BEIJING Dec 24 A subsidiary of China Minmetals Corp, one of the country's top miners, launched the first phase of a new energy battery raw materials project in top steelmaking city Tangshan, in an effort to extend the supply chain of its nickel mine in Papua New Guinea.

The project is part of China's push to safeguard new materials resources amid booming demand for batteries.

China Metallurgical Group Corp (MCC), which merged with Minmetals in 2015, said the project will churn out 40,000 tonnes of nickel-cobalt-manganese (NCM) hydroxides, a key raw ingredient for lithium-ion batteries, and 20 tonnes of high-purity scandium oxide per annum in phase I, according to a company statement on Monday.

The two products are widely used in new energy vehicles, energy storage and power generation sectors.

"(The project) broke through full supply chain from mining to whole car manufacturing... and seize the opportunity of new energy development to upgrade raw materials from Papua New Guinea," Zong Shaoxing, chairman at MCC's new material branch, said in the statement.

Minmetals has access to 140 million tonnes of nickel-cobalt resources in Papua New Guinea and the equivalent of 1.6 million tonnes of lithium carbonate at the Yiliping salt lake in northwestern China.

The project, located in the port region of Tangshan city in northern China, will cost more than 4 billion yuan ($579.84 million) for two phases of developments to produce a total of 60,000 tonnes of NCM hydroxides and 40 tonnes of scandium oxide every year.

China's leading electric vehicle maker, BYD Co Ltd , and battery producer Guoxuan High-tech Co also participated in the project, according to the statement.

The company did not disclose a detailed plan for the second stage of the project, but said it will "carry out investment and construction based on market trend and production situation of the first phase".

($1 = 6.8985 Chinese yuan) (Reporting by Muyu Xu and Ryan Woo; Editing by Subhranshu Sahu)