<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>cabel10q063006.txt
<TEXT>

================================================================================

                                    FORM 10-Q
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


              |X| QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                       FOR THE QUARTER ENDED JUNE 30, 2006
                                       or
          |_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                        FOR THE TRANSITION PERIOD FROM TO

                        Commission File Number 000-08187
                       CABELTEL INTERNATIONAL CORPORATION
             (Exact Name of Registrant as Specified in Its Charter)

             Nevada                                               75-2399477
-------------------------------                              -------------------
(State or Other Jurisdiction of                               (I.R.S. Employer
 Incorporation or Organization)                              Identification No.)

                        1755 Wittington Place, Suite 340
                                  Dallas, Texas
                 ----------------------------------------------
                    (Address of principal executive offices)

                                      75234
                 ----------------------------------------------
                                   (Zip Code)

                          (972) 407-8400 (Registrant's
                           telephone number, including
                                   area code)

                 ----------------------------------------------
                     (Former name, former address and former
                   fiscal year, if changed since last report)

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. Yes |X|. No |_|.

Indicate  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the Act). Yes |_|. No |X|.

Indicate by check mark whether the registrant is a large  accelerated  filer, an
accelerated  filer or a  non-accelerated  filer.  See  definition of accelerated
filer in Rule 12b-2 of the Exchange Act (Check one): Large accelerated filer |_|
Accelerated filer |_| Non-accelerated filer |X|

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

    APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE
                              PRECEDING FIVE YEARS:

Indicate  by check mark  whether  the  registrant  has filed all  documents  and
reports  required  to be filed by  Sections  12,  13 or 15(d) of the  Securities
Exchange Act of 1934 subsequent to the  distribution of securities  under a plan
confirmed by a court. Yes |_|. No |_|.

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
Common Stock, as of the latest practicable date.

     Common Stock, $.01 par value                        976,955
               (Class)                       (Outstanding at June 30, 2006)

================================================================================

<PAGE>

                       CABELTEL INTERNATIONAL CORPORATION
                     Index to Quarterly Report on Form 10-Q
                           Period ended June 30, 2006


PART I: FINANCIAL INFORMATION..................................................3

   Item 1:  Financial Statements...............................................3
      Consolidated Balance Sheets..............................................3
      Consolidated Statements of Operations....................................5
      Consolidated Statements of Cash Flow.....................................6
      Notes To Consolidated Financial Statements...............................7

   Item 2:  Management's Discussion And Analysis Of Financial Condition
            And Results Of Operations.........................................14

   Item 3.  Quantitative and Qualitative Disclosures About Market Risk........16

   Item 4.  Controls and Procedures...........................................16

PART II: OTHER INFORMATION....................................................17


   Item 2. Unregistered Sales of Equity Securities and Use of Proceeds........17

   Item 6. Exhibits...........................................................17

   Signatures.................................................................19















                                       2
<PAGE>
<TABLE>
<CAPTION>

                          Part I: Financial Information

ITEM 1:   FINANCIAL STATEMENTS
------------------------------

The accompanying  Consolidated Financial Statements as of and for the six months
ended  June 30,  2006 have not been  audited  by  independent  certified  public
accountants  but, in the  opinion of the  management  of CableTel  International
Corporation  ("CabelTel"  or the  "Company"  or  "CIC"  or  "we" or  "us"),  all
adjustments  (consisting  of normal  recurring  accruals)  necessary  for a fair
presentation of CIC's consolidated  financial position,  consolidated results of
operations  and  consolidated  cash  flows  at the  dates  and for  the  periods
indicated, have been included.


                       CabelTel International Corporation
                           Consolidated Balance Sheets
                             (Amounts in thousands)

                                                              June 30,     December 31,
Assets                                                          2006           2005
                                                            (Unaudited)
                                                            ------------   ------------
<S>                                                         <C>            <C>
Current assets
         Cash and cash equivalents                          $        332   $        650
         Accounts receivable-trade                                   240            339
         Note receivable                                               6            306
         Other current assets                                      1,838            179
                                                            ------------   ------------

                  Total current assets                             2,416          1,474

Notes receivable net of deferred income                            1,809            309

Property and equipment, at cost
         Land and improvements                                     2,232          2,232
         Buildings and improvements                                5,304          5,298
         Equipment and furnishings                                   302            292
         Proven oil and gas properties (full cost method)           --            1,401
                                                            ------------   ------------
                                                                   7,838          9,223
                   Less accumulated depreciation and
                           depletion                                 835            963
                                                            ------------   ------------
                                                                   7,003          8,260

Deferred tax asset                                                   831          1,161

Due from CableTEL AD - related party                                --            8,004

Other assets                                                         854            872
                                                            ------------   ------------

                                                            $     12,913        $20,080
                                                            ============   ============
</TABLE>





        The accompanying notes are an integral part of these statements.


                                       3
<PAGE>
<TABLE>
<CAPTION>

                       CabelTel International Corporation
                           Consolidated Balance Sheets
                             (Amounts in thousands)

                                                        June 30,        December 31,
Liabilities and Stockholders' equity                      2006            2005
                                                      (Unaudited)
                                                      ------------    ------------
<S>                                                   <C>             <C>
Current liabilities
         Current maturities of long-term debt         $      2,486    $      2,383
         Accounts payable - trade                              547             842
         Accrued expenses                                    1,154           1,236
         Other current liabilities                             414             371
                                                      ------------    ------------

                  Total current liabilities                  4,601           4,832

Long-term debt                                               6,147          13,560

Other long term liabilities                                    193             936
                                                      ------------    ------------

                  Total liabilities                         10,941          19,328

Stockholders' equity
         Preferred stock, Series B                               1               1
         Preferred stock, Series J 2%                         --             3,150
         Preferred stock, Series J 2% contra equity           --            (3,150)
         Common stock $.01 par value; authorized,
                  4,000,000 shares; 976,955 shares
                  issued and outstanding                        10              10
         Additional paid-in capital                         55,966          55,966
         Accumulated deficit                               (54,005)        (55,225)
                                                      ------------    ------------

                                                             1,972             752
                                                      ------------    ------------

                                                      $     12,913    $     20,080
                                                      ============    ============
</TABLE>




        The accompanying notes are an integral part of these statements.


                                       4
<PAGE>
<TABLE>
<CAPTION>

                       CabelTel International Corporation
                      Consolidated Statements of Operations
                  (Amounts in thousands, except per share data)

                                                For The Three Month      For The Six Month
                                                    Period Ended            Period Ended
                                                       June 30,                June 30,
                                                 2006        2005        2006        2005
                                                -------     -------     -------     -------
<S>                                             <C>         <C>         <C>         <C>
                                                    (Unaudited)             (Unaudited)
Revenue
         Real estate operations                 $ 1,072     $ 1,136     $ 2,222     $ 2,236
         Oil and gas operations                     541         396         995         810
                                                -------     -------     -------     -------
                                                  1,613       1,532       3,217       3,046
                                                -------     -------     -------     -------

Operating expenses
         Real estate operations                     704         770       1,561       1,457
         Oil and gas operations                     374         319         726         612
         Lease expense                              238         231         474         462
         Corporate general and administrative       249         268         563         532
                                                -------     -------     -------     -------
                                                  1,565       1,588       3,324       3,063
                                                -------     -------     -------     -------

                  Operating earnings (loss)          48         (56)       (107)        (17)

Other income (expense)
         Interest income                              5          28         322          68
         Interest expense                          (155)       (133)       (615)       (268)
         Net gain (loss) on sale of assets          418        --           418        (118)
         Other                                    1,531          18       1,532          50
                                                -------     -------     -------     -------
                                                  1,799         (87)      1,657        (268)
                                                -------     -------     -------     -------

Income (loss) from continuing operations          1,847        (143)      1,550        (285)

(Loss) from discontinued operations                --           (17)       --           (12)

Provision for income taxes                          330        --           330        --

Net income (loss) applicable to common shares   $ 1,517     $  (160)    $ 1,220     $  (297)

 Earnings (loss) per share - basic
     Continuing operations                         1.55     $ (0.15)    $  1.25     $ (0.29)
     Discontinued operations                       --         (0.01)       --         (0.01)
                                                -------     -------     -------     -------
     Net loss per share                         $  1.55     $ (0.16)    $  1.25     $ (0.30)
                                                -------     -------     -------     -------

Basic weighted average common shares                977         977         977         977
</TABLE>




        The accompanying notes are an integral part of these statements.


                                       5
<PAGE>
<TABLE>
<CAPTION>

                       CabelTel International Corporation
                      Consolidated Statements of Cash Flow
                             (Amounts in thousands)

                                                                                For the six month
                                                                              Period Ended June 30,
                                                                                2006           2005
                                                                            -----------    -----------
<S>                                                                         <C>            <C>
                                                                            (Unaudited)    (Unaudited)
Cash flows from operating activities
         Net income (loss)                                                  $     1,220    $      (297)
         Adjustments to reconcile net income (loss) to net
                  cash used in operating activities
         Depreciation, depletion and amortization                                   262            247
         (Gain) loss on sale of asset                                              (418)           118
         (Gain) from affiliate                                                    (1,500)          --

         Changes in operating assets and liabilities
                  Accounts receivable                                                99           (137)
                  Interest receivable                                              (232)          --
                  Other current and non current assets                              341         (1,043)
                  Accounts payable and other liabilities                           (311)           790
                                                                            -----------    -----------

                           Net cash used in operating activities                   (539)          (322)

Cash flows provided by (used in) investing activities
         Repayment of notes receivable                                              300          3,307
         Purchase of property and equipment, net                                    (16)           (33)
                                                                            -----------    -----------

                           Net cash provided by investing activities                284          3,274

Cash flows from financing activities
         Net advances from affiliates                                              --              453
         Payments on debt                                                           (63)        (3,775)
                                                                            -----------    -----------

                                    Net cash used in financing activities           (63)        (3,322)

                                    Net decrease in cash and cash                  (318)          (370)
equivalents

         Cash and cash equivalents at beginning of period                           650            767
                                                                            -----------    -----------

         Cash and cash equivalents at end of period                         $       332    $       397

Non-cash:
Sale of Gaywood receivable                                                  $     1,737
Notes payable dissolved under rescission                                    $     7,245
Interest payable dissolved under rescission                                 $       900
Funds due from affiliate dissolved under rescission                         $     8,236
Note receivable funded under rescission                                     $     1,500
</TABLE>




        The accompanying notes are an integral part of these statements.


                                       6
<PAGE>

                   Notes To Consolidated Financial Statements
            For the Unaudited Six Months Ended June 30, 2006 and 2005

Note A: Basis of Presentation

The  accompanying  unaudited,  consolidated  financial  statements  include  the
accounts  of  CabelTel   International   Corporation   and  its   majority-owned
subsidiaries   (collectively,   "CIC"  or  the   "Company").   All   significant
intercompany transactions and accounts have been eliminated.

The financial  statements  reflect all  adjustments  that are, in the opinion of
management,  necessary to fairly present such information.  All such adjustments
are of a  normal  recurring  nature.  Although  the  Company  believes  that the
disclosures  are  adequate to make the  information  presented  not  misleading,
certain  information  and  footnote  disclosures,  including  a  description  of
significant  accounting  policies  normally  included  in  financial  statements
prepared in accordance  with  accounting  principles  generally  accepted in the
United States of America,  have been condensed or omitted pursuant to such rules
and regulations.

These financial  statements  should be read in conjunction with the consolidated
financial  statements and  accompanying  notes included in the Company's  Annual
Report on Form 10-K,  as amended,  for the fiscal year ended  December 31, 2005.
Operating  results for the three and six month  periods  ended June 30, 2006 are
not  necessarily  indicative  of the  results  that  may  be  expected  for  any
subsequent quarter or the year ending December 31, 2006.



Note B: Rescission of CabelTEL AD, Bulgaria Acquisition

On October 12, 2004, the Company acquired, for 31,500 shares of newly-designated
2% Series J Preferred  Stock,  74.8% of CableTEL  AD  ("CableTEL"),  a Bulgarian
telecommunications  company. The terms of the acquisition  agreement require the
Company to present a  proposal  to its  stockholders  to approve  the  mandatory
exchange  of all shares of Series J  Preferred  Stock into  8,788,500  shares of
common stock which,  if approved by  stockholders,  would  represent  90% of the
resulting total issued and outstanding shares of common stock in the Company.

The acquisition  agreement,  as amended,  provided that the  stockholders of the
Company had until June 30,  2006 to approve  the  exchange of Series J Preferred
Stock into the Company  common  stock.  If the exchange was not approved by June
30, 2006, the holders of the Series J Preferred  Stock had the option to rescind
the entire transaction.

Until the  acquisition  was completed,  the financial  statements of CableTEL AD
were not  included  in the  Company's  consolidated  financial  statements.  The
financial  statements of the Company did reflect the Series J Preferred Stock as
well as a contra equity  account  reflecting  that the  transaction  had not yet
occurred.

Effective  June 1, 2006 the Company and the owners of CableTEL AD entered into a
Rescission  Agreement whereby the original  Acquisition  Agreement dated October
12, 2004, plus all amendments, was rescinded in its entirety.


                                       7
<PAGE>

Pursuant to the Rescission Agreement:

(a) The Company cancelled the 31,500 shares of Series J 2% Cumulative  Preferred
Stock it issued.

(b) The Company returned all entities it had acquired on October 12, 2004 to the
original owners.

(c) A corporation  affiliated with one of the original  sellers assumed from the
Company  all  indebtedness  incurred  by the  Company  since  October 1, 2004 in
connection  with or related to  advances  by the  Company to  CableTEL AD or its
affiliates  to fund the  operation  of  CableTEL  AD. In  exchange  the  Company
surrendered  all  claims  it  had  against  CableTel  AD or its  affiliates  for
reimbursement for such advances.

(d) Ronald C.  Finley,  Chief  Executive  Officer of  CableTEL AD and one of the
original  sellers  resigned  his  positions  in the  Company as a  director,  as
Chairman  of the Board  and as Chief  Executive  Officer.  His  resignation  was
effective June 1, 2006.

(e) The Company  agreed  that,  subject to its  compliance  with all  applicable
American Stock Exchange, Inc. rules and federal securities laws, it would in the
future  change  its name to a name that does not  include  the word  "cable"  or
"cabel".

(f)  An  affiliate  of  one  of  the  original   sellers   assumed  control  and
responsibility  of any and all litigation  involving the Company or in which the
Company  is named  as a party  involving  the  Company's  relationship  with the
parties to the Rescission Agreement and/or CableTEL AD.

(g) All of the  parties  agreed to pay their own  expenses  with  respect to any
costs associated with the Rescission Agreement.

(h) The  Company,  as a "break  up  fee",  received,  from  one of the  original
sellers, a $1,500,000  participation in a 9 1/2% tax free bond. The bond, with a
total face value of $2,406,850,  is from an unrelated  third party.  The Company
recorded, as other income, in June 2006 the $1,500,000, net of expenses.

Note C: Sale of Gaywood Oil & Gas

Effective June 30, 2006, the Company sold all of its membership interests in the
two limited liability companies Gaywood Oil & Gas, LLC and Gaywood Oil & Gas II,
LLC which own oil and gas leases in Gregg and Rusk Counties,  Texas and on which
approximately  50  oil-producing  wells are operating.  These are low production
wells  averaging  two to  three  barrels  of oil per  day.  The  sale  price  of
$1,737,000 was received in cash on July 5, 2006. The Company  recorded a gain on
the sale of $418,000.


Note D: Notes Receivable

As a result of the sale of two properties in 2001, the Company holds  tax-exempt
notes in the amount of $4,030,000, bearing interest at 9.5%. The notes mature on
April 1, 2032, and August 1, 2031, respectively.  The repayment of the notes and
interest thereon is limited to the cash flow of the respective properties either
from  operations,  refinancing  or sale.  The Company has deferred  gains in the
amount of $3,721,000 as well as unpaid interest which will be recognized as cash
is received.

As a result of the  CableTEL  AD  rescission,  the  Company  holds a  $1,500,000
participation  in a tax-exempt  note with a face amount of  $2,406,000,  bearing
interest at 9.5%.  The note  matures on August 20,  2037.  The  repayment of the


                                       8
<PAGE>
<TABLE>
<CAPTION>

notes and interest  thereon is limited to the cash flow of the  property  either
from operations, refinancing or sale.

Note E:  Long-Term Obligations

Long-term debt is comprised of the following (in thousands):
                                                                         June 30,     December 31,
                                                                           2006           2005
                                                                       ------------   ------------
<S>                                                                    <C>            <C>
Note payable to a financial institution maturing in
August 2009, with a fixed interest rate of 5.75%
collateralized by property, fixtures, equipment and an
assignment of rents                                                    $      6,278   $      6,341

Note payable to an individual with a fixed interest rate of 10%               2,255          2,255

Notes payable to related parties, bearing interest at rates from 15%
to 18%                                                                          100          7,347

                                                                       ------------   ------------
                                                                              8,633         15,943

Less: current maturities                                                      2,486          2,383
                                                                       ------------   ------------
                                                                       $      6,147   $     13,560
</TABLE>

Note F: Discontinued Operations

The Company owned an assisted living property in Greenville,  South Carolina. In
August 2002,  the Company  leased the  property to an unrelated  third party who
then operated the property.  The monthly lease payments  received by the Company
approximated the Company's cost for interest and real estate taxes. In May 2005,
the  Company  sold the  property  to the lessee  for the amount of the  existing
mortgage on the property,  which  approximated the Company's  carrying value for
the property.

On January 31,  2004,  the  Company  terminated  a lease for an assisted  living
community in Georgia.  The  operations of that property have been reflected as a
discontinued operation in 2005.

In March 2005,  the Company sold an assisted  living  facility in North Carolina
and  recorded a loss of  $42,000.  The  operations  of that  property  have been
reflected as a discontinued operation in 2005.

In May 2005, the Company sold an assisted living facility in South Carolina. The
operations of that property have been reflected as a  discontinued  operation in
2005.


                                       9
<PAGE>

Note G: Segment Reporting

Business Operations

On June 30, 2006 the Company operated two separate distinct businesses

     o    The operation of real estate through one retirement  community in King
          City, Oregon, with a capacity of 114 residents,  and the ownership and
          operation of an outlet mall in Gainesville,  Texas, with approximately
          315,000 square feet of retail space available for lease.

     o    The ownership of oil and gas leases in Gregg and Rusk Counties, Texas,
          on which  approximately  50 producing  wells were operating as of June
          30, 2006. This oil and gas operation was sold effective June 30, 2006.




















                                       10
<PAGE>
<TABLE>
<CAPTION>

Certain 2005 and 2006 amounts have been  reclassified  to conform to the current
presentation . The segment  information and reconciliation to income (loss) from
operations are as follows:

Three months ended June 30, 2006 (amounts in thousands)

                                                                             Real            Oil         Consolidated
                                                          Corporate         Estate        Operation           CIC
                                                         ------------    ------------    ------------    ------------
<S>                                                      <C>             <C>             <C>             <C>
Revenue                                                  $       --      $      1,072    $        541    $      1,613

Operating expenses
       Operations                                                --               704             374           1,078
       Lease expense                                               29             209            --               238
       Corporate general and administrative                       249            --              --               249
                                                         ------------    ------------    ------------    ------------
                                                                  278             913             374           1,565
                                                         ------------    ------------    ------------    ------------

Operating earnings (loss)                                        (278)            159             167              48

Interest income                                                     5            --              --                 5
Interest (expense)                                                (56)            (93)             (6)           (155)
Other
                                                                1,531            --              --             1,531

Net earnings (loss) from continuing operations
                                                                1,676              11             160           1,847

Total assets                                             $      4,760    $      8,153    $       --      $     12,913

Six months ended June 30, 2006 (amounts in thousands):

                                                                             Real            Oil         Consolidated
                                                          Corporate         Estate        Operation           CIC
                                                         ------------    ------------    ------------    ------------
                                                         ------------    ------------    ------------    ------------
Revenue                                                  $       --      $      2,222    $        995    $      3,217
                                                         ------------    ------------    ------------    ------------

Operating expenses
       Operations                                                --             1,561             726           2,287
       Lease expense                                               51             423            --               474
       Corporate general and administrative                       563            --              --               563
                                                         ------------    ------------    ------------    ------------
                                                                  614           1,984             726           3,324
                                                         ------------    ------------    ------------    ------------

Operating earnings (loss)                                        (614)            238             269            (107)

Interest income                                                   322            --              --               322
Interest (expense)                                               (419)           (186)            (10)           (615)
Other                                                           1,531            --              --             1,531

Net earnings (loss) from continuing operations                  1,377             (85)            257           1,549

Total assets                                             $      4,760    $      8,153    $       --      $     12,913
</TABLE>



                                       11
<PAGE>
<TABLE>
<CAPTION>

Note G: Segment Reporting - Continued


Three months ended June 30, 2005 (amounts in thousands):

                                                                             Real            Oil         Consolidated
                                                          Corporate         Estate        Operation           CIC
                                                         ------------    ------------    ------------    ------------
<S>                                                      <C>             <C>             <C>             <C>
Revenue
                                                         $       --      $      1,136    $        396    $      1,532

Operating expenses
       Operations                                                --               770             319           1,089
       Lease expense                                               19             212            --               231
       Corporate general and administrative                       268            --              --               268
                                                         ------------    ------------    ------------    ------------
                                                                  287             982             319           1,588
                                                         ------------    ------------    ------------    ------------

Operating earnings (loss)                                        (287)            154              77             (56)

Interest income                                                    28            --              --                28
Interest (expense)                                                (59)            (74)           --              (133)
Loss on sale of assets                                           --              --              --              --
Other                                                              18            --              --                18
Net earnings (loss) from continuing operations                   (258)             38              77            (143)


Total assets                                             $      5,680    $      8,740    $      1,781    $     16,201


Six months ended June 30, 2005 (amounts in thousands):

                                                                             Real            Oil         Consolidated
                                                          Corporate         Estate        Operation           CIC
                                                         ------------    ------------    ------------    ------------

Revenue                                                  $       --      $      2,236    $        810    $      3,046

Operating expenses
       Operations                                                --             1,457             612           1,826
       Lease expense                                               39             423            --               462
       Corporate general and administrative                       532            --              --               528
                                                         ------------    ------------    ------------    ------------
                                                                  571           1,880             612           3,063
                                                         ------------    ------------    ------------    ------------

Operating earnings (loss)                                        (571)            356             198             (17)

Interest income                                                    68            --              --                68
Interest (expense)                                               (113)           (155)           --              (268)
Loss on sale of assets                                           --               (42)            (76)           (118)
Other                                                              50            --              --                50
Net earnings (loss) from continuing operations                   (566)            159             122            (285)

Total assets                                             $      5,680    $      8,740    $      1,781    $     16,201
</TABLE>



                                       12
<PAGE>

WARNING CONCERNING FORWARD-LOOKING STATEMENTS

The  following  discussion  should  be read in  conjunction  with the  financial
statements and notes thereto appearing elsewhere in this report.

This  Report on Form 10-Q may  contain  forward-looking  statements  within  the
meaning of the federal  securities  laws,  principally,  but not only, under the
caption  "Management's  Discussion  and  Analysis of  Financial  Condition"  and
"Results  of  Operations."  We  caution   investors  that  any   forward-looking
statements  in this report,  or which  management  may make orally or in writing
from time to time, are based on management's beliefs and on assumptions made by,
and  information  currently  available  to,  management.  When  used,  the words
"anticipate," "believe," "expect," "intend," "may," "might," "plan," "estimate,"
"project,"  "should,"  "will,"  "result"  and similar  expressions  which do not
relate  solely to  historical  matters are intended to identify  forward-looking
statements.   These  statements  are  subject  to  risks,   uncertainties,   and
assumptions and are not guarantees of future performance,  which may be affected
by known and unknown risks, trends, uncertainties,  and factors, that are beyond
our control. Should one or more of these risks or uncertainties materialize,  or
should  underlying   assumptions  prove  incorrect,   actual  results  may  vary
materially from those anticipated, estimated, or projected. We caution you that,
while  forward-looking  statements  reflect our good faith  beliefs when we make
them,  they are not guarantees of future  performance and are impacted by actual
events when they occur after we make such statements.  We expressly disclaim any
responsibility to update our forward-looking statements,  whether as a result of
new information, future events or otherwise.  Accordingly,  investors should use
caution  in  relying  on past  forward-looking  statements,  which  are based on
results and trends at the time they are made,  to anticipate  future  results or
trends.

Some  of the  risks  and  uncertainties  that  may  cause  our  actual  results,
performance or achievements to differ materially from those expressed or implied
by  forward-looking  statements  include,  among others,  the factors listed and
described at Item 1A "Risk Factors" in the Company's Annual Report on Form 10-K,
which investors should review.  There have been no changes from the risk factors
previously  described  in the  Company's  Form 10-K for the  fiscal  year  ended
December 31, 2005.

Other  sections of this report may also  include  suggested  factors  that could
adversely affect our business and financial performance. Moreover, we operate in
a very competitive and rapidly changing environment.  New risks emerge from time
to time and it is not possible for  management to predict all such matters;  nor
can we assess the impact of all such  matters on our  business  or the extent to
which any factor, or combination of factors,  may cause actual results to differ
materially from those contained in any forward-looking  statements.  Given these
uncertainties,  investors  should not place undue  reliance  on  forward-looking
statements as a prediction of actual results. Investors should also refer to our
quarterly  reports on Form 10-Q for future  periods and current  reports on Form
8-K as we file them with the SEC,  and to other  materials we may furnish to the
public from time to time through Forms 8-K or otherwise.


                                       13
<PAGE>

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

Overview

Critical Accounting Policies and Estimates

The Company's  discussion and analysis of its financial condition and results of
operations are based upon the Company's Consolidated Financial Statements, which
have been prepared in accordance with accounting  principles  generally accepted
in the United States.  Certain of the Company's  accounting policies require the
application of judgment in selecting the appropriate assumptions for calculating
financial estimates. By their nature, these judgments are subject to an inherent
degree  of  uncertainty.  These  judgments  and  estimates  are  based  upon the
Company's historical  experience,  current trends and information available from
other sources that are believed to be reasonable  under the  circumstances,  the
results of which form the basis for making judgments about the carrying value of
assets and liabilities that are not readily apparent from other sources.  Actual
results  may  differ  from  these  estimates  under  different   assumptions  or
conditions.

The Company believes the following critical  accounting policies are significant
to the judgments  and  estimates  used in the  preparation  of its  consolidated
financial statements.  Revisions in such estimates are recorded in the period in
which the facts that give rise to the revisions become known.

The Company's allowance for doubtful accounts receivable and notes receivable is
based on an  analysis  of the risk of loss on specific  accounts.  The  analysis
places  particular  emphasis on past due  accounts.  Management  considers  such
information as the nature and age of the receivable,  the payment history of the
tenant,  customer or other debtor and the  financial  condition of the tenant or
other debtor. Management's estimate of the required allowance, which is reviewed
on a quarterly basis, is subject to revision as these factors change.

Deferred Tax Assets
Significant  management  judgment is required in  determining  the provision for
income taxes,  deferred tax assets and liabilities  and any valuation  allowance
recorded  against net  deferred  tax assets.  The future  recoverability  of the
Company's  net deferred tax assets is dependent  upon the  generation  of future
taxable income prior to the expiration of the loss carry  forwards.  The company
believes that it will generate  future  taxable  income to fully utilize the net
deferred tax assets.

Liquidity and Capital Resources
At June 30,  2006,  the Company had current  assets of $2.4  million and current
liabilities of $4.6 million. Included in current liabilities is an obligation of
principal and accrued  interest of $3.0 million,  the terms of which are similar
to that of preferred  stock whereby the Company can only pay this obligation out
of available earned surplus.

Cash and cash  equivalents  at June 30, 2006 were  $332,000,  as  compared  with
$650,000 at December 31, 2005.

Net cash used by operating activities was $539,000 for the six months ended June
30,  2006.  During  the six month  period  the  Company  had net  income of $1.2
million.

Net cash provided by investing  activities was $284,000 for the six months ended
June 30, 2006, due, primarily, to the collection of notes receivable.

Net cash flow used in financing  activities  was $63,000 in the six months ended
June 30, 2006.


                                       14
<PAGE>

Results of Operations
The Company  reported net income of $1,517,000  and $1,220,000 for the three and
six months  ended June 30,  2006,  as  compared  to a net loss of  $160,000  and
$297,000 for the three and six months ended June 30, 2005.

For the three and six months ended June 30, 2006, the Company recorded  revenues
of $1,072,000  and  $2,222,000  for its real estate  operations,  as compared to
$1,136,000  and $2,236,000 for the three and six months ended June 30, 2005. The
Company's  retirement  property is fully occupied and it is anticipated  that it
will remain so during 2006. The Company's retail shopping mall was approximately
60% occupied at June 30, 2006.

For the three and six months  ended June 30,  2006,  revenue for the oil and gas
operation  was $541,000 and  $995,000,  as compared to $396,000 and $810,000 for
the three and six months ended June 30, 2005.  The increase was due  principally
to the increase in the price of oil.

For the three and six months ended June 30, 2006, real estate operating expenses
were $704,000 and  $1,561,000,  as compared to $661,000 and  $1,267,000  for the
three and six months ended June 30, 2005.  The increase was due  principally  to
operating costs including promotional expenses for the Gainesville outlet mall.

For the three and six months ended June 30, 2006, operating expenses for the oil
and gas  operation  were  $374,000  and  $726,000,  as compared to $292,000  and
$559,000 for the three and six months ended June 30, 2005.  The increase was due
principally to well repairs incurred in 2006.

For the three and six months ended June 30, 2006, interest income was $5,000 and
$322,000,  as compared to $28,000 and $68,000 for the three and six months ended
June 30, 2005.  During the first quarter of 2006 the Company  incurred  interest
expense  on  borrowings  for funds  that were  transferred  to  CableTEL  AD for
operating expenses.

Interest  expense was  $155,000 and $615,000 for the three months and six months
ended June 30,  2006,  as compared to $133,000 and $268,000 for the three months
and six months ended June 30, 2005. During the first quarter of 2006 the Company
recorded  interest  income on loans to CableTEL  AD for  operating  expenses.  A
mitigating  factor that  reduced  interest  expense was the  refinancing  of the
Gainesville  outlet mall August 2005 which reduced  interest expense from 15% to
5.75%.

Gain on the sale of assets was  $418,000 for the three and six months ended June
30, 2006. On June 30, 2006 the Company sold Gaywood Oil and Gas.

Other income was $1,531,000 for the three and six months ended June 30, 2006, as
compared to $18,000 and $50,000 for the three  months and six months  ended June
30, 2005. The income in 2006 was due almost entirely to the company's rescinding
it's  acquisition  of CableTEL AD and recording a break up fee of $1,500,000 net
of expenses.

Inflation
The  Company's  principal  sources  of revenue  are from  rents in a  retirement
community,  an outlet shopping mall and,  through June 30, 2006, its oil and gas
operations.  The  operation  of the real  estate  entities is affected by rental
rates that are highly  dependent  upon  market  conditions  and the  competitive
environment  in the areas where the  properties  are  located.  Compensation  to
employees  and  maintenance  are the  principal  cost  elements  relative to the
operations  of  the  entities.   Although  the  Company  has  not   historically
experienced  any adverse  effects of  inflation  on salaries or other  operating
expenses,  there can be no  assurance  that such trends  will  continue or that,
should  inflationary  pressures  arise,  the Company will be able to offset such
costs by increasing rental rates in its real estate properties.


                                       15
<PAGE>

Environmental Matters
The Company has  conducted  environmental  assessments  on most of its  existing
owned  or  leased   properties.   These   assessments   have  not  revealed  any
environmental  liability that the Company believes would have a material adverse
effect on the Company's business,  assets or results of operations.  The Company
is not aware of any such environmental  liability. The Company believes that all
of its properties  are in compliance in all material  respects with all federal,
state and local laws,  ordinances and regulations  regarding  hazardous or toxic
substances  or  petroleum  products.  The Company  has not been  notified by any
governmental   authority   and  is  not   otherwise   aware   of  any   material
non-compliance,  liability or claim relating to hazardous or toxic substances or
petroleum products in connection with any of its communities.

ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
--------------------------------------------------------------------

Interest Rate Risk
All of the Company's debt is financed at fixed rates of interest.  Therefore, we
have minimal risk from exposure to changes in interest rates.


ITEM 4.   CONTROLS AND PROCEDURES
---------------------------------

As  required  by Rule  13(a)-15(b),  the  Company's  management,  including  the
principal  executive officer,  chief financial officer and principal  accounting
officer,  conducted an  evaluation  as of the end of the period  covered by this
report, of the effectiveness of the Company's disclosure controls and procedures
as defined in  Exchange  Act Rule  13(a)-15(e).  Based on that  evaluation,  the
president and chief financial  officer  concluded that the Company's  disclosure
controls and  procedures  were  effective as of the end of the period covered by
this  report.  As  required  by  Rule  13(a)-15(d),  the  Company's  management,
including the chief executive  officer,  chief  financial  officer and principal
accounting  officer,  also  conducted an evaluation  of the  Company's  internal
controls over financial  reporting to determine  whether any changes occurred in
the first fiscal quarter that materially  affected,  or are reasonably likely to
materially  effect,  the Company's  internal  control over financial  reporting.
Based on that evaluation,  there has been no such change during the first fiscal
quarter.

It should be noted  that any  system of  controls,  however  well  designed  and
operated,  can only  provide  reasonable  and not  absolute  assurance  that the
objectives  of the system  will be met. In  addition,  the design of any control
system is based in part on certain  assumptions  about the  likelihood of future
events.












                                       16
<PAGE>
<TABLE>
<CAPTION>

                           Part II: Other Information


ITEM 2.   UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
---------------------------------------------------------------------

During  the  period  of time  covered  by this  report,  CabelTel  International
Corporation did not repurchase any of its equity securities. The following table
sets forth a summary for the quarter,  indicating no  repurchases  were made and
that, at the end of the period  covered by this report,  no specified  number of
shares may be purchased under any program in place.

                                                                                             Maximum
                                                                          Total Number of    Number of
                                                                          Shares             Shares that May
                                                                          Purchased as       Yet be
                                    Total Number of    Average Price      Part of Publicly   Purchased
                                    Shares             Paid per           Announced          Under the
     Period                         Purchased          Share              Program            Program(a)
     ------                         ----------------   ----------------   ----------------   ----------------
<S>                                 <C>                <C>                <C>                <C>

Balance as of March 31, 2006......              --                 --                 --                 --

April 1-30, 2006..................              --     $           --                 --                 --

May 1-31, 2006....................              --                 --                 --                 --

June 1-30, 2006 ..................              --                 --                 --                 --
                                    ----------------   ----------------   ----------------   ----------------

Total ............................              --     $           --                 --                 --
                                    ================   ================   ================   ================
</TABLE>

     (a)  As a courtesy to  stockholders  of less than 100 shares and to relieve
          such stockholders of having to pay a broker's commission, the Company,
          although not  obligated  to do so, has  periodically  repurchased  its
          common stock at the then most recent  closing  price of the  Company's
          common stock on the last  trading day before the stock  certificate(s)
          is actually  received by the Company from the stockholder.  The number
          of such shares  purchased in any period of time has been  minimal;  no
          purchases were made during the quarter ended June 30, 2006.

ITEM 6.   EXHIBITS
------------------

The  following  exhibits  are filed  herewith or  incorporated  by  reference as
indicated below.

  Exhibit                                   Exhibit
Designation                               Description

 3.1                Articles of Incorporation  of Medical Resource  Companies of
                    America   (incorporated  by  reference  to  Exhibit  3.1  to
                    Registrant's  Form S-4 Registration  Statement No. 333-55968
                    dated December 21, 1992)

 3.2                Amendment  to  the  Articles  of  Incorporation  of  Medical
                    Resource Companies of America  (incorporated by reference to
                    Exhibit 3.5 to Registrant's Form 8-K dated April 1, 1993)

 3.3                Restated Articles of Incorporation of Greenbriar Corporation
                    (incorporated  by reference to Exhibit 3.1.1 to Registrant's
                    Form 10-K dated December 31, 1995)

 3.4                Amendment  to  the  Articles  of  Incorporation  of  Medical
                    Resource Companies of America  (incorporated by reference to
                    Exhibit to Registrant's PRES 14-C dated February 27, 1996)


                                       17
<PAGE>

  Exhibit                                   Exhibit
Designation                               Description

 3.5                Bylaws of Registrant  (incorporated  by reference to Exhibit
                    3.2 to  Registrant's  Form S-4  Registration  Statement  No.
                    333-55968  dated December 21, 1992)

 3.6                Amendment  to Section  3.1 of Bylaws of  Registrant  adopted
                    October 9, 2003  (incorporated by reference to Exhibit 3.2.1
                    to  Registrant's   Form  S-4   Registration   Statement  No.
                    333-55968 dated December 21, 1992)

 3.7                Certificate  of Decrease  in  Authorized  and Issued  Shares
                    effective  November 30, 2001  (incorporated  by reference to
                    Exhibit 2.1.7 to  Registrant's  Form 10-K dated December 31,
                    2002)

 3.8                Certificate  of  Designations,  Preferences  and  Rights  of
                    Preferred  Stock dated May 7, 1993 relating to  Registrant's
                    Series B  Preferred  Stock  (incorporated  by  reference  to
                    Exhibit  4.1.2  to   Registrant's   Form  S-3   Registration
                    Statement No. 333-64840 dated June 22, 1993)

 3.9                Certificate of Voting Powers, Designations,  Preferences and
                    Rights of Registrant's Series F Senior Convertible Preferred
                    Stock dated December 31, 1997  (incorporated by reference to
                    Exhibit  2.2.2 of  Registrant's  Form  10-KSB for the fiscal
                    year ended December 31, 1997)

 3.10               Certificate of Voting Powers, Designations,  Preferences and
                    Rights   of   Registrant's   Series  G   Senior   Non-Voting
                    Convertible   Preferred   Stock  dated   December  31,  1997
                    (incorporated  by reference to Exhibit 2.2.3 of Registrant's
                    Form 10-KSB for the fiscal year ended December 31, 1997)

 3.11               Certificate of Designations  dated October 12, 2004 as filed
                    with the  Secretary  of State of Nevada on October  13, 2004
                    (incorporated  by reference  to Exhibit 3.4 of  Registrant's
                    Current Report on Form 8-K for event  occurring  October 12,
                    2004)

 3.12               Certificate  of  Amendment  to  Articles  of   Incorporation
                    effective  February 8, 2005  (incorporated  by  reference to
                    Exhibit 3.5 of  Registrant's  Current Report on Form 8-K for
                    event occurring February 8, 2005)

31.1*               Rule 13a-14(a) Certification by Chief Financial Officer

*Filed herewith.









                                       18
<PAGE>

                                   SIGNATURES
                                   ----------


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


                                          CabelTel International Corporation


Date:  August 14, 2006                    By: /s/ Gene S. Bertcher
                                             -----------------------------------
                                             President & Chief Financial Officer




















                                       19
</TEXT>
</DOCUMENT>
