The KCRC has asked the Government for extra property development rights at the Lok Ma Chau spur line station in Kwu Tung to help cover Long Valley tunnel costs.
Sources close to the Government confirmed an informal request was made to the administration last month.
The approach came after an appeal board ruled out a previous viaduct option, forcing the corporation to embark on the more expensive tunnel option.
One source said the talks included more flexibility in the size of the site or floor space at Kwu Tung station. This issue was raised for later consideration.
KCRC director of East Rail extensions, Lee Kang-kuen, yesterday confirmed the talks, but would not give details.
Another well-placed source said no position had been taken by the Government on the KCRC request.