"It is sufficiently clear at this point in time the government of Nigeria has no intentions of considering the demands made by this group for the control of the resources and land," Mend said in a statement.
"All companies related to the oil industry in the Niger delta should prepare for an all-out onslaught against their installations and personnel."
The truce was declared in October last year, but it was breached in December when the fighters attacked a major pipeline operated by Shell and Chevron.
Attacks by Mend on Nigeria's oil and gas industry in the past few years have prevented the country from producing above two-thirds of its capacity, costing it about $1bn a month in lost revenues.
The instability has at times helped increase world oil prices.
Violence has subsided in the Niger delta since Yar'Adua's offered the fighters an unconditional amnesty if they laid down their arms.
Thousands of them did surrender in exchange for a pardon, a monthly stipend, education and job opportunities.
Al Jazeera's Andrew Simmons, reporting from the Nigerian federal capital, Abuja, said negotiations with Mend were ongoing as the group sent out its statement calling off the ceasefire.
"Remember that Mend is a big umbrella organisation. Sometimes statements don't necessary relate to actions on the ground. This is sometimes used as a pre-emptive strike," he said.
Simmons said a meeting was due next week, with the main issues being the distribution of the oil revenues and the reintegration of fighters.
"Al Jazeera understands that the stumbling block is the issue of reintegrating these fighters into normal life ... how they are going to be retrained with skills for holding on to jobs, and how they are not going to go back into criminality," he said.
Mend has been weakened by the departure of senior field commanders who accepted the amnesty, but oil infrastructure in the Niger delta remains vulnerable to attacks.
The slow progress in implementing the post-amnesty programme has been made worse by the absence of Yar'Adua, who left Nigeria to receive medical treatment in a hospital in Saudi Arabia more than two months ago.
The fighters say they seek a greater share of oil revenue for locals and have since 2006 staged bold attacks on oil facilities in the Niger delta and beyond.