Bordeaux Metropole Council has awarded a 30-year geothermal heating network contract to ENGIE.
The €43 million (£37m) project will meet 82% of the region’s heating needs, with the rest being supplied by natural gas.
It will serve around 28,000 homes, help reduce 19,000 tonnes of carbon emissions every year and create 38 direct and indirect jobs.
Work on the heating network will begin once all administrative permissions have been obtained.
Drilling of two geothermal boreholes, comprising a production and reinjection well, is expected to start in early 2019 and last for four months.
ENGIE says the heat production plant (pictured) will be built using sustainable materials.
Last year, the company announced it will buy green power from a £25 million combined heat and power plant in North Wales.