BHP Billiton is not abandoning plans to build a floating gas import terminal 14 miles off the affluent beaches of Malibu, despite rejection by two state authorities in California and a protest by local celebrities, including Pierce Brosnan, Halle Berry and Cindy Crawford.

The mining and energy group says that it will not scrap the Cabrillo Port project, despite a decision by the California Coastal Commission that the project failed to meet rigorous coastal protection standards, notably the risk to marine mammals, ocean views and birdlife, as well as smog and global warming. Its rejection came after a two to one decision by the State Lands Commission not to grant a lease for the project.

“No, it’s not over,” a BHP spokesman in Calfornia said. “We are assessing the comments of the commissioners. We have to see how we can address those comments.”

A huge outcry from residents of the beach communities in Malibu County has succeeded in derailing plans to build California’s first liquefied natural gas import terminal. Opponents of Cabrillo Port garnered support from Hollywood stars such as a wetsuit-clad Darryl Hannah, who joined a paddle-out protest at Malibu’s surf-rider beach.

Offshore, BHP Billiton proposed to build a floating vessel the size of three football pitches. LNG tankers from Asia would unload frozen fuel into storage tanks and a regasification plant would heat up the frozen gas and pipe it to shore and into Calfornia’s gas grid.

At a cost of $800 million, (£403 million), Cabrillo Port was intended to bring Asian gas to a state desperate for new sources of fuel at a time when America’s indigenous gas supplies are dwindling rapidly. Siting the LNG regasification plant far offshore was intended to quell local anxiety.

BHP is taking some comfort from apparent political support for the project from the the state government. Arnold Schwarzeneggar, the California Governor, reiterated his support for LNG after the negative ruling by the California State Lands Commission.

“It would be inappropriate for me to take a position on any application before the review process is complete, but I do believe that liquefied natural gas should be a part of California’s energy portfolio.” he said. “Natural gas is the cleanest-burning fossil fuel and an LNG facility to serve our state would make California less vulnerable to variations in supply and price.”

About a dozen LNG projects are mooted for America’s West Coast, but none has yet been approved, other than a project south of the Mexican border in Baja California, which proposes to pipe gas north to Californian consumers.

The rejection of Cabrillo Port will cause alarm among rival importers, such as Suez, the French utility, which is proposing to build a terminal off the Florida shoreline.

LNG has suffered huge obstacles in its development in America, despite its widespread acceptance in Europe and Asia. Despite being the largest gas market in the world, there are only four LNG receiving terminals in operation in the US, two of them operated by foreign companies, BG’s Lake Charles facility in Lousiana and the Suez LNG terminal in Boston. New projects have been dogged by fears of explosions and general resistance by Americans to any form of industrial development in their neighbourhood. LNG is less of a safety risk than gas because the fuel is not flammable when it is chilled into liquid.

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