The firm will build extra storm water storage facilities at Wheatcroft Sewage Pumping Station as well as a new 25m diameter, 35m deep storage shaft at Toll House Pumping Station.
The project team will also construct diversion and reconnection tunnels between the existing sewer, Toll House pumping station and a new combined sewer overflow.
Also an existing pumping station at Scalby Mills pre-treatment facility will be extended and major pumps added to discharge into 0.8m diameter rising main which will be laid 2km over farmland to the Scarborough waste water treatment works.
Here it will be treated in three new settlement tanks and an ultra violet treatment facility before passing through a further 2km of new pipeline to the existing sea outfall.
The completed project will improve the quality of the water which is discharged into the sea during storms.
Jag Paddam, managing director of Infrastructure at Morgan Sindall, says: “We are delighted to have been awarded this project which will use the expertise of both our infrastructure and tunnelling teams.
“This expertise has enabled us to optimise the scheme design and construction method to minimise disruption to the general public.
Design work is already underway, with construction due to start this month for completion in February 2014.
The Scarborough project has been awarded as part of the AMP5 Yorkshire Water Framework, to which Morgan Sindall was appointed in August 2010.
Projects under this framework range in value from £5m-£50m.