Melbourne Rebels dump Wallaby O'Connor

The Melbourne Rebels have compounded Wallaby flyhalf James O'Connor's woes at losing the deciding Test to the British and Irish Lions by confirming on Sunday they will not be offering him a further contract beyond the 2013 season.

O'Connor, who has received mixed reviews as fly-half over Quade Cooper in Australia's failed series against the Lions, is now expected to move to another Australian Super Rugby club next season.

Melbourne Rebels chief executive Rob Clarke "complimented" O'Connor for his contribution to the club over the last two years, which he said was "unfortunately limited due to a string of injuries."

"I would like to acknowledge the role James has played in helping the Rebels gain traction in the very competitive sporting landscape in Melbourne," Clarke said in a statement, a day after the Wallabies were thrashed 41-16 by the Lions in the deciding Sydney Test.

"After three years in the Super 15 competition, the club is entering the next phase of development.

"I am very confident in our player recruitment strategies which continue to identify some excellent emerging talent. This group will provide the platform for continual improvement, both on and off the field."

Besieged Wallabies' coach Robbie Deans' decision to go with O'Connor as rookie flyhalf over incumbent Cooper hinged on how an overhauled Australian backline performed with O'Connor calling the shots at number 10, but the move backfired in the 2-1 series loss to the Lions.

O'Connor was one of Australia's better players in the third Test loss, scoring their only try after a superb jinking run.

However, it was apparent from the outset the brash 22-year-old's elusive ball-running game was better suited on the right wing or inside centre as he struggled to take the right options as the team's chief playmaker.

The Melbourne Rebels' decision to jettison O'Connor followed reports of continued ill-discipline off the field, staying out until 4am midweek before the second Melbourne Test with Rebels teammate Kurtley Beale, and showing a lack of remorse afterwards.