altera cyclone

It looks like your Cyclone kit has everything you need. You can use some digital I/Os for the I2C bus. As the I2C data pin (SDA) needs to be bidirectional, you will need to use a full 8-bit port just for the SDA signal, but it isn't a problem since you have lots of I/O pins available on the kit.

As you will also need some I/O pins to connect a character LCD you can for example use the buffers like this:

[list][*]U26 1: SDA pin (direction on pin 1, SDA I/O on one of the pins 37,38,40,41,43,44,46,47

[*]U26 2: SCL (can be always configured as an output, of your device doesn't do clock stretching)

[*]U27 1: data for the LCD (8 bits), bidirectional

[*]U27 2: control for the LCD (3 or 4 bits IIRC, outputs only)[/list]