This is an extremely common problem on the M112 engine. It is leaking from the breather cover(s), with leaks on the passenger side more common. On both my E320 and SLK320 it started leaking at about 90,000 miles. Here is a picture of mine that I posted about 6 months ago. http://www.benzworld.org/forums/w210...aking-oil.html
It does not have a gasket and you need to use "gasket maker" compound. I did it about 2,000 miles back on my SLK and will do it on my E320 as soon as it gets to the next oil change. It is not a very difficult job, but it does take a lot of time to clean the covers properly. I took me about 2 hours to do the passenger cover, 10 minutes to remove, 1 hours 30 minutes to clean, 10 minutes to apply the gasket maker and 10 minutes to re-install.
I used this article as a basic guide: Resealing the Recirculating Cover on M112s - CrossfireForum.org
It was posted in the Crossfire forum, but is EXACTLY the same as my SLK320. There is a slight difference in the E Class, in that we have an additional intake damper that have to be removed or swung aside. The most important thing if you use the method in the article, is to ensure that none of the old gasket ends up in your engine. After removing the breather covers, I first dried the chambers completely with paper towels, making sure to suck up all standing oil. I then plugged the 3 holes with paper towels. Only after this did I start removing the old gasket, always cleaning to the outside of the chamber. Once cleaned, I vacuumed the chamber out and gave it another good wipe-out. To clean the gasket from the breather cover, I used some brake cleaner aerosol as an initial starter, followed by manual cleaning.
O yes, very important!! You'll notice that some of the threads refer to an 8Nm torque. That ONLY applies to the large bolts - NOT the small ones. (Don't ask me how I found that out
In spite of what some people believe, you don't have to go to the MB dealer to buy the gasket maker. Permatex Black works perfect.
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