The Soviet-era plant, constructed in 1966 directly on the shore line, bleaches its paper with chlorine and discharges the waste into the Baikal, which holds about 20% of the world's total fresh water.
"The removal of the facility will be costly. But this cannot be compared with the value of trillions of cubic meters of the purest Baikal water," said the governor of the region, where the plant is based.
"We are speaking about quadrillions or a million billions dollars," Tishanin said.
The governor said the authorities should devise a plan which will see the pulp mill moved from the lake to another area in the region. He also claimed that all costs should be paid by the government.
Lake Baikal, located in East Siberia, is the deepest lake in the world and home to more than 1,700 species of plants and animals.
The Baikal plant has already been involved in a dispute with the Russian environmental regulator which accuses the company of water pollution and working without a license.
Rosprirodnadzor said in late January that contamination of Lake Baikal by the pulp mill would cost Russia 2 billion rubles ($83.9 million) per month.
The plant has promised to switch to a closed water cycle by September 15, submit a planned set of measures to reduce pollution of underground aquifers by April 28 and a draft plan for non-incineration waste disposal by June 28.
The Baikal paper and pulp mill produces 200,000 metric tons of pulp and 12,000 metric tons of paper per year. The mill is owned by the timber industrial company Continental Management (51%), controlled by Russia's richest man, Oleg Deripaska, and the State Property Committee of Russia (49%).
