A witness accused of lying about a New South Wales coal licence had told a corruption inquiry he was only improvising his answer.

The Independent Commission Against Corruption (ICAC) has heard former state Labor minister Ian Macdonald granted the Doyles Creek coal licence to former union boss John Maitland without a tender in 2008.

Coal executive Mike Chester last week told the inquiry he was asked to advise the NSW government on Mr Maitland's proposal before it was approved.

Today Mr Chester denied lying about of amounts of money involved, but when pressed further said he could not recall some information.

"I was improvising," he told counsel-assisting Peter Braham.

The witness denied writing two bogus letters to support Doyles Creek as a training mine.

In one letter he was accused of falsely stating $5 million equity had been raised.

Mr Chester said that was not a lie because he knew the investors would eventually come up with the money.

The ICAC has heard Mr Chester is a director of NuCoal, the company that acquired the licence in 2010.

The inquiry before Commissioner David Ipp continues.