Russian President Vladimir Putin surprised oil executives and environmentalists this week by backtracking on an earlier decision about a controversial planned pipeline route near the UNESCO-protected heritage site of Lake Baikal.  Environmentalists are hailing the decision, while oil company executives are scrambling to determine the expected additional costs.

President Putin caught everyone off guard this week when he ordered that a new oil pipeline be built at least 40 kilometers North of Lake Baikal, the deepest freshwater lake in the world.

Mr. Putin made the decision during a meeting with Siberian governors and cabinet ministers in Tomsk. He said the pipeline must be rerouted, if there is even the slightest danger of polluting Baikal, which is home to more than 1,000 species of unique plants and animals.

It was a stunning reversal, given that President Putin some months back called opponents of the plan, "saboteurs" in the pay of (unspecified) foreign governments. It also signals an end to a bitter struggle that had threatened to grow increasingly public.

In recent weeks, Russian scientists and environmentalists had begun staging strikes, accusing members of government regulatory agencies of being pressured and intimidated to sign off on the deal.

Moscow Ecologist Alexei Yablokov, of the international environmental watchdog group Greenpeace, welcomed Mr. Putin's decision as the group's greatest victory.

Yablokov notes, in comments broadcast on Russian radio Echo Moscow, that the decision was not without protest. But he and other activists take heart saying that, in this case, the Russian people have been heard.

Activists like Yablokov say the decision also bodes well for future environmental concerns in Russia, of which there are many. In the case of Baikal, environmentalists were worried the pipeline would be vulnerable to breaks as Baikal is located in an earthquake-prone zone.

Work on the pipeline, intended to transport Russia's vast oil reserves across Siberia to lucrative Asian markets, reportedly started Friday, three months earlier than expected. Reaction to the rerouting among executives of the state-owned oil company, Transneft, which plans to build the new pipeline, was decidedly more muted.

Deputy head Sergei Grigoriev acknowledges the debate has been closed with President Putin's decision.

But Grigoriev and others say the pipeline's initial cost of $11 billion has just gone upwards by several hundreds of millions of dollars, with President Putin's simple wave of a hand.