South Australia has a new underground copper and gold mine, as Oz Minerals launched on Friday its latest project development at Prominent Hill.

The company, which spent $148 million to develop the site, said the mine's annual production was expected to hit 1.2 million tonnes by end 2012. The Ankata mine has taken two years to construct.

About 100 jobs have since been created by the mine project, where 80 per cent of the workforce resides in South Australia.

"It has funded many community programs aimed at breaking the cycle of social disadvantage and also mentored Aboriginal business owners," Premier Jay Weatherill said during the inaugural.

"Oz Minerals also runs many programs aimed at educating their employees," he said.

Prominent Hill is located 650 kilometres north west of Adelaide, 130 kilometres north west of BHP Billiton's Olympic Dam and 130 kilometres south east of the town of Coober Pedy in the Gawler Craton of South Australia.

Underground production started in March. Full production is expected to start in September.