Here is a quote from a CBS executive:
Transferring STAR TREK: THE NEXT GENERATION® to high-definition presented numerous challenges – The series was originally shot on film and then transferred to videotape, which was used to edit episodes together. In order to create true HD masters, CBS is going back to the original uncut film negative – all 25,000 plus film reels of it – and cutting the episodes together exactly the way they originally aired. The visual effects were all shot on film and will be painstakingly recompositioned, not upconverted from videotape. The newly cut film will then be transferred to true high-definition with 7.1 DTS Master Audio. Denise and Mike Okuda are consulting on the project.
While the first full season won’t be available until later in 2012, CBS Home Entertainment is releasing STAR TREK: THE NEXT GENERATION® – THE NEXT LEVEL, a single Blu-ray disc to give fans a taste of the series in HD, on January 31, 2012. The disc will include the feature-length pilot – “Encounter at Farpoint” – as well as two more “fan favorite” episodes, “The Inner Light” (Season 5) and “Sins of the Father” (Season 3). The single disc will be available for a suggested retail price of $21.99.