UPDATE 1-New Hope says will not up offer for Resource Pacific

(Adds New Hope comment, details, adds share price)

SYDNEY, Dec 10 (Reuters) - New Hope Mining (NHC.AX: Quote, Profile, Research, Stock Buzz) said on Monday it will not raise its bid for fellow Australia coal miner Resource Pacific Ltd RSP.AX, after being trumped last week by Swiss mining group Xstrata (XTA.L: Quote, Profile, Research, Stock Buzz).

Xstrata on Dec. 5 made a A$960 million ($842 million) cash bid for Resource Pacific, citing the proximity of some of its mines to those owned by Resource Pacific as a reason to merge.

Xstrata is offering A$2.85 a share, compared with New Hope's (NHC.AX: Quote, Profile, Research, Stock Buzz) offer of 0.94 of its own shares for every Resource Pacific share, the equivalent of about A$759 million based on its current share price of A$2.40.

New Hope said in a statement it acknowledged "the superior synergies that Xstrata could extract from Resource Pacific," and it was applying to have its offer withdrawn.

Resource Pacific was 0.66 lower at A$3.03 in step with modest declines in the S&P/ASX200 index.

Resource Pacific operates the Newpac coking and thermal coal mine, which neighbours Xstrata mines in the Hunter Valley region of New South Wales state.

Rocketing coal prices have triggered a stampede among producers to gain berths at Australia's overtaxed export terminals. Resource Pacific holds a coveted 4 million tonnes annual shipping quota allocation.

Prior to its bid, Xstrata agreed with Marubeni Corp (8002.T: Quote, Profile, Research, Stock Buzz), Resource Pacific's biggest shareholder, to buy the Japanese group's stake. ($1=A$1.14) (Reporting by James Regan)