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I'm getting a "ticking"noise from the engine, sounds like it is the cylinder head area. Somedays its louder than others.

Could it be tappet adjustment, or could it be camchain adjustment required. The car has been regularly serviced, but has done only 55k kms. It is a 1999 T6.
 

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The oil pan o-rings are known to go bad on those cars causing the tapping noise.If you check the oil pressure it will probably be a little low.
 

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Oil pump seal problem in earlier reply can cause oil starving the upper part of the engine. Do the oil pump fix (essentially an oil pump rebuild kit) ASAP. Fixing this problem early will save many dollars over the long run. If the noise goes away after the oil pump fix, you have lucked out. If not, you are likely to have trouble in either or both of the following areas:

1) Lifters -- Oil starvation and resulting excessive wear can cause a collapsing lifter problem. If this is the case, the noise will occur after the car has set overnight (lifter leaks down), and MAY go away after a few minutes of engine run, depending on the severity. Lifters are presently dealer only for the S80, and must be purchased as a set ($400 - $500 range). Repair should be done as soon as practical, but can be put off for a limited time.

2) Cam Shaft Journal scoring -- This is a worst case scenario from the standpoint of repair cost and potential engine damage. Oil starvation results in scoring of the Cam shaft journal on the journal farthest from the pump. As the camshaft does not use inserts, this is likely to necessitate a head removal to polish out scoring on the journal saddle. Although the camshaft journal may possibly (depending on severity of damage) be built up and re-machined, it is advisable to use a new camshaft. In a severe case, the bearing cap for the journal in question can crack and cause a ticking noise that sounds lifter like. In this case the tapping noise frequency will vary as a function of rpm, may come and go, may be absent on first startup and appear after the engine is run for awhile, and will appear more frequently and get worse over time. IF THIS IS YOUR PROBLEM, IT MUST, MUST BE FIXED ASAP.
 

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Not to step on any toes but the oil pan o-rings would be the first thing to check.They were having the oil pan o-rings problems for atleast 5 years now.I have only ever seen a bad oil pump in the 6 years I have been working on Volvo's for the dealership.There was so much of a problem with they they changed the o-rings they were using.There is 2 o-rings between the oil pan and the block.Also there is your oil pump pick up tube o-ring which is usually the one the tears and does not allow the proper oil pressure to be reached do to oil leaking back into the pan at the torn o-ring.
 
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