Construction on Adelaide's Northern Connector road project will start in 2016, after state and federal authorities struck a deal this week.

The Federal Government says the big road project is of vital importance to South Australia's freight industry.

Despite this importance, it took months of negotiations before the federal and South Australian governments agreed for the state to fund 20 per cent of the cost.

It means the Federal Government will put up the remaining 80 per cent - about $788 million - for the multi-lane motorway linking the current Northern and Port River expressways with busy South Road.

It is expected to allow an unimpeded drive from Port Wakefield to Port Adelaide, and down South Road until Noarlunga.

The Federal Government says the expressway will benefit 50,000 motorists each day.

SA Transport Minister Stephen Mullighan said when it is complete, it will allow traffic to bypass what are currently six very busy intersections on Port Wakefield Road.

Mr Mullighan says project will support 500 jobs during construction, and promised that priority would be given to SA workers.

The SA Road Transport Association has welcomed the move ahead, saying the new road will help transport companies reduce costs.

In another major road project moving ahead in Adelaide this week, there has been progress on the widening of South Road between the River Torrens and Torrens Road in the inner suburbs, which will remove the current traffic lights at intersections including Port Road and Grange Road.