Thank you to everyone for replying to this thread. Dealing with the responses I've had in no particular order I can state the following.
Save for creeping rust spot on front nearside wheel arch the car has no other rust on it. The spec is good: "sportline" version with usual "sportline" factory modifications, namely, smaller steering wheel, lowered suspension settings/stiffer s/absorbers and the leather which save for wear and tear on the driver's side bolster is near perfect.
Everything including cruise and electric driver's seat work, save for the air conditioning which needs a re-gas. I've had the gearbox reconditioned 25K ago and it works beautifully ( 5 speed variant).
When I bought The car I had the valve guides done, as well as replacing the headgasket which involved skimming the head.
In short I've tried to do everything maintenance-wise to keep the car for the long term.
As far as the leak itself is concerned I can say this. The car has hitherto always used oil. Prior to the leak I'd say problaby 1 litre every 500-1000 miles which I believe is perfectly acceptable and within acceptable limits given the age of the car.
Whenever the oil level would go down I would make sure it would be topped up- usually after a motorway run/ weekend getaway.
The driveway where I keep the car shows build-up of oil on the ground. Because I park the car in exactly the same place every day the build up of oil is quite noticeable. But this has not up until very recently bothered me. I appreciate that a lot of cars, and particularly old 6 cylinder mercs can and do leak and provided this is not excessive should not give unnecessary cause for concern. What makes the current situation different however is that I have noticed what looks like fresh oil, perhaps half a cup full on the ground under the car after having driven it. The leak seems to lie at the bulkhead end of the engine block. Its not AFT and its not break fluid; I am reasonably confident it is engine oil.
I can't say for certain because I haven't really driven the car for any length of time since this happened but the engine does not appear to be overheating....yet.
The oil pressure gauge reading remains unaffected 2-3, which is as it should be. There does not appear to be any oil in the coolant reservoir, and neither is there any creamy looking residue around the oil filler cap. So far the only problem seems to be that engine oil appears to be leaking from somewhere in the engine after the car has been driven.
Again, I would be interested to hear what anyone has to say about this. As before thank you in advance for taking the time and trouble to respond?
PS I'm not very familiar with this site, so as soon as I get a chance to take some pictures and find out how to post them I will.
