Activists have kidnapped two Chinese workers at a China-backed copper mine in Myanmar and are threatening to harm them, their firm said Monday, in the latest eruption of tensions over the controversial project.

China's Wanbao, which operates the Letpadaung mine in the northwestern town of Monywa, said the activists holding the two 23-year-old contractors were demanding the "total halting" of work.

The mine has triggered fierce opposition from local villagers due to alleged land grabs and environmental damage, and has raised questions about Myanmar's reliance on investment from neighbouring China -- which gave crucial political support to the former junta.

"We are deeply distressed and concerned by this threat," the firm said in an updated statement on Monday, adding it had received new threats that the men would be harmed if activists' demands were not met.

"Wanbao vehemently condemns this unprovoked attack," it said.

The company, which runs the project as part of a joint venture with a Myanmar military-backed firm, said earlier the men were surveying a part of the mine Sunday when they were set upon by activists and two local monks, who later issued a death threat.

A 21-year-old Myanmar national was also abducted Sunday but released the same day.

"We strongly urge that our two colleagues be released soon," said Wanbao official Cao Densheng, adding that the company had asked for help from local authorities in Sagaing division.

The copper mine has been the subject of several protests by campaigners and local villagers, mainly over land rights and compensation.

A local monk, who asked not to be identified, told AFP the Chinese were held after they entered a village near the mine.

"They are threatening that they would kill the two Chinese men if the village is raided. The situation is very tense at the moment," he said.

Local people said the incident followed a clash between residents and police on Saturday night.

"Villagers are now trying to negotiate with the authorities," said Thwe Thwe Win, an activist from a nearby village.

A botched raid on a protest at the mine in November 2012 sparked anger after police used phosphorus against demonstrators. Dozens of people including monks were injured in the harshest crackdown since the end of military rule in early 2011.

- Call to halt mine -

Wanbao said the demands escalated during Sunday, with the kidnappers finally calling for the entire mine project to be halted and threatening to kill the captives if people from the village were injured by police attempting to free the men.

"Wanbao cares greatly for the people of Myanmar and we very much hope that this issue can be resolved peacefully as soon as possible so that our colleagues can return to their families," the firm said, adding that opposition to the mine came from "a small number of extremists and activists".

An official from the Forestry and Mining Ministry in Sagaing said top officials were on their way to the area without giving further details.

The incident comes as China sent five ships to help evacuate its nationals from Vietnam after territorial tensions between the neighbours spilled into deadly rioting last week.

During Myanmar's junta era the ruling generals, tarnished by mounting human rights abuses, were shielded from some international opprobrium by China's economic might and its UN Security Council veto.

China in turn had access to Myanmar's abundant natural resources such as metals, timber and gemstones, as well as involvement in numerous hydropower projects.

But observers believe the scale of China's influence helped spur the Myanmar junta in 2011 to hand power to a quasi-civilian government. It launched dramatic political reforms that helped to sweep away most Western sanctions.

President Thein Sein in 2011 ordered the suspension of work on a hugely unpopular Chinese-backed mega-dam.

In July 2013 the country revised the terms of the mine deal with Wanbao, in an apparent attempt to allay public anger over the scheme by giving the nation a share of the profits.

Opposition leader Aung San Suu Kyi, who is normally venerated around the country, was heckled by villagers last year after she recommended that the mine be allowed to go ahead.