French Prime Minister Manuel Valls says a planned fleet of French-designed Australian submarines will all be built in Australia on time and within budget.

Valls met his Australian counterpart Malcolm Turnbull on Monday, a week after Australia announced that DCNS, a French state majority-owned company, had been chosen to design 12 diesel-electric submarines.

Australia expects the fleet will cost at least 56 billion Australian dollars ($43 billion), although the contracts have yet to be signed.

Valls dismissed speculation that at least the first 97-meter (318-foot) long Shortfin Barracuda would be built in a DCNS shipyard in France before construction shifts to the Australian manufacturing hub of Adelaide.

Turnbull agreed that the "entire submarine fleet" would be built in Adelaide by Australian workers with Australian steel.