* Looking to raise funds for Australian iron ore ambitions
* Indian consortium not sole bidder-report
* Aquila may have to sell new shares to meet funding needs
MELBOURNE, March 1 (Reuters) - Aquila Resources confirmed on Thursday it is in advanced talks to sell its Washpool coking coal asset to Indian state consortium International Coal Ventures (ICVL), a closely watched sale the miner needs to help fund its iron ore ambitions.
Aquila will need to raise more than A$3 billion ($3.24 billion) to fund its 50 percent share of a new iron ore mine and port project in Western Australia, which has been delayed due to port and funding issues.
Dow Jones reported on Wednesday that ICVL, which combines utility NTPC, Steel Authority of India, iron ore miner NMDC, Coal India and steelmaker Rashtriya Ispat Nigam Ltd, had sought to extend talks to buy Aquila's Washpool hard coking coal project for A$301 million.
The report, citing two unnamed senior Indian government officials, said ICVL needed two to three weeks extra to secure approvals from the Indian government.
"The company confirms that it is in advanced discussions with ICVL, however, at this time, no binding offer capable of acceptance has been received from ICVL," Aquila said in a statement to the Australian stock exchange on Thursday.
ICVL is not the only bidder, according to a person familiar with the transaction, who did not want to be named because the talks are confidential.
Aquila, being advised by UBS, has been looking to sell the Washpool hard coking coal project in Queensland and its Avontuur manganese project in South Africa to help raise funds for its West Pilbara iron ore project.
Analysts estimate it could get around A$700 million from asset sales, including Washpool and Avontuur.
The company has said it would like to fund two-thirds of its A$3 billion share of the West Pilbara iron ore project through debt, with most of the rest covered through asset sales.
However with credit markets tightening and project costs increasing, analysts say the company may have to sell new shares to help fund the project, a factor that has been weighing on Aquila's share price.
The stock has fallen 12 percent so far this year against a 10 percent rise in the mining sector.
$1 = 0.9255 Australian dollars Reporting by Sonali Paul; Editing by Matt Driskill