City boundaries gas penetrates (6)
I believe the answer is:
rheims
'city' is the definition.
(French city)
'boundaries gas penetrates' is the wordplay.
'boundaries' becomes 'rims' (rim is a kind of boundary).
'gas' becomes 'he' (chemical symbol for Helium).
'penetrates' means one lot of letters goes inside another.
'rims' placed around 'he' is 'RHEIMS'.
(Other definitions for rheims that I've seen before include "Where most French coronations took place" , "French coronation city" , "City in NE 22 across" , "Somewhere in France" , "The Jackdaw of -- (Barham)" .)