Can I bulk at this body fat percentage?

You'll get mixed opinions. Let's assume you're truly at 16%. I assume you mean DEXA scan. They're good, but not perfect. IMO you could maingain from here. So you'd stay at around 16% bf, while still having plenty of energy to build muscle, without the inconvenience of bulk/cut cycles. Others will say do the lean bulk (small surplus, clean food) then cut. There isn't a wrong answer here I think, and it comes down to how you want to proceed.

I would say in general a lot of guys feel over-optimistic about their body fat levels, and then bulk with too large a surplus, because eating lots is fun and you feel strong in the gym too. Maybe track your waist measurements and go by that. If it's going up too much for your liking, back off.

3500 cals is a pound. You can estimate how long from that, assuming 100% of any weight loss is fat, which it may not be.

matbas98, you’ve asked about: 1) lean mass bulking at 16% bf, 2) duration of time it takes to lose 1% bf at a 500k deficit/week and 3) bulking up to 18% bf and then cutting.
Answers: 1) There are varying accuracy levels in body scan modalities. Regardless of the type you used, you’ll want to rule out as many variables as possible to track your progress. I reccomend measuring your waistline, Tricep, each thigh, calve and chest with a tape measure each week, a progress picture and do these things along with the scan and weighing in at the same time each morning after going to the bathroom/before eating. What is more important than the percentage is being happy with how you look. The same body fat % can look different on each person.
2) You can begin and end a bulk when you’d like because it’s your experiment. Just track the progress and write down the details of what you did to compare it to future trials. It will show you comparisons.
3) A pound is 3500 calories and 1% of body fat would be .01 multiplied times your total pounds in body fat (different than total body weight). You must consider how many calories you lose or hold onto from the difference in physical activity output and food consumption ratios.

The last answer is pure math. Here's how it breaks down:

Let's say Bob weighs 200# at 18% BF. Bob has 36# fat (200*18%) and 164# of not-fat (muscle, skeleton, water, etc) (200-36).

If Bob sets a goal of losing fat to 17% while keeping the rest of the body the same, that means the same 164# not-fat will now be 83% of the total. Divide 164/83%, you have a target body weight of 197.5. This means Bob will reach 17% if he loses 200-197.5 = 2.5# of fat.

Each pound of fat loss requires 3500 calories deficit. So the total deficit will be 3500*2.5 = 8750. If Bob now sets a weekly goal of 500 cal below maintenance each week, he'll lose the 2.5 pounds in 8750/500 = 17.5 weeks. If he increases the deficit to 250 cal per day, he can reduce the time required to 5 weeks.