A feasibility study will be carried out to build two European Pressurised Reactors in Saudi Arabia, French Foreign Minister Laurent Fabius announced after a meeting with Saudi Defence Minister Prince Mohamed bin Salman in Paris.
The announcement came as talks with Iran go to the wire ahead of the June 30 deadline.
World powers are looking for guarantees that Iran's nuclear programme will remain purely for civil energy purposes, and does not lead to a bomb or trigger an arms race with its regional competitors, particularly the Saudis.
In addition to the feasibility study, France will sign an agreement to train the Saudis on nuclear safety and the treatment of nuclear waste.
A French diplomatic source told AFP that if the nuclear reactors are built the deal would be worth at least $10 billion.
A slew of other deals -- totalling some $12 billion (10.7 billion euros) -- were also finalised during the first "Franco-Saudi Joint Commission" meeting, including the sale of 23 H-145 multipurpose helicopters for 500 million euros and a commitment from the Saudis to buy 30 patrol boats for its navy.
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"It represents the creation of many jobs and hundreds of millions of euros," Fabius added.
Fabius also mentioned the Saudi Arabian Airlines order for 50 Airbus passenger planes valued at $8 billion, first announced at last week's Paris Air Show.
France has been reinforcing links with the conservative kingdom despite persistent criticism of its human rights record, while Riyadh is keen to broaden its ties with Western powers beyond its traditional alliance with the United States.
Salman also met French President Francois Hollande later on Wednesday.
Saudi Arabia has been under international pressure, including from Washington and Paris, to drop a sentence of 1,000 lashes for a renowned human rights activist and blogger.
The kingdom has also faced criticism over its use of the death penalty. According to an AFP count, Saudi Arabia executed 102 locals and foreigners in the year to mid-June, compared with 87 during all of 2014.
Saudi Arabia's Supreme Court has confirmed death sentences for two suspected Saudi Al-Qaeda members convicted of murdering four Frenchmen in 2007, according to press reports.
The pair were convicted of shooting dead the French nationals -- one of whom was a teenager -- near the western city of Medina while they were on a desert excursion from their homes in the capital Riyadh.