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BP PLC has confirmed this week that mechanical work on a new coker unit at its 110,000 barrels-per-day (bpd) refinery in Castellón, Spain looks set to be completed by the end of this year, Dow Jones reports.

The $300 million project to build and install a new coker at its Castellón facility is the largest single investment in the asset since it was built 40 years ago.

The installation of the coker unit is expected to lead to an increase in diesel production at the refinery in order to meet local demand. At the same time, however, BP also looks set to cut fuel oil production at the plant.

In a BP Magazine article published last year entitled "Spain: An economy in Bloom", the company said "Running alongside the thirst for diesel is a slow-down in the demand for fuel oil – a bottom-of-the-barrel product used primarily for power generation. The result is a harmonious shift in production."

Commenting on the project in the same article, Jorge Lanza, refinery manager, said "The coker project increases the diesel production on the back of fuel oil. So, we are upgrading the bottom of the barrel and are going to eliminate fuel oil production at the same time as increasing diesel production to meet the new market demand."

"At the moment, we’re producing 17 percent fuel oil and we’re going to increase diesel from 35 percent to roughly 50 percent."

The Castellón plant refines a number of products including marine and aviation fuels, heating gasoil, bitumen, lubricants, gasoil, automotive gasoline and liquefied petroleum gas (LPG).

The company's bunkering operations are mainly focused on suppying tankers working tankers at its Castellón refinery.