GOOD NEWS
Yamaha Canada has approved to pick up the tab for all the parts and 7 hours worth of work (my garage estimates it will be closer to 14 - but who cares)
My Garage informed me that once they reached out to the local Yamaha Tech - the guy drove to the shop to look at the issue and within an hour he had approved the work above, for a couple of reasons:
1)Yamaha has seen this issue once in the past (not sure where: Canada/USA/Europe etc..........
2) The oil was new - has been changed about 1800 KM prior and I have 5 oil changes within 18K KM on the bike
3) All the parts to the Engine Head and higher will be changed !
4) My garage removed the oil pan, clutch cover and I believe another side of the engine and they could not ding any particles of metal
5) Finally and the most important both Yamaha and my dealer are confident that my bike will run like new !
To all the issue was a pin (# 8) per the schematic above that got blown out, they where not able to find it and another good point is that this occurred at start up and that I was able to turn the engine off quickly, could have been worst if I was barreling down the road at 70 MPH . The motor was never starved off any oil, there was sill about half left based on the readout from the little window on the side !
I wont see my bike anytime soon since 2 of the parts are back order - time to get a good night sleep!