Castellón Green Hydrogen SL said the project, being constructed at BP’s Castellón refinery, had reached 90% assembly completion, with 100% of equipment now on site.

This includes the 25MW Plug Power PEM electrolyser system.

The JV stated that it will commence testing in May to monitor the operation and performance of the plant.

The €70M ($81.2m) project, equally owned by the British oil firm and the Spanish power company, will produce up to 2,800 tonnes of green hydrogen per year to displace grey hydrogen already used in the refinery.

Having received a €15m ($17.4m) Spanish subsidy, the plant will be powered by renewables under a power purchase agreement with Iberdrola.

BP Vice-President of Hydrogen for Europe and MENA, Carolina Mesa, said the project’s advancement reflected “tangible progress” in decarbonising industry.

While the new plant is expected to cut around 23,000 tonnes of carbon dioxide from the refinery, its scale is significantly smaller than originally planned.

In 2023, BP said it would build “at least” 200MW of electrolysis capacity at the site by 2027, with intentions of scaling up to 2GW by 2030.

The JV’s announcement made no mention of a potential scale-up.

BP is currently constructing a 100MW green hydrogen plant in Lingen, Germany.

More broadly, the oil and gas major has been quickly pivoting back towards fossil fuels, which will see it limit further hydrogen and carbon capture projects.

The firm recently pulled out of a large-scale UK blue hydrogen project, as well as a major planned green hydrogen and renewable hub in Australia’s Pilbara region.

It also previously said it had stopped 18 early-stage hydrogen projects.