UPDATE 1-Tupras to invest $1.6 bln in refinery project

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ISTANBUL, March 11 (Reuters) - Turkish oil refiner Tupras TUPRS.IS said on Tuesday it planned to invest $1.6 billion in a refinery project that would turn high-sulphur fuel oil into diesel and gasoline products between this year and 2013.

The project, which will be financed largely by external borrowing, will add more than $500 million in annual earnings before interest, taxes, depreciation and ammortisation, the company said in a statement sent to Reuters.

The project will add $6.3 of profit per barrel at the company's Izmit refinery.

The project will increase diesel production by 25 percent by 2013, increase liquid petroleum gas production by 19 percent, gasoline production by 14 percent within the same time span, the company said.

The planned investments will turn an annual 3.2 million tonnes of fuel oil into 1.9 million tonnes of diesel and jet fuel, 530,000 tonnes of gasoline, and 160,000 tonnes of LPG.

Tupras, which is the only refinery in European-Union candidate Turkey, has reduced the level of sulphur in its refined products to meet EU fuel standards. (Reporting by Ercan Ersoy; editing by James Jukwey)