The increase in consolidated gross margin was driven by volume expansions and higher natural gas price in our Field Gathering and Processing segment and higher fractionation fees and increased exports activities in our Logistics and Marketing division. Offsetting these favorable factors were the effects of lower NGL prices and lower system volumes in our Coastal Gathering and Processing segment. Logistics margins were partially constrained by the planned maintenance and inspection turnaround at Cedar Bayou Fractionators (CBF). Higher operating expenses were driven by system expansions in Field Gathering and Processing, growth projects in Logistics, the Badlands acquisition and higher labor and maintenance costs. See "Targa Resources Partners – Review of Segment Performance" for additional information regarding changes in the components of operating margin on a disaggregated basis.

The increase in depreciation and amortization expenses was primarily due to the Badlands acquisition, system expansions and other assets placed in service during the last twelve months.

General and administrative expenses increased primarily due to higher compensation and benefits.

The increase in interest expense reflects higher borrowing levels to fund our business expansion ($8.0 million), offset by higher interest capitalized on major capital projects ($5.9 million).

The June 2013 redemption of $100 million of the outstanding 6⅜% Notes at a redemption price of 106.375% plus accrued interest resulted in a $7.4 million loss, consisting of a premium paid of $6.4 million and the write-off of $1.0 million of unamortized debt issue costs.

The decrease in net income attributable to noncontrolling interests reflects the impact of lower earnings at the non-wholly owned upstream consolidated subsidiaries, primarily at our Versado and VESCO joint ventures, which were affected by operational issues.

Six Months Ended June 30, 2013 Compared to Six Months Ended June 30, 2012

The decrease in revenues reflects lower realized prices, especially during the first quarter of 2013, on NGLs ($418.2 million), which were partially offset by the impact of higher realized prices on natural gas and condensate ($197.5 million), the impact of higher commodity volumes ($51.6 million) and higher fee-based and other revenues ($44.7 million).

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