YAKIMA, Wash. — In what’s being called a major step forward in a ground-breaking Yakima basin water conservation plan, a $3.8 million pipeline contract has been awarded.

The federal Bureau of Reclamation has awarded a Florida construction company a contract to convert an open canal west of Ellensburg to a pressurized pipeline, saving about 1,300 acre-feet of water annually.

The project is the first phase of the Yakima River Basin Integrated Water Resource Management Plan, an agreement between environmentalists, irrigators and tribal, state and federal agencies.

The agreement grew out of a lawsuit 12 years ago, when an environmental group, the Washington Environmental Council, sued irrigators arguing their water diversions from Manastash Creek kept fish from reaching some 25 miles of prime spawning and rearing habitat in the creek’s headwaters. The lawsuit brought stakeholders to the table, and the agreement was reached after six years of negotiations.

With a pressurized pipeline, water that would otherwise be lost to seepage will return to the Manastash Creek, which now dries out each summer due to irrigation withdrawals. Construction is expected to start in September and continue until April.

A total of $7 million — a cost shared between the state Department of Ecology and the Bureau of Reclamation — will be spent on the entire project that also includes consolidating irrigation diversions and adding fish ladders and screens in the lower six miles of the creek.

Water rights have also been purchased, leaving water in the creek to boost flows.

Additionally, a $5 million project by the reclamation bureau to remove the creek’s final irrigation dam and pipe a small open canal that follows the creek could see fish return to some 25 miles of pristine habitat in the upper creek by the end of the year, the release said.

Manastash Creek, a Yakima River tributary, drains a watershed of 97 square miles southwest of Ellensburg.