Highland could very well be making money with Cu grades of 0.25%. I don't know the history of HV but I'll bet that their starter pit was higher grade at shallow depths. They can make money now that a lot of the Capex has been paid off. The same will be true for Schaft Creek after years of production.

The starter pit is not something that is simply up to drilling or management. It is either there or it isn't. It doesn't need to be dripping in gold and silver to make a good starter. The Paramount zone is only marginally higher than the overall main pit. But if Paramount were to be used as a starter pit, it would pay off capex about 1.5 yrs earlier than simply working the average grade of the main pit (about 9 yrs to pay down Capex). (@ $3.8B Capex, 1.75 gpt Ag, 2011 RE metal prices, 120 ktpd production).

Boosting Paramount production to 150 ktpd (at higher Capex $4.18B for increased production, all other parameters the same), the Capex gets paid off a year earlier still.

I am in the process of working on a starter pit model to better understand a more plausible scenario and tradeoffs between Capex, grades and production for paying off the mine in 3 yrs.

Imerc's post at the root of this discussion is a sobering view of the risk at hand. I don't agree with everything he said but I do respect his concerns.