A California congressman is accusing the Environmental Protection Agency of bowing to political pressure when it reversed a key decision regarding an Australian energy company’s proposal to build a floating liquefied natural gas terminal off the coast of Ventura County.

In a letter to EPA Administrator Stephen Johnson, dated March 5, Rep. Henry Waxman (D-Los Angeles) alleges that a senior EPA official convinced agency staff to change its opinion on BHP Billiton’s Cabrillo Port project, exempting the firm from compliance with the Clean Air Act, after meeting with representatives of the company in 2005.

Waxman also claims that the EPA’s refusal thus far to turn over documents justifying its actions “is impeding Congress’ investigation into these issues.”

“It’s reprehensible,” said Susan Jordan, director of the Santa Barbara-based California Coastal Protection Network (CCPN), of Billiton’s alleged lobbying. Attorneys for CCPN and the Environmental Defense Center reviewed the documents that supposedly reveal the correspondence between the company and the EPA, which were then sent to Waxman, the chairman of the Committee on Oversight and Government Reform.

Originally, the EPA had stated that Billiton would be forced to reduce and offset the pollution caused by Cabrillo Port as outlined in the Clean Air Act. Knowing they could not meet those requirements, Jordan alleged, the company spent a year using “political lobbying and interference and pressure to force the EPA to reverse their position.”

According to Waxman, documents show that Jeff Holmstead, EPA assistant administrator for air and radiation and a Bush administration appointee, met with Billiton officials on March 16, 2005. One month later, Holmstead held a conference call with regional EPA staff which had, up to that point, repeatedly reaffirmed its stance requiring Billiton to mitigate the project’s emissions.

Then, in June 2005, in a brief two-page letter to the U.S. Coast Guard, the EPA announced that upon “further analysis … we have concluded offsets are not required for sources constructed in the area,” permitting the company to comply only with less stringent offshore regulations. Waxman has asked for and not yet received evidence of the analysis on which the EPA based its decision.

Representatives for the EPA could not be reached for comment.

The allegations come just as the final Cabrillo Port Environmental Impact Report is released. On April 4 and 9, the Coast Guard will hold public hearings on the report. From there, the California State Lands Commission and the California Coastal Commission have 45 days to either approve or reject the project.

Gov. Arnold Schwarzenegger has final veto power over the proposal.

“It’s going to be a true test of his environmental credentials,” Jordan said.