Origin Energy Ltd has knocked back a $A13.6 billion ($NZ16.9 billion) takeover offer from BG Group of the UK because it does not reflect the value of is assets and future potential.
BG had this week made an improved cash offer of $A15.50 a share, up from an initial $A14.70, or $A12.9 billion.
But Origin, which owns 51.4 percent of New Zealand's Contact Energy, said that after taking expert advice on its coal seam gas assets, which resulted in an increase of its reserves, it had decided not to accept the proposal.
Origin said the expert coal seam gas report by Netherland, Sewell & Associates Inc resulted in an increase in its possible, probable and proved (3P) reserves by 121 percent to 10,133 petajoules (PJ) as at May 15.
Its possible and probable (2P) resources were increased by 91 percent to 4715 PJ.
The report also identified a contingent resource of 13,497 PJ and prospective resources of 17,947 PJ.
"This certified assessment confirms Origin's pre-eminent position as the largest holder of coal seam gas reserves and contingent resources in Australia, and demonstrates Origin's unparalleled record of converting resources into reserves," Origin said.
