* Washpool coking coal project could fetch $324 million
* Looking to raise funds for Australian iron ore ambitions
* Indian consortium not sole bidder-source
* Aquila may have to sell new shares to meet funding needs (Adds analyst estimate, China Development Bank, Baosteel role)
MELBOURNE, March 1 (Reuters) - Aquila Resources said on Thursday it is in advanced talks to sell its Washpool coking coal project to Indian state consortium International Coal Ventures (ICVL), a sale the miner needs to help fund its iron ore ambitions.
Analysts have estimated the Washpool hard coking coal project in Queensland could fetch around A$300 million ($324.14 million).
The sale is being closely watched by investors as Aquila needs to sell assets to help 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. The iron ore project has been delayed due to port and funding issues.
Dow Jones reported on Wednesday that ICVL had sought to extend talks to buy Aquila’s Washpool 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.
ICVL is made up of utility NTPC, Steel Authority of India, iron ore miner NMDC, Coal India and steelmaker Rashtriya Ispat Nigam Ltd.
“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, a person familiar with the transaction told Reuters, declining to be named because the talks are confidential.
Aquila, being advised by UBS, has been looking to sell the Washpool asset 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 raise 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.
Aquila, 14 percent owned by Baoshan Iron & Steel Co , is in talks with China Development Bank on debt funding for the project, which it had hoped to secure by the end of last year.
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