The $US800 million ($A1.05 billion) floating plant, unveiled in August 2003, was expected to start operating next year, with first production due in 2009. It would provide a market for Scarborough, an ExxonMobil/BHP offshore Western Australian gas field.

But the proposed project has received widespread criticism from residents in California, including many celebrities.

On Sunday, actors Pierce Brosnan and Martin Sheen led 200 placard-carrying Californian locals in a protest against the development.

The demonstration came two days after the release of a 3000-page final environmental impact report, which said the terminal would significantly affect air quality, ocean views and marine life. It also concluded that an accident could affect ships heading to or departing from the country’s busiest port complex at Los Angeles and Long Beach harbours.

The document, prepared by the US Coast Guard, California State Lands Commission and US Marine Administration, will play a key role in several hearings over the next 70 days to determine whether the facility will go ahead.

In a bid to appease critics, BHP has made several changes to the project, including modifying Cabrillo’s engine cooling system to use freshwater instead of seawater to minimise the impact on marine life. The company also re-routed part of the onshore pipeline route away from populated areas and redesigned the offshore pipeline in a bid to improve safety.

The 14-story, 295m LNG terminal located 22km off the coast is proposed to process about 800 million cubic feet of natural gas daily, to supply about 12% of California’s daily gas needs.

To reduce air pollution, the company has agreed to use advanced technology at the floating processing plant, power the tankers and tugboats with clean-burning fuels and offset the remaining emissions by cleaning up two other tugboats that push barges up and down the California coast.

But the environmental document says the company has failed to show it can reduce emissions to an insignificant level.