Check the cam for wear at the point the seal rides -- if there is a groove, the only real cure is a new camshaft ($$$$). Also inspect the old seal for scores or cuts -- if there is a burr on the end of the cam, you will snip little bits out of the seal as it goes over, and it will always leak. Big problem on torque converters if you don't file the burr off the "fingers" that drive the pump, they slice the new seal every time!

Make sure the seal is in right -- the seal lip should go in, so that any pressure will push it down tight on the camshaft, not out.

I'd check the cam for play, too -- if the rocker carriers are worn, and the cam is moving a bit, it will leak.

Peter

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1972 220D ?? miles
1988 300E 200,012
1987 300D Turbo killed 9/25/07, 275,000 miles
1985 Volvo 740 GLE Turobodiesel 218,000
1972 280 SE 4.5 165, 000 - It runs!