The Silverstream water network pipeline runs underground alongside Flagstaff and Whare Flat Rd and the creek.
Dunedin City Council water production manager Gerard McCombie said in times of flood, scouring occurred, endangering the pipeline which fed the southern reservoir and through it, the southern water treatment plant.
"The pipeline is pretty important to us from a water supply point of view."
The planned work would realign 150m of the creek, just upstream of its confluence with the Silverstream, away from the pipeline so it was no longer in danger.
It would also create a more stable creek bed.
The work had resource consent from the Otago Regional Council and was scheduled to take place over six weeks in summer to avoid the winter fish spawning season.
Tenders for the work closed yesterday and were being evaluated, Mr McCombie said.
