
<PAGE>

Forward-Looking Statements

Some of the information contained in this Report may constitute
forward-looking statements or statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are based on current expectations and
projections about future events. The words "estimate", "plan",
"intend", "expect", "anticipate" and similar expressions are
intended to identify forward-looking statements which involve,
and are subject to, known and unknown risks, uncertainties and
other factors which could cause the Company's actual results,
financial or operating performance or achievements to differ
from future results, financial or operating performance or
achievements expressed or implied by such forward-looking
statements. Projections and assumptions contained and expressed
herein were reasonably based on information available to the
Company at the time so furnished and as of the date of this
filing. All such projections and assumptions are subject to
significant uncertainties and contingencies, many of which are
beyond the Company's control, and no assurance can be given that
the projections will be realized. Potential investors are
cautioned not to place undue reliance on any such forward-
looking statements, which speak only as of the date hereof. The
Company undertakes no obligation to publicly release any
revisions to these forward-looking statements to reflect events
or circumstances after the date hereof or to reflect the
occurrence of unanticipated events.















                            (4)

<PAGE>
                             PART I - FINANCIAL INFORMATION

ITEM 1:  FINANCIAL STATEMENTS
<TABLE>                     OMAGINE, INC. AND SUBSIDIARIES
                             CONSOLIDATED BALANCE SHEETS
<CAPTION>
                                                    March 31,       December 31,
                                                      2011              2010
           ASSETS                                   ---------       -----------
                                                   (Unaudited)
<S>                                               <C>               <C>
CURRENT ASSETS:
  Cash                                             $ 101,643          $ 148,217
  Prepaid expenses and other current assets           10,737                150
                                                    --------           --------
       Total Current Assets                          112,380            148,367
                                                    --------           --------
PROPERTY AND EQUIPMENT:
  Office and computer equipment                      132,570            132,570
  General plant                                       17,800             17,800
  Furniture and fixtures                              15,951             15,951
  Leasehold improvements                                 866                866
                                                    --------           --------
                                                     167,187            167,187
  Less: Accumulated depreciation and amortization   (161,925)          (160,990)
                                                    --------           --------
                                                       5,262              6,197
                                                    --------           --------
  Other assets                                        13,361             13,361
                                                    --------           --------

TOTAL ASSETS:                                      $ 131,003          $ 167,925
                                                   =========          =========
           LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
  Convertible notes payable and accrued
     interest                                      $ 609,479          $ 596,888
  Accounts payable                                   364,529            403,095
  Accrued officers' payroll                          509,799            457,299
  Due officers and directors                           8,045              8,205
  Accrued expenses and other current liabilities      55,463             50,483
                                                   ---------          ---------
        Total Current Liabilities                  1,547,315          1,515,970
        Long Term Liabilities                            -                  -
                                                   ---------          ---------

TOTAL LIABILITIES:                                 1,547,315          1,515,970
                                                   ---------          ---------
COMMITMENTS

STOCKHOLDERS' EQUITY:
  Preferred stock:
  $0.001 par value
  Authorized: 850,000 shares
   Issued and outstanding: - none                        -                  -

  Common stock:
  $0.001 par value
  Authorized: 50,000,000 shares
   Issued and outstanding:
    12,364,162 shares in 2011                         12,364
    12,107,646 shares in 2010                                            12,108
Capital in excess of par value                    19,190,388         18,913,269
Retained earnings (deficit)                      (20,619,064)       (20,273,422)
                                                 -----------        -----------
     Total Stockholders' Equity (Deficit)         (1,416,312)        (1,348,045)
                                                 -----------         ----------
Total Liabilities And Stockholders' Equity       $   131,003         $  167,925
                                                 ===========         ==========


<FN>
See accompanying notes to consolidated financial statements.
</FN>
</TABLE>




                                         (5)





















<PAGE>
<TABLE>
                      OMAGINE, INC. AND SUBSIDIARIES
                   CONSOLIDATED STATEMENTS OF OPERATIONS
<CAPTION>
                                                        THREE MONTHS ENDED
                                                            March 31,
                                                      ----------------------
                                                       2011            2010
                                                       ----            ----
                                                    (Unaudited)     (Unaudited)
<S>                                             <C>              <C>
REVENUE:
  Net sales                                       $       -        $      -
                                                   ----------      -----------
Total revenue                                             -               -
                                                   ----------      -----------

COSTS AND EXPENSES:
  Cost of sales                                           -               -

  Officers and directors compensation
    (including stock-based compensation
     Of $90,933 and $95,318 respectively)             163,433         167,818
  Professional fees                                    42,390          31,898
  Travel                                               15,486           8,352
  Occupancy                                            32,418          33,219
  Other general and administrative                     78,588          64,865
                                                   ----------      ----------
  Total Costs and Expenses                            332,315         306,152
                                                   ----------      ----------
OPERATING LOSS                                       (332,315)       (306,152)

  Interest income                                         -               -
  Interest expense                                    (13,327)         (7,801)
                                                  ------------     -----------
NET LOSS                                          $  (345,642)     $ (313,953)
                                                  ============     ===========

LOSS PER SHARE - BASIC AND DILUTED                $      (.03)     $     (.03)
                                                  ============     ===========

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING -
  BASIC AND DILUTED                                12,240,373      10,770,719
                                                  ===========      ===========

<FN>
See accompanying notes to consolidated financial statements.
</FN>
</TABLE>






                                           (6)


















<PAGE>
<TABLE>

                           OMAGINE, INC. AND SUBSIDIARIES
         CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited)

<CAPTION>
                                    Common Stock
                                  ----------------    Capital in    Retained
                                            Par       Excess of     Earnings
                                  Shares    Value     Par Value    (Deficit)
                                 ---------------------------------------------
<S>                           <C>          <C>       <C>         <C>

Balances At December 31, 2010  12,107,646   $12,108   $18,913,269 $(20,273,422)

Contribution of Common Stock
   to 401K Plan                    51,784        52        72,448

Stock option expense                  -         -          23,125

Sale of Common Stock for cash      57,018        57        49,943

Sale of Stock Under Standby
   Equity Distribution
   Agreement                      132,714       132       124,868

Stock grant to consultant          15,000       15          6,735

Net loss                              -        -              -       (345,642)
                               ----------   -------   -----------  -----------
Balances At March 31, 2011     12,364,162   $12,364   $19,190,388 $(20,619,064)
                               ----------   -------   ----------- ------------
<FN>
See accompanying notes to consolidated financial statements.
</FN>
</TABLE>

                                           (7)

<PAGE>
<TABLE>
                            OMAGINE, INC. AND SUBSIDIARIES
                         CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
                                                           Three Months Ended March 31,
                                                           ----------------------------
                                                                2011         2010
                                                                ----         ----
                                                            (Unaudited)   (Unaudited)
<S>                                                       <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:

  Net loss                                                   $(345,642)  $ (313,953)
  Adjustments to reconcile net loss to net cash
   flows used by operating activities:
    Depreciation and amortization                                  935          948
    Stock based compensation related to stock options           23,125       27,510
    Issuance of Common Stock for 401K contribution              72,500       72,500
    Issuance of stock grant to consultant                        6,750
 Changes in operating assets and liabilities:
    Prepaid expenses and other current assets and other
     assets                                                    (10,587)        (640)
    Accounts payable                                           (38,566)      32,038
    Accrued expenses and other current liabilities               4,980        5,547
    Accrued officers' payroll                                   52,500       72,500
    Accrued Interest on convertible notes payable               12,591        6,426
                                                             ----------   ----------
  Net cash flows used by operating activities                 (221,414)    ( 97,124)
                                                             ----------   ----------



CASH FLOWS FROM FINANCING ACTIVITIES:
   Loans from officers and directors                            (  160)      (2,450)
   Proceeds from sales of common stock                         175,000       50,000
                                                            -----------    ----------
         Net cash flows provided by financing activities       174,840       47,550
                                                            -----------    ----------

NET CHANGE IN CASH                                             (46,574)    ( 49,574)

CASH BEGINNING OF PERIOD                                       148,217      155,821
                                                            -----------   ----------
CASH END OF PERIOD                                          $  101,643  $   106,247
                                                            =========== ============

SUPPLEMENTAL CASH FLOW INFORMATION:

  Income taxes paid                                        $       -    $       910
                                                           ============ ============
  Interest paid                                            $       -    $       -
                                                           ============ ============


<FN>
See accompanying notes to consolidated financial statements.
</FN>
</TABLE>

                                        (8)


<PAGE>

OMAGINE, INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED (UNAUDITED) INTERIM
                    FINANCIAL STATEMENTS


NOTE 1 - BASIS OF PRESENTATION


The consolidated balance sheet for Omagine, Inc. ("Omagine" or
the "Company") at the end of the preceding fiscal year has been
derived from the audited balance sheet and notes thereto
contained in the Company's annual report on Form 10-K for the
Company's fiscal year ended December 31, 2010 and is presented
herein for comparative purposes. All other financial statements
are unaudited. In the opinion of management, all adjustments,
which include only normal recurring adjustments necessary to
present fairly the financial position, results of operations and
cash flows for all periods presented, have been made.

The results of operations for the interim periods presented
herein are not necessarily indicative of operating results for
the respective full years. As of the date of this report the
Company has two wholly-owned subsidiaries, Journey of Light,
Inc. and Omagine LLC through which it conducts all operations.
All inter-company transactions have been eliminated in the
consolidated financial statements.

Certain footnote disclosures normally included in financial
statements prepared in accordance with accounting principles
generally accepted in the United States have been omitted in
accordance with the published rules and regulations of the
Securities and Exchange Commission. These financial statements
should be read in conjunction with the financial statements and
notes thereto included in the Company's annual report on Form
10-K for the fiscal year ended December 31, 2010.

Earnings (Loss) Per Share - Basic earnings (loss) per share is
based upon the weighted-average number of common shares
outstanding during the period. Diluted earnings (loss) per share
is based upon the weighted-average number of common shares and
dilutive securities (such as stock options and convertible
securities) outstanding. Dilutive securities having an anti-
dilutive effect on diluted earnings (loss) per share are

                            (9)
<PAGE>

excluded from the calculation.

For the three months ended March 31, 2011 and 2010, diluted
shares outstanding excluded the following dilutive securities as
the effect of their inclusion would be anti-dilutive.


                                       Shares Issuable
                                     ------------------
                                     Three Months Ended
                                         March 31,
                                     ------------------
                                     2011          2010
                                     ----          ----


Convertible Notes                   271,835       136,008


Stock Options                       404,000       342,000
                                    -------       -------

Total Shares                        675,835       478,008
                                    -------       -------

Principles of Consolidation - The consolidated financial
statements include the accounts of Omagine and its wholly-owned
subsidiaries, Journey of Light, Inc. ("JOL") and Omagine LLC,
collectively referred to as the "Company". On November
23, 2009, Omagine LLC ("LLC"), an Omani corporation, was
organized by Omagine in the Sultanate of Oman. LLC is presently
owned 95% by Omagine and 5% by JOL. LLC's ownership is expected
to be reduced to a 60% majority ownership by Omagine via the
sale of newly issued LLC common stock to three minority
investors who are expected to purchase an aggregate of 40% of
LLC for a total aggregate investment of $69.4 million. All
intercompany transactions have been eliminated in consolidation.

NOTE 2 - GOING CONCERN AND LIQUIDITY

At March 31, 2011, the negative working capital of the Company
was $1,434,935. Further, the Company incurred net losses of
$345,642 and $1,277,001 for the three months ended March 31,

                            (10)
<PAGE>

2011 and for the year ended December 31, 2010, respectively.
These factors raise substantial doubt about the Company's
ability to continue as a going concern. The continued existence
of the Company is dependent upon its ability to execute its
business plan and attain profitable operations or obtain
additional financing.

NOTE 3 - CONVERTIBLE NOTES PAYABLE AND ACCRUED INTEREST


Convertible notes payable and accrued interest consist of:

                                      March 31,     December 31,
                                        2010           2009
                                      ---------     ------------

Due to the president of the Company,
  interest at 8%, due on demand,
  convertible into common stock at
  a conversion price of $2.00 per
  share:
    Principal                         $ 192,054     $ 192,054
    Accrued interest                     40,074        36,285

Due to the secretary of the Company,
  interest at 8%, due on demand,
  convertible into common stock at
  a conversion price of $2.00 per
  share:
    Principal                            39,961        39,961
    Accrued interest                      8,338         7,550

Due to a director of the Company,
  interest at 10%, due on September
  16, 2011($100,000) and November
  4, 2011 ($50,000), convertible into
  common stock at a conversion
  price of $2.50 per share:
    Principal                           150,000       150,000
    Interest                              7,384         3,685

Due to investors, interest at 15%,
  due on demand, convertible into
  common stock at a conversion price
  of $2.50 per share:
    Principal                            50,000        50,000
    Accrued interest                     15,524        13,675

Due to investors, interest at 10%,
  due from July 27, 2011 to October
  19, 2011, convertible into common
  stock at a conversion price of
  $2.50 per share:
    Principal                           100,000       100,000
    Interest                              6,144         3,678
                                       --------       -------

Totals                                $ 609,479     $ 596,888
                                      =========     =========



                            (11)
<PAGE>

NOTE 4 - COMMON STOCK


In March 2010, the Company issued and contributed a total of
289,996 shares of Common Stock to all eligible employees of the
Omagine, Inc. 401(k) Plan.

In March 2010, the Company issued a total of 83,257 shares of
Common Stock for proceeds of $50,000 under the Standby Equity
Distribution Agreement with YA Global Investments L.P. (See
Note 6).

From January 2011 to March 2011 the Company issued a total of
132,714 shares of Common Stock for proceeds of $125,000 under
the Standby Equity Distribution Agreement with YA Global
Investments L.P. (See Note 6).

In February and March 2011, the Company sold to an accredited
investor 57,018 shares of Common Stock for proceeds of $50,000.

On March 4, 2011, the Company issued 15,000 shares of Common
Stock to a consultant for services rendered.


NOTE 5 - STOCK OPTIONS

The following is a summary of stock option activity for the
three months ended March 31, 2011:

Outstanding at January 1, 2011                        528,000
Granted and Issued                                        -
Exercised                                                 -
Forfeited/expired/cancelled                               -
                                                    ---------

Outstanding at March 31, 2011                         528,000
                                                    ---------

Exercisable at March 31, 2011                         404,000
                                                    ---------

                            (12)

















<PAGE>
<TABLE>
Stock options outstanding at March 31, 2011 (all non-qualified) consist of:

<CAPTION>
<C>           <C>               <C>                 <C>             <C>
   Year           Number            Number            Exercise           Expiration
 Granted        Outstanding       Exercisable          Price                Date
 -------        -----------       -----------         --------           ----------

  2001           150,000            150,000           $1.25           August 31, 2011
  2005            40,000             40,000           $4.10         December 31, 2011
  2007(A)        160,000            128,000           $1.25            March 31, 2017
  2007            12,000             12,000           $4.50          October 29, 2012
  2008             6,000              6,000           $4.00         December 31, 2012
  2008(B)        150,000             60,000           $2.60        September 23, 2018
  2008(C)          6,000              4,000           $2.60        September 23, 2013
  2010             4,000              4,000           $0.51             June 30, 2015
               ---------          ----------
 Totals          528,000            404,000
               =========          ==========
<FN>

   (A)  The 32,000 unvested options relating to the 2007 grant are scheduled to vest
        on April 1, 2011.
   (B)  The 90,000 unvested options relating to the 2008 grant are scheduled to vest
        30,000 on each September 24, 2011, 2012 and 2013.
   (C)  The 2,000 unvested options relating to the 2008 grant are scheduled to vest
        on September 24, 2011.

       As of March 31, 2011, there was $197,886 of total unrecognized compensation cost
       relating to unexpired stock options. That cost is expected to be recognized
       $69,373 in 2011, $75,447 in 2012 and $53,066 in 2013.

</FN>
</TABLE>

                                      (13)
<PAGE>
NOTE 6 - COMMITMENTS

Leases

The Company leases its executive office in New York, New York
under a ten-year lease entered into in February 2003. The
Company also rents warehouse space in Jersey City, New Jersey
under a month-to-month lease. The Company also leases office
space in Muscat, Oman under a lease expiring June 30, 2011. Rent
expense for the three months ended March 31, 2011 and 2010 was
$32,418 and $33,219, respectively.

At March 31, 2011, the future minimum lease payments under non-
cancelable operating leases are as follows:

          2011                 42,600
          2012                 56,800
          2013                  9,466
                            ----------
          Total             $ 108,866
                            ==========

Employment Agreements

Pursuant to an employment agreement dated September 1, 2001,
Omagine was obligated to pay its President and Chief Executive
Officer an annual base salary of $125,000 through December 31,
2010 plus an additional amount based on a combination of net
sales and earnings before taxes. The Company's Compensation
Committee expects to decide terms of a new employment agreement
in the second quarter of 2011. For the three months ended March
31, 2011, the Company has continued to accrue salaries payable
to the President on the basis of an annual salary of $125,000.

Omagine had been obligated to employ its Vice-President and
Secretary under an employment agreement which was cancelled.
Provided the Company is successful in signing the Development
Agreement with the Government of Oman for the Omagine Project,
the Company intends to enter into a new employment agreement
with this individual.

Equity Financing Agreement

On December 22, 2008, Omagine entered into a Standby Equity

                            (14)
<PAGE>

Distribution Agreement (the "SEDA") with YA Global Investments,
L.P. ("YA"). Pursuant to the terms of the SEDA, Omagine may, at
its sole option and upon giving written notice to YA (a
"Purchase Notice"), sell shares of its Common Stock (the
"Shares") to YA at a per Share "Purchase Price" equal to 95% of
the lowest daily volume weighted average price for a share of
Omagine's Common Stock as quoted by Bloomberg, L.P. during the
five (5) consecutive trading days following such Purchase Notice
(the "Pricing Period").  During the term of the SEDA, the
Company is not obligated to sell any Shares to YA but may, at
its sole discretion, sell that number of Shares valued at the
Purchase Price from time to time in effect that equals up to
$5,000,000 in the aggregate. YA is obligated to purchase such
Shares from the Company subject to certain conditions including
(i) Omagine filing a registration statement with the Securities
and Exchange Commission (the "SEC") to register the Shares
("Registration Statement"), (ii) the SEC declaring such
Registration Statement effective, (iii) periodic sales of Shares
to YA must be separated by a time period equal to the Pricing
Period, and (iv) the amount of any such individual periodic sale
of Shares may not exceed $200,000. All sales of Shares pursuant
to the SEDA are made at the sole discretion of the Company. The
Registration Statement filed by the Company with the SEC was
declared effective by the SEC as of May 1, 2009 and its
effective status expired on April 30, 2010. The Company filed a
new Registration Statement with the SEC to continue to make
sales available to it pursuant to the SEDA and the SEC declared
such new Registration Statement to be effective as of June 7,
2010. The SEDA expired on April 30, 2011.

On May 4, 2011, The Company executed a new two year SEDA with YA
Global Master SPV Ltd. ("YA Ltd.") under substantially the same
terms and conditions as the SEDA executed between YA and the
Company in December 2008. See Note 7.

Omagine Project

The Company's proposed 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
nearby Muscat International Airport. The Company is awaiting the
conclusion of the documentary process with respect to the

                            (15)
<PAGE>

Omagine Project and the signing of a Development Agreement with
the Government of Oman.

The Omagine Project contemplates the integration of cultural,
heritage, educational, entertainment and residential components,
including a theme park and associated exhibition buildings,
shopping and retail establishments, restaurants and several
million square feet of residential development.

NOTE 7 - SUBSEQUENT EVENTS

In April 2011, the Company sold a total of 60,728 shares of its
Common Stock to YA pursuant to the SEDA for proceeds of $40,000.

On May 4, 2011, the Company executed a new two year SEDA with YA
Ltd. under substantially the same terms and conditions as the
SEDA dated December 22, 2008 (See Note 6). Pursuant to the SEDA,
the Company issued one hundred seventy six thousand four hundred
seventy one (176,471) restricted shares of Common Stock to YA
Ltd. in satisfaction of YA Ltd.'s $150,000 commitment fee for
the SEDA.



ITEM 2 -   Management's Discussion and Analysis of Financial
           Condition and Results of Operations

As of the date of this report all of the Company's operations
are conducted through its wholly-owned subsidiaries, Journey of
Light, Inc. ("JOL") and Omagine LLC ("LLC").


Critical Accounting Policies:
-----------------------------
Our financial statements have been prepared in accordance
with accounting principles generally accepted in the United
States. The preparation of these financial statements requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses
during the reporting period. The policies discussed below are
considered by management to be critical to an understanding of

                            (16)
<PAGE>

our financial statements because their application places the
most significant demands on management's judgment, with
financial reporting results relying on estimation about the
effect of matters that are inherently uncertain. Specific risks
for these critical accounting policies are described in the
following paragraphs. For all of these policies, management
cautions that future events rarely develop exactly as forecast,
and the best estimates routinely require adjustment.

Revenue Recognition. In the event the Company signs a
Development Agreement with the Government of Oman, the Company
and Omagine LLC will recognize revenue ratably over the
development period, measured by methods appropriate to the
services and products provided.

General Statement: Factors that may affect future results
---------------------------------------------------------

With the exception of historical information, the matters
discussed in Management's Discussion and Analysis of Financial
Condition and Results of Operations constitute forward-looking
statements within the meaning of the 1995 Private Securities
Litigation Reform Act that involve various risks and
uncertainties.  Typically, these statements are indicated by
words such as "anticipates", "expects", "believes", "plans",
"could", and similar words and phrases. Factors that could cause
the Company's actual results to differ materially from
management's projections, forecasts, estimates and expectations
include, but are not limited to, the following:

* Failure of the Company's Oman based subsidiary, Omagine LLC
   (the "Project Company"), to sign the Development Agreement
   with the Government of Oman;

* Failure of the Project Company to obtain the necessary
   financing required to design, build and operate the
   Omagine Project;

* Inability of the Company to secure additional financing;

* Unexpected economic or political changes in the United States
   or abroad, or political instability or civil unrest in Oman
   or in the Middle East & North Africa (the "MENA Region");

                              (17)
<PAGE>

* The imposition of new restrictions or regulations by
   government agencies in the U.S. or the MENA Region that
   affect the Company's business activities.


The present nature of the Company's business is such that it is
not expected to generate revenue until after the occurrence of
an event - the development of the Omagine Project - which, as of
the date hereof, is not certain to occur. Management is
presently examining other possible sources of revenue which,
subject to the Development Agreement being executed, may be
added to the Company's operations.



The Omagine Project
-------------------

The Company is engaged primarily in the business of real estate
development in the country of the Sultanate of Oman ("Oman").

The Company has proposed to the Government of Oman (the
"Government") the development of a real estate and tourism
project (the "Omagine Project") to be developed by Omagine LLC
in Oman. Omagine LLC was formed in Oman as a limited liability
company on November 23, 2009 for the purpose of designing,
developing, owning and operating the Omagine Project.

We anticipate that the Omagine Project will 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 nearby 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
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 an additional three or four-star hotel; commercial
office buildings; shopping and retail establishments integrated

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with the hotels, and more than two thousand residences to be
developed for sale.

Significant commercial, retail, entertainment and hospitality
elements are also included in the Omagine Project which is
expected to take more than five years to complete. The Company
plans, over time, to also be in the property management,
hospitality and entertainment businesses.

Non-Omani persons (such as expatriates living and working in
Oman) are not permitted by Omani law to purchase land or
residences in Oman outside of an Integrated Tourism Complex
("ITC"). Pursuant to the Development Agreement as presently
contemplated, the Government will issue a license to Omagine
LLC designating the Omagine Project as an ITC and as such,
Omagine LLC will be permitted to sell the freehold title to land
and residential properties which are developed on the Omagine
Site to any person, including any non-Omani person.

The Development Agreement
-------------------------

The contract between the Government and Omagine LLC which will
govern the design, development, construction, management and
ownership of the Omagine Project, and the Government's and
Omagine LLC's rights and obligations with respect to the Omagine
Project, is the "Development Agreement" (the "DA").

In June 2010 the Ministry of Tourism of the Sultanate of Oman
("MOT") approved the proposed Development Agreement between the
Government and Omagine LLC. The Government approval process
required additional approvals from the Ministry of Finance
("MOF") and the Ministry of Legal Affairs ("MOLA") of the
Sultanate of Oman. In October 2010 the proposed Development
Agreement was approved by MOF. Following Omagine LLC's response
to MOLA's comments on the DA, MOT informed Omagine LLC in
writing (the "MOT Transmittal") that all matters are now
finalized. MOT had also requested that we provide MOT with the
final version of the DA so that MOT and Omagine LLC may proceed
with the execution of the DA. On March 30, 2011 in response to
the MOT Transmittal, Omagine LLC's attorneys sent the final
version of the DA (the "Final DA") to the MOT.

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<PAGE>

While, management presently expects that the Final DA will in
fact be final, management cautions that (i) some of the language
in the MOT Transmittal was vague, and (ii) the MOT Transmittal
sought at the last minute to reopen long-ago agreed and approved
matters and the reopening of these previously agreed and
approved matters was rejected by Omagine LLC. Omagine LLC
counsel subsequently communicated in writing to the MOT
providing historical documentation in support of these
matters having previously been agreed to and successfully
concluded. The MOT legal department thereafter informed
Omagine LLC that the newly appointed Minister of Tourism is
presently reviewing the agreements for all ITC projects,
including the Final DA for the Omagine Project and that we
should have MOT's advice shortly.

The date of signing the Development Agreement is entirely in the
hands of the Government but management anticipates that the DA
will be signed shortly after the completion of the aforesaid
review process and the registration with the Ministry
of Commerce of Oman of the ownership positions of the Omagine
LLC shareholders (the "Registration"). The Registration is a
necessary condition precedent to the signing of the DA.

In spite of the extraordinary delays to date, the Company
believes that the Government remains eager to conclude and sign
the DA as soon as possible. We are presently awaiting the MOT's
response to the Final DA.

The Shareholder Agreement
-------------------------

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 Lebanese
multi-national company headquartered in Athens, Greece. In 2010
CCIC had approximately five and one-half (5.5) billion dollars
in annual revenue, one hundred twenty thousand (120,000)
employees worldwide, and operating subsidiaries in, among other
places, every country in the MENA Region. 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

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<PAGE>

Omani limited liability company and is CCIC's operating
subsidiary in Oman.

The three new Omagine LLC investors are (i) RCA, (ii) CCC-Panama
and (iii) CCC-Oman (collectively, the "New Shareholders").
Extensive discussions and negotiations among the New
Shareholders and their respective attorneys and Omagine, Inc.
and its attorneys took place between January 2011 and mid-April
2011. A written agreement (the "Shareholder Agreement") has now
been verbally agreed by the New Shareholders and Omagine, Inc.
The parties to the Shareholder Agreement are the New
Shareholders and Omagine, Inc.

The Shareholder Agreement is not a legally binding agreement
until it is signed by all the parties and management presently
expects that the Shareholder Agreement will be signed by it and
the New Shareholders imminently. At the end of April 2011
Omagine LLC received verbal confirmation from RCA that the RCA
investment committee and the RCA legal department had both
reviewed and approved the Shareholder Agreement and that it is
now with the Minister of the Royal Court for his signature. The
Company anticipates that the Minister of RCA (also newly
appointed) will review and sign the Shareholder Agreement
imminently.

The following discussion and all references in this report to
"the Shareholder Agreement" assumes that the Shareholder
Agreement will be signed by all the parties thereto.
Notwithstanding the foregoing sentence or any reference in this
report to the Shareholder Agreement, no assurance can be given
at the present time that the Shareholder Agreement will actually
be signed by the parties thereto.

The Shareholder Agreement will supersede and replace all other
prior agreements or memoranda of understanding between or among
any party and Omagine LLC or the Company with respect to
investment in and ownership of Omagine LLC.

Pursuant to the provisions of the Shareholder Agreement,
Omagine, Inc. will reduce its 100% ownership of Omagine LLC to
sixty percent (60%) and Omagine LLC will sell newly issued
shares of its capital stock to the New Shareholders and to
Omagine, Inc.

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<PAGE>

The Shareholder Agreement defines the "Financing Agreement Date"
as the day upon which Omagine LLC and an investment fund, lender
or other person first execute and deliver a legally binding
financing agreement. The Financing Agreement Date is presently
projected by management to occur within twelve months after the
signing of the DA.

The Shareholder Agreement specifies that the New Shareholders
will fund the bulk of their respective investments on or shortly
after the Financing Agreement.

The Shareholder Agreement specifies that Omagine, Inc. and JOL
will ultimately invest a total of 300,000 Omani Rials
(approximately $780 thousand U.S. dollars) into Omagine LLC in
three tranches, the result of which will be that Omagine, Inc.
will reduce its 100% ownership of the capital stock of Omagine
LLC to 60%. The Shareholder Agreement also specifies that the
Omagine LLC shares presently owned by JOL will be transferred to
Omagine, Inc.

The Shareholder Agreement also recognizes the payment-in-kind
("PIK") capital contribution to be made by RCA to Omagine LLC
represented by the approximately 245 acres of beachfront land
constituting the Omagine Site which His Majesty the Sultan owned
and transferred to the Government for the specific purpose of
developing it into the Omagine Project. The value of the PIK
will be determined at a later date by a professional valuation
expert and in accordance with Omani law and with the concurrence
of Omagine LLC's independent auditor.

The final percentage ownership result as specified in the
Shareholder Agreement is as follows:

Omagine, Inc.    60%
RCA              25%
CCC-Panama       10%
CCC-Oman          5%

and subsequent to the cash investments into Omagine LLC being
made by the above shareholders, the capital of Omagine LLC
(exclusive of any capital increase resulting from the valuation
of the PIK) will be 26,988,125 Omani Rials (approximately $70
million U.S. dollars).

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<PAGE>

All proceeds from the sales of capital stock to the New
Shareholders and to Omagine, Inc. will belong to Omagine LLC.
None of the New Shareholders are affiliates of the Company. The
Shareholder Agreement also specifies, among other things, the
corporate governance and management policies of Omagine LLC.

As required by Omani law, Omagine LLC will complete the
Registration as promptly as possible after the Shareholder
Agreement is signed by all the parties. The Registration is a
straightforward non-controversial process and is expected to be
completed in a timely manner.

Although present market conditions remain somewhat unsettled,
management remains optimistic that subsequent to the signing of
the DA, Omagine LLC will be able to sell a percentage of its
equity to one or more third party investors for an amount in
excess of the average investment amount of the New Shareholders.

Pursuant to the terms of the Shareholder Agreement as presently
agreed:

1.  the New Shareholders (RCA, CCC-Panama and CCC-Oman) will
subscribe for and purchase an aggregate of 40% of the capital
stock of Omagine LLC for an aggregate cash investment into
Omagine LLC of 26,688,125 Omani Rials (approximately (69,389,125
U.S. dollars) of which 60,000 Omani Rials (approximately
(156,000 U.S. dollars) will be invested before the DA is signed
and 26,628,125 Omani Rials (approximately 69,233,125 U.S.
dollars) will be invested on, or shortly after, the Financing
Agreement Date, and

2.  Omagine, Inc. will own 60% of Omagine LLC and Omagine,
Inc.'s aggregate cash investment into Omagine LLC will be
300,000 Omani Rials (approximately 780,000 U.S. dollars) of
which:
(i) 20,000 Omani Rials (approximately 52,000 U.S. dollars) was
invested by Omagine, Inc. in November 2009 to organize Omagine
LLC; and
(ii) 70,000 Omani Rials (approximately 182,000 U.S. dollars)
will be invested by Omagine, Inc. before the DA is signed.
$162,500 of the foregoing $182,000 was invested by Omagine, Inc.
during the fourth quarter of 2010 leaving a balance of 7,500

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<PAGE>

Omani Rials or $19,500 to be invested by Omagine, Inc. before
the DA is signed; and
(iii) the OMAG Final Investment of 210,000 Omani Rials
(approximately 546,000 U.S. dollars) will be invested by
Omagine, Inc. after the DA is signed but before the Financing
Agreement Date.

All of the aforementioned investment amounts and ownership
percentages were negotiated in arms-length transactions between
Omagine LLC and the New Shareholders by Omagine, Inc. management
on behalf of Omagine LLC.

The Shareholder Agreement specifies that Omagine LLC will
have approximately $70 million of capital represented by
cash investments by Omagine, Inc. and the New Shareholders.
Although it remains uncertain as of the date hereof Omagine LLC
may also have a yet to be determined amount of additional
capital resulting from RCA's payment-in-kind to Omagine LLC.

The Oman Integrated Tourism Projects Fund (the "Fund") is an
investment fund managed by Bank Muscat. Omagine LLC has held
discussions with the Fund and Bank Muscat and may enter into an
agreement subsequent to the signing of the DA whereby the Fund
provides subordinate debt financing ("Mezzanine Financing") to
Omagine LLC. Bank Muscat has informed Omagine LLC that the Fund
will deliver a term sheet with respect to the provision of such
Mezzanine Financing to Omagine LLC. The term sheet is expected
to be received subsequent to the signing of the DA.

As mentioned above, pursuant to the provisions of the
Shareholder Agreement, the total amount of cash investment into
Omagine LLC by Omagine, Inc. and the New Shareholders will be
approximately $70 million (the "Capital Infusion") and although
Omagine, Inc. will invest $546,000 of that Capital Infusion
before the Financing Agreement Date, the vast proportion of such
Capital Infusion ($69,233,125) will not be invested by the New
Shareholders until the Financing Agreement Date.

While Omagine LLC will have the financial capacity to undertake
certain limited initial planning and design activities
immediately after the DA is signed, if it wishes to begin
extensive design and development activities it will have to sell

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<PAGE>

additional equity or raise additional alternative financing.
Otherwise it will have wait until the Financing Agreement Date
occurs to perform such extensive design and development
activities.

Management presently intends to pursue the sale of a percentage
of Omagine LLC's equity to one or more third party investors as
soon as reasonably possible subsequent to the signing of the DA.
With the Shareholder Agreement and the Development Agreement
signed, management presently believes it can maintain Omagine,
Inc.'s majority control of Omagine LLC while successfully
selling such Omagine LLC equity to new investors.

Consolidated Contractors International Company, S.A.L. ("CCIC")
is a 50 year old Lebanese multi-national corporation
headquartered in Athens, Greece whose main activities involve
general building and contracting services. CCIC employs
approximately 120,000 people worldwide, has annual revenue of
approximately $5.5 billion and operations in, among other
places, all the countries in the MENA Region.

Consolidated Contracting Company S.A., a Panamanian corporation
("CCC-Panama") is a wholly owned subsidiary of CCIC and is the
investment arm of CCIC.

Consolidated Contractors Company (Oman), LLC, an Omani limited
liability company ("CCC-Oman") is a construction company with
approximately 13,000 employees in Oman and is CCIC's operating
subsidiary in Oman.

Pursuant to the Shareholder Agreement, CCC-Panama and CCC-Oman
will invest an aggregate of 19,010,000 Omani Rials (equivalent
to $49.4 million) into Omagine LLC and CCC-Oman will (subject to
the approval of all the shareholders of Omagine LLC) be
appointed as the general contractor for the construction of the
Omagine Project. The investments by CCC-Panama and CCC-Oman will
be contingent only upon the signing of a contract between
Omagine LLC and CCC-Oman appointing CCC-Oman as such general
contractor.

Omagine, Inc. invested 20,000 Omani Rials, (equivalent to
$52,000) into Omagine LLC at its formation in November 2009 and
an additional 62,500 Omani Rials (equivalent to $162,385) during

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<PAGE>

the fourth quarter of 2010. Pursuant to the Shareholder
Agreement, Omagine, Inc. will make additional capital
investments into Omagine LLC of (i) 7,500 Omani Rials
(equivalent to $19,500) prior to the signing of the DA and (ii)
210,000 Omani Rials (equivalent to $546,000) [the "OMAG Final
Investment"] after the signing of the DA but prior to the
Financing Agreement Date.

Omagine, Inc. will, as provided for in the Shareholder
Agreement, receive payment in full of (i) the Pre-Development
Expense Amount and, (ii) a "success fee" as described below.

The Pre-Development Expense Amount (estimated at approximately
nine (9) million U.S. dollars) is the amount of expenses
incurred by the Company prior to the signing of the DA with
respect to the planning, concept design, re-design, engineering,
financing, capital raising costs and promotion of the Omagine
Project, and with respect to the negotiation and conclusion of
the Development Agreement with the Government.

The Shareholder Agreement defines the "Draw Date" as the
date upon which Omagine LLC receives the first amount of debt
financing pursuant to a legally binding financing agreement.
The Shareholder Agreement specifies that the Pre-Development
Expense Amount will be paid to Omagine, Inc. as follows: (i)
fifty percent (50%) of the Pre-Development Expense Amount will
be paid to Omagine, Inc. on or within ten (10) Days after the
Draw Date, and (ii) the remaining fifty percent (50%) of the
Pre-Development Expense Amount will be paid to Omagine, Inc. in
five equal annual installments beginning on the first
anniversary of the Draw Date.

The Shareholder Agreement further specifies that in addition to
the Pre-Development Expense Amount, a "success fee" of ten (10)
million U.S. dollars will be paid to Omagine, Inc. in five
annual two (2) million dollar installments beginning on or
within ten (10) days after the Draw Date.

The Shareholder Agreement provides that Omagine LLC shall,
subject to the approval of the Omagine LLC shareholders hire
Michael Baker Corp. ("Baker") as its Program and Project
Manager. Baker is a publicly traded U.S. firm (AMEX: BKR) in the
business of providing program management, engineering, design

                              (26)
<PAGE>

and construction management services to a wide variety of
clients including the Department of Defense and several state
governments. The Company has employed Baker through the
feasibility and engineering study phases of the Omagine Project
and anticipates that Omagine LLC will execute an agreement with
Baker soon after the signing of the Development Agreement.
Several Baker representatives and senior executives have made
several trips to Oman to visit with management, examine the
Omagine Site and plan for Baker's future involvement with
Omagine LLC. In March 2011 the President and CEO of Baker and a
Vice-President met with the Company's president in Oman.

Baker (www.mbakercorp.com) is headquartered in Pittsburgh, PA,
with offices throughout the U.S. and abroad and is experienced
in all aspects of design, program management and construction
management for large scale construction and development projects
of the magnitude of the Omagine Project. Baker has significant
program management and construction management contracts with
the United States military worldwide - including in the Middle
East.

The Company is in the final selection process for interpretive
designers and entertainment content and visitor experience
designers to be hired by Omagine LLC. The candidates have been
narrowed to a short list of professional companies. One or more
of such companies ("Content Developers") will be engaged by
Omagine LLC to transform the Company's high level strategic
vision for the content of the Pearl structures and surrounding
areas into physical places offering physical, emotional and
intellectual interactions. Each of the prospective candidates
has serviced a diverse client base, including theme parks,
museums, zoos, aquariums and other such complex entertainment
centers around the world, including in the Middle East, and each
continues to regularly produce world class attractions globally
of the size and scope of the Omagine Project.

In order to move into the actual design and development stage of
the Omagine Project, Omagine, Inc. and the New Shareholders must
first sign the Shareholder Agreement and Omagine LLC and the
Government must then sign the Development Agreement. While this
process has been delayed to date, management remains confident
that the Shareholder Agreement will be signed by it and the New
Shareholders within the next several days and although the

                              (27)
<PAGE>

precise date for the signing of the DA is not possible to
predict at this time, management presently believes that
attainment of the ultimate objective of signing the Development
Agreement with the Government is also imminent. As of the date
of this report, management believes that the only remaining
tasks before signing the DA are (i) signing the Shareholder
Agreement, and (ii) the Registration.

Notwithstanding the foregoing, no assurance can be given at this
time that either the Shareholder Agreement or the Development
Agreement actually will be signed.

The financial results of Omagine LLC will be consolidated into
the financial results of the Company in accordance with
accounting principles generally accepted in the United States.
As a result of its proposed 60% ownership of Omagine LLC, the
Company is therefore expected to experience an increase in net
worth on a consolidated basis of approximately $42 million on or
shortly after the Financing Agreement Date when, pursuant to the
terms of the Shareholder Agreement, the approximately $70
million investment by the New Shareholders will be recorded as
capital on Omagine LLC's financial statements.

The capital of Omagine LLC as well as bank borrowings and
Mezzanine Financing, if any, and proceeds from the sales by
Omagine LLC of (i) additional equity stakes and (ii) residential
and commercial properties, are expected to be utilized by
Omagine LLC to develop the Omagine Project. Omagine LLC's
ongoing financial results will be consolidated with the
Company's results as appropriate for as long as Omagine, Inc.
remains a shareholder of Omagine LLC.

As presently contemplated, Bank Muscat (which is 30% owned by
RCA and is Oman's largest financial institution) will be engaged
by Omagine LLC as a non-exclusive financial advisor to assist
Omagine LLC in arranging the necessary construction financing
for the Omagine Project ("Construction Financing") and other
financing for Omagine LLC as may be required.

While the worldwide bank liquidity issues resulting from the
2008-2009 financial crisis have eased, the project financing
environment in Oman remains more cautious and challenging than
before the crisis. Management is in contact on a regular basis

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<PAGE>

with Bank Muscat and other MENA Region and international
financial institutions regarding the financing of the Omagine
Project and presently management is cautiously optimistic that
it will be able to arrange the necessary project financing for
the Omagine Project. Omagine LLC's prospective Omani and
international bankers are presently of the opinion that the
project finance market in Oman remains in the recovery phase due
to the slowdown and price decreases experienced in the local
residential and commercial real estate markets during the last
few years. The market intelligence garnered by management
indicates that local bankers and market participants expect that
price stabilization followed by a recovery in both transaction
volume and pricing is expected to occur during 2011 and 2012.
Should this recovery in fact occur (and management presently
believes that it will), Omagine LLC should be well positioned to
benefit from such a recovery since, from a timing perspective,
Omagine LLC's present plans contemplate a year of intensive
design and planning activities followed by the launch in the
second half of 2012 of residential and commercial sales at the
Omagine Project.

As the development program becomes more detailed and as the
planning and design processes progress, the estimates of
construction costs have and will become proportionately more
accurate. The Company presently expects, based on present
assumptions of Omagine LLC's updated development program that
the development costs (including the costs for design,
construction management, program management and construction)
for the entire Omagine Project will be between approximately
$2.1 and $2.5 billion dollars. As noted below however, the costs
of labor and materials as well as the selling prices and market
absorption rates of new residential housing and commercial
properties remain somewhat volatile and accurate projections for
such future costs, selling prices or market absorption rates
cannot be made at this time. The Company nevertheless presently
expects, based on present assumptions and market activity, that
although the selling prices of residential housing in Oman have
fallen from their overheated 2007/2008 peaks, such residential
prices during the Omagine Project's 2012 sales launch will be at
least equal to the prices that are presently budgeted in Omagine
LLC's financial model.

As noted herein, costs and selling prices remain somewhat

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<PAGE>

volatile as the economy in Oman and the surrounding region
recovers and improves, and undue reliance on present projections
should be avoided. Management cautions that future events rarely
develop exactly as forecast, and the best estimates routinely
require adjustment.

Omagine LLC's financial model is frequently updated, modified
and adjusted in order to capture what management believes are
present market realities and projected trends. The financial
model is organized to show best case, worst case and probable
case scenarios. The most recent probable case scenario forecasts
net positive cash flows for Omagine LLC in excess of $1 billion
dollars over the seven year period subsequent to the signing of
the Development Agreement with a net present value of the
Omagine Project in excess of $500 million dollars. Management
believes this is a conservative forecast but cautions that it is
an uncertain forecast. Omagine LLC will update this model at
regular intervals as new facts and information become available,
as the development program and design process unfolds and as
market conditions require.

The sale of residential and commercial properties combined with
the increase over the last several years in the value of the
land constituting the Omagine Site, are the main revenue drivers
supporting Omagine LLC's financial projections.

Management cautions that investors should not place undue
reliance on the aforementioned financial model projections or on
estimates by market participants mentioned herein as all such
projections, estimates and forecasts are subject to significant
uncertainties and contingencies, many of which are beyond the
Company's control, and no assurance can be given that the
projections will be realized or that the estimates or forecasts
will prove to be accurate. Potential investors are cautioned not
to place undue reliance on any such forward-looking statement or
forecast, which speaks only as of the date hereof.

Although the Oman economy has not been as severely affected by
the recent worldwide financial crisis as nearby Dubai or other
countries, it did experience negative effects, slowdowns and
volatility in both prices and market absorption rates. Raw
material and labor prices initially dropped dramatically and
have now recovered somewhat and stabilized. Recent sales prices

                              (30)
<PAGE>

for housing in other integrated tourism projects in the Muscat
area of Oman appear to have stabilized below their 2007/2008
peaks but above the 2006 levels, and the inventory of unsold
housing in the secondary (re-sale) market has diminished which
some market observers see as an important indicator of pent-up
future demand. The market absorption rates (number of market
transactions) for new residential housing is presently tepid but
some market observers and real estate agents expect a resurgence
during 2011 with others expecting it in 2012 as existing pent-up
demand is unleashed and buyers' caution ameliorates. Assuming
the DA is signed in June of 2011, Omagine LLC would not begin
offering residential units for sale until approximately the
second half of 2012.

Subsequent to the signing of the Development Agreement, the
Omagine Site's value will be definitively determined by a
qualified independent real-estate appraiser and such appraisal
will be utilized by Omagine LLC's financial advisors in their
discussions with banks and other financial institutions in order
to arrange the Construction Financing. Omagine LLC's requirement
for Construction Financing is expected to be reduced by its
ability to pre-sell residence units by entering into sales
contracts with third party purchasers and receiving deposits and
progress payments during the construction of such residences.
Recent trends in the local market however have indicated a
reduced consumer appetite for such pre-sales as some buyers are
demanding a finished product before entering into sales
contracts with developers.

The Development Agreement as presently contemplated and agreed,
allows for sales and pre-sales of any of the residential or
commercial buildings that will be developed and built on the
Omagine Site. The freehold title to the land within the Omagine
Site underlying such residences or commercial properties shall
be transferred to the buyer at the closing of such sales
transactions.

The Company continues the preparation for its anticipated future
business activities in various ways including but not limited
to: (i) recruiting various executive level personnel that will
be required to ramp up organizationally for the Omagine Project,
(ii) negotiating the outlines of initial contracts with the
major vendors, contractors and financial institutions proposed

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<PAGE>
to be involved in the Omagine Project, (iii) arranging the
appropriate and required legal, accounting, tax and other
professional services both in Oman and the U.S., (iv) examining
various tax structures, (v) reviewing and complying (to the
extent we are presently able) with the listing requirements of
various stock exchanges so we may be prepared to apply for such
listing(s) subsequent to the Financing Agreement Date, (vi)
examining various other matters we believe will enhance
shareholder value subsequent to the Financing Agreement Date
(including but not limited to hiring an in-house Investor
Relations manager to enhance our presently modest shareholder
relations efforts), and (vii) examining other potential Company
revenue streams which are ancillary to, and derivative of, the
Omagine Project.

The present nature of the Company's business is such that it is
not expected to generate revenue until after the occurrence of
an event - the signing of the Development Agreement for the
Omagine Project - which, as of the date hereof, has not yet
occurred. Moreover, revenue from real estate development
associated with the Omagine Project is not expected to occur
until subsequent to the Financing Agreement Date. The Company is
planning to enter businesses other than real estate development
- and ancillary to the Omagine Project - subsequent to signing
the Development Agreement and expects to generate ongoing
revenue streams from such businesses, but no projections of the
amount of such revenue, if any, can be made at this time.

Notwithstanding the positive nature of the foregoing "forward
looking statements", no assurances can be given at this time
that the Shareholder Agreement or the Development Agreement will
actually be signed or that the Financing Agreement Date or the
anticipated revenues from the Omagine Project will actually
occur.

All "forward looking statements" contained herein are subject
to, known and unknown risks, uncertainties and other factors
which could cause Omagine LLC's, and therefore the Company's,
actual results, financial or operating performance or
achievements to differ from management's projections for them as
expressed or implied by such forward-looking statements.

Projections and assumptions contained and expressed herein are
based on information available to the Company at the time so

                              (32)

<PAGE>

furnished and as of the date hereof and are, in the opinion of
management, reasonable. All such projections and assumptions are
subject to significant uncertainties and contingencies, many of
which are beyond the Company's control, and no assurances can be
given that the projections will be realized. Potential investors
are cautioned not to place undue reliance on any such forward-
looking statements, which speak only as of the date hereof.

The Company's website is www.omagine.com and a dedicated
investor relations hub for Omagine, Inc. may be found at
www.agoracom.com/IR/Omagine.




RESULTS OF OPERATIONS:

THREE MONTHS ENDED MARCH 31, 2011 vs.
THREE MONTHS ENDED MARCH 31, 2010

The Company had no revenue in the first quarter of 2011 and
2010.

Selling, general and administrative expenses were $332,315 in
the first quarter of 2011, compared to $306,152 in the first
quarter of 2010. This increase of $26,163 (9%) was attributable
to decreased stock option expense of $4,386, decreased insurance
fees of $2,440, decreased stockholder relations of $7,511 and
other decreases totaling $2,353, offset by increased consulting
fees of $16,805,increased fringe benefits of $2,572,increased
accounting fees of $5,850, increased legal fees of $10,492 and
increased travel expense of $7,134.

The Company experienced an operating loss of $332,315 during
the first quarter of 2011 as compared to an operating loss of
$306,152 during the same period in the previous fiscal year.
This $26,163 (9%) increase in the Company's operating loss is
attributable to increases in general and administrative costs as
discussed in the preceding paragraph.

The Company will need to generate revenue in order to attain
profitability. The present nature of the Company's business is

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<PAGE>

such that it is not expected to generate revenue until after the
development of the Omagine Project is significantly underway, an
event which, as of the date hereof, is not certain to occur.

The Company will need to raise additional capital and/or secure
additional financing in order to execute its presently conceived
business plan with respect to the Omagine Project.

No capital expenditures were incurred during the quarterly
period ended March 31, 2011. Depending upon the outcome of
current negotiations and the availability of resources, the
Company may incur significant expenses related to capital
expenditures in the future.

LIQUIDITY AND CAPITAL RESOURCES:

The Company's net loss for the three months ended March 31, 2011
was $345,642. During the three months ended March 31, 2011, the
Company experienced a decrease in cash of $46,574. At March 31,
2011, the Company had a working capital deficit of $1,434,935,
compared to working capital deficit of $1,367,603 at December
31, 2010. The $67,332 increased deficit in working capital is
attributable primarily to the $46,574 decrease in cash, the
$52,500 increase in accrued officers' payroll, and a $38,566
decrease in accounts payable. Of the $1,547,315 of current
liabilities at March 31, 2011, $960,854 (62%) represent amounts
due to officers and directors.

The failure of the Company to secure additional funding to
implement its business plan, or the failure to sign the
Development Agreement for the Omagine Project will significantly
affect the Company's ability to continue operations.

On December 22, 2008, the Company signed a two year Standby
Equity Distribution Agreement (the "SEDA") with YA Global
Investments, L.P. ("YA"). The SEDA expired on April 30, 2011.
Pursuant to the SEDA Omagine could, at its sole option and upon
giving written notice to YA (a "Purchase Notice"), sell shares
of its Common Stock ("Shares") to YA ("Sales") at the Purchase
Price (as determined pursuant to the terms of the SEDA). The
Company was not obligated to sell any Shares to YA but could, in
its sole discretion, sell that number of Shares valued at the
Purchase Price from time to time in effect that equals five

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<PAGE>

million dollars ($5,000,000)in the aggregate. YA was obligated
to purchase such Shares from the Company subject to certain
conditions including (i) Omagine filing a Registration Statement
with the SEC to register the Shares, (ii) the SEC declaring such
Registration Statement effective, (iii) periodic sales of Shares
to YA had to be separated by a time period equal to five trading
days, and (iv) the amount of any such individual periodic sale
of Shares could not exceed two hundred thousand dollars
($200,000). The Registration Statement filed by the Company with
the SEC was declared effective by the SEC as of May 1, 2009 and
its effective status expired on April 30, 2010. The Company
filed a new Registration Statement with the SEC to continue to
make sales available to it pursuant to the SEDA and the SEC
declared such new Registration Statement to be effective as of
June 7, 2010. The SEDA expired on April 30, 2011 and the SEC
effective status expired subsequent to April 30, 2011. All sales
of Shares pursuant to the SEDA were made at the sole discretion
of the Company.

On May 4, 2011, The Company executed a new two year SEDA (the
"New SEDA") with YA Global Master SPV Ltd ("YA Ltd") under
substantially the same terms and conditions as the SEDA executed
between YA and the Company in December 2008. YA Ltd's obligation
to purchase shares of Common Stock under the New SEDA is subject
to certain conditions, including (i) Omagine obtaining an
effective registration statement for shares of Common Stock sold
under the SEDA ("Registration Statement") and (ii) the amount
for each equity tranche designated by Omagine to be no greater
than the greater of (i) two hundred thousand dollars ($200,000)
or (ii) an amount calculated by multiplying the daily trading
volume of the Company's Common Stock by the bid price for such
Common Stock for each of the five trading days prior to the day
that the Company delivers written notice to YA Ltd of its
intended equity tranche and then averaging such five amounts.

The Company intends to file a Registration Statement in
connection with the New SEDA as soon as possible. The Company
cannot sell shares of its Common Stock to YA Ltd under the New
SEDA until the SEC declares effective the Registration Statement
to be filed by the Company. There can be no assurance given at
this time that such Registration Statement will be declared
effective or that the Company will be able to raise or secure
the significant amounts of financing necessary for it to execute

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<PAGE>

its presently conceived business plan. The Company intends to
utilize the New SEDA to fund its operations as necessary and to
fund the OMAG Final Investment into Omagine LLC.


ITEM 4:  DISCLOSURE CONTROLS AND PROCEDURES

The Company carried out an evaluation under the supervision and
participation of management, including the Company's chief
executive and financial officer, of the effectiveness as of the
end of the period covered by this report of the design and
operation of the Company's disclosure controls and procedures
that are designed to ensure that information required to be
disclosed by the Company in this report is recorded, processed,
summarized and reported, within the time periods specified in
the SEC's rules and forms (an "Evaluation"). Disclosure controls
and procedures include, without limitation, controls and
procedures designed to ensure that information required to be
disclosed by the Company in this report is accumulated and
communicated to the Company's management, including its
principal executive and principal financial officers, or persons
performing similar functions, as appropriate to allow timely
decisions regarding required disclosure.

Based upon that Evaluation, the Company's chief executive and
financial officer concluded that the Company's disclosure
controls and procedures were effective as of March 31, 2011.
The Evaluation did not identify the occurrence of any change in
the Company's internal control over financial reporting during
the first quarter of fiscal 2011 that materially affected or is
reasonably likely to materially affect, the Company's internal
control over financial reporting.

The Company is a non-accelerated filer and is required to comply
with the internal control reporting and disclosure requirements
of Sections 404 and 302 of the Sarbanes-Oxley Act for fiscal
years ending on or after December 15, 2007.

The Company adopted and is presently utilizing a web-based
software solution provided by an unaffiliated third party to
automate and streamline its Sarbanes-Oxley compliance program.

The product enables the Company to document and assess the

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<PAGE>

design of controls, track the testing of their effectiveness and
easily locate and remedy any deficiencies. The Company pays an
annual fee for unlimited access to the web-based platform (the
"Agreement"). The Agreement automatically renews each February
for subsequent one year periods, unless the Company notifies the
software supplier of its intention not to renew such Agreement.

There have been no significant changes in the Company's internal
controls or other factors which could significantly affect
internal controls subsequent to the date of the Evaluation.

ITEM 4T:  CONTROLS AND PROCEDURES

This report does not include an attestation report of the
Company's registered public accounting firm regarding internal
control over financial reporting. Management's report was not
subject to attestation by the Company's registered public
accounting firm pursuant to temporary rules of the Securities
and Exchange Commission that permit the Company to provide only
management's report in this report.


                    PART II   -   OTHER INFORMATION


ITEM 2.    Unregistered Sales of Equity Securities and Use
           of Proceeds


During the three months ended March 31, 2011, the Company
sold 57,018 shares of Common Stock to one accredited investor
for proceeds of $50,000 pursuant to two Subscription Agreements.

The above sales of shares of our restricted Common Stock were
made in reliance upon the exemption from registration contained
in Section 4(2) under the Securities Act of 1933 as amended (the
"Act"), and under similar exemptions afforded under the laws of
various states only to "accredited investors" as that term is
defined in Rule 501 of Regulation D promulgated by the SEC under
the Act. The Company obtained representations and warranties
from the purchaser in his Subscription Agreements to support the
Company's reliance on this exemption.

The Company intends to use the proceeds from the abovementioned

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<PAGE>

sales of restricted stock for working capital, operating
expenses and general corporate purposes.

ITEM 6.    Exhibits

        Exhibits numbered in accordance with Item 601(a) of
           Regulation S-K

Exhibit
Numbers           Description
-------           -----------

3(i) a            Restated Certificate of Incorporation of the
                  Company (2)

3(ii)             By-laws of the Company (1)

31.1              Sarbannes-Oxley 302 certification *

32.2              Sarbannes-Oxley 1350 certification *

       * Filed herewith

(1)  Previously filed with the Securities and Exchange
Commission on November 18, 2005 as an exhibit to the Company's
quarterly report on Form 10-QSB for the period ended September
30, 2005 and incorporated herein by reference thereto.

(2)  Previously filed with the Securities and Exchange
Commission on July 20, 2010 as an exhibit to the Company's
quarterly report on Form 10-Q for the period ended June 30, 2010
and incorporated herein by reference thereto.











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<PAGE>

                       SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.



DATED: May 16, 2011            OMAGINE, INC.
                               (Registrant)


                              By: /s/ Frank J. Drohan
                              -------------------------
                                FRANK J. DROHAN, Chairman
                                of the Board of Directors,
                                President and Chief
                                Executive and Financial Officer
                                (Principal Executive Officer and
                                Principal Financial Officer)



                              By: /s/ William Hanley
                              -------------------------
                                  WILLIAM HANLEY
                                  Controller and Principal
                                  Accounting Officer



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