V40 2.0 turbo engine fault

[mateus]

Right then Volvo guru's, I'm here asking for advice on my sisters 99V V40:

Problem is leaking oil round the Turbo she has been told oil is entering into the cylinder and causing problems (some engine hesitation)
I'm pretty good mechanically and I can't believe this is the case there isn't clouds of smoke coming from the car although it is using oil,local garage reports oil in the exhaust. oil loss could be the oil seen round the Turbo?

Any common problems known with these? any advice greatly received.

Cheers chaps.