A Richmond-based railroad conglomerate, gearing up for an expected statehouse slugfest over a proposed coal slurry pipeline in southern Virginia, has retained former Republican governor John N. Dalton's law firm to lobby against the project during the upcoming General Assembly session.

Dalton, along with six other lawyers from the firm of McGuire, Woods and Battle, registered as lobbyists Friday for the CSX Corp. to oppose the pipeline. The proposed $650 million project is being pushed by a consortium of Virginia Electric & Power Co. and Transco Energy Co. of Houston.

The pipeline issue, pitting two of the state's most powerful corporate interests, is rapidly turning into the premier special interest issue facing Virginia lawmakers when they convene Jan. 12 for the annual legislative session.

Vepco contends that the 400-mile pipeline, which would pump a slush-like mixture of pea-sized coal and water from the coal mines of Southwest Virginia to the utility's power plants in Tidewater, would cut transportation costs and ultimately hold down customers' electric bills.

The railroads, which currently move the coal, fear the pipeline could cost them millions of dollars in business and have cited a host of environmental and legal issues in opposing the project.

Dalton's selection beefs up a CSX lobbying corps on the issue that includes Charles Davis, Dalton's former press secretary. In addition, it was learned that William B. Hopkins, the former majority leader of the state Senate and a Democrat, has been retained by the Virginia Railway Association to oppose the pipeline.

Vepco and Transco have already hired lobbyist William G. Thomas of Alexandria, a political confidant of Democratic Gov. Charles S. Robb, and Curry Roberts, a former aide to state Attorney General Gerald Baliles, to push the pipeline.

"They've decided to use a lot of big guns and so now we have to do something to counter that," said one railroad official who asked not to be identified.

Dalton, who left office in January after a four-year term and is widely believed to be considering running for another term in 1985, was on a hunting trip and could not be reached for comment. Richard Cullen, an associate of Dalton's at the McGuire, Woods firm, said that Dalton will not be "taking an active part" in the lobbying on coal slurry.

"However, as a former governor, in the coming weeks he will undoubtably be talking to individual legislators and this topic could come up," he said. "So it would just be on the safe side for the governor to register."

Cullen noted that Dalton had consistently opposed a coal slurry pipeline since his days as a state senator in the early 1970s. Dalton also serves on the board of CSX, for which he is paid $15,000 a year, according to a CSX spokesman.