OZ Minerals has announced that it intends to expand its South Australia underground mining operations at Prominent Hill due to favourable changes made to the mining taxes.

OZ Minerals the expansion project will generate more than 200 jobs in Prominent Hill, which is an open field gold and copper mine.

Plans for underground expansion were postponed a couple of months ago, but Terry Burgess, managing director of OZ Minerals, says the project is likely to push through now that mining taxes have tipped to their favour.

"We were very pleased when the announcement was made that the tax didn't apply to copper operations," he remarked.

Approximately 12,000 ounces of gold and 25,000 tonnes of copper are projected to be mined annually from the underground expansion.

Construction operations for the expansion will begin right away and production is set to start by the later part of the following year.

Rowan Ramsey, Federal MP of Grey, urges OZ Minerals to widen their perspective in filling those 200+ new job posts.

"These are good, high-paying jobs and they bring back great benefits to the local communities and in the end the expansion of Adelaide is not the do all and end all of South Australia," Mr. Rowan said.

"We want to see a lot of these people based in our regional communities where they contribute to the economic environment there."