BANGKOK (Reuters) - Thailand’s military junta on Tuesday rejected a conditional offer from the main Muslim separatist group fighting in southern Thailand to enter into formal peace talks.

The Barisan Revolusi Nasional (BRN) said on Monday that it would be willing to enter into formal negotiations on the decades-old insurgency if certain conditions were met by the Thai government.

Among its demands were mediation by a neutral third party and the participation of international observers.

Prime Minister Prayuth Chan-ocha rejected the offer and said peace talks were an internal matter and required no international mediation or observation.

“Why do they need to come mediate? Can we not fix these problems ourselves? And if they do come what guarantees do we have that they would understand the issues?” Prayuth said.

The insurgency in the largely ethnic-Malay, Muslim-majority southern provinces of Yala, Pattani and Narathiwat has claimed more than 6,500 lives since it escalated in 2004, says independent monitoring group Deep South Watch.

Prayuth said negotiations would continue in Malaysia with a different group, Mara Pattani, but regional experts said that faction of largely exiled insurgents had no real power on the ground.

“In the long term if the government wants lasting peace in the region they must include BRN in any negotiations,” said Srisompop Jitpiromsri, director of Deep South Watch.

There has been an upsurge of violence this month, including what police described as the biggest attack in years and 23 coordinated attacks on Friday, a day after Thailand adopted a new constitution.

No group has claimed responsibility for those attacks and there were no reports of fatalities.

Yala, Pattani and Narathiwat were part of an independent Malay Muslim sultanate before being annexed by Thailand in 1909.

Voters in the most heavily Muslim parts of Thailand were among the few to reject a military-drafted constitution at a referendum last year.