No, from what i understand, the engines are sealed. Use it and it cant be altered (without penalty). Given you can use 5 engines per season, it's up to the team to allocate them wisely so that they can also use the available tokens to upgrade it. E.g. you wouldnt use 5 engines for the first 5 races because you will no longer be able to carry out updates. You use one for as long as you can, then plan your token usage on the unused unsealed engines.
This is pretty much in line with what AMuS reports. According to the article there from this weekend, Mercedes have now got 6 tokens left. It is uncertain of those 6 will be used and when. When they will, Nico will profit, but Hamilton (and the team) think having fresher and more engines will offset that. They dont believe those 6 tokens will yield a huge advantage (at this point).