Since my last post I tried to scope the cam and TDC sensors to monitor signals individualy and with respect to one another. Unfortunately one of my Picoscope probes died and I gave the car to some diagnostic specialists.

They had the car for a few days and found nothing.
In the meantime the owner has had more "discussions" with Pug Australia resulting in the local dealer offering to look at valves with a borescope which they did. They claim there is excess carbon buildup and that's the problem.

The owner wants me to do the work but I don't want to be blamed if it doesn't fix it! I'm not convinced that carbon buildup could cause such a severe problem. Particularly as this same dealer claimed to have used a super duper carbon cleaner product. I suspect they never did as the throttle body had certainly not been cleaned recently.

In the meantime the owner wanted the car back over the holiday period as it drives well once past this phase and will return it after the holiday season.

I've talked with a cylinder head specialist re the reported jacking lifter problems. He has never come across the problem and is doubtfull that is the issue here. Assuming the oil pressure remains contant and the valve springs are ok I'm inclinded to agree with him. One thing he did suggest is that if the valves have recessed at all then maybe there is some issue with the oil feed hole being blocked to some extent. Still you would think this would cause the lifter to not pump up and rattle which they are not doing. Of course I'm assuming that the lifter is a conventional design, maybe there is something odd about them?

The only other thing I can think if is maybe the valves are sticky in the guides momentarily allowing the lifters to pump up and hold the valves open for a while? Maybe this is the carbon buildup, though it would have to be very bad I would think.

I think this would have to be the most perplexing problem I've had!
Don't you just love this industry at times! Still boring its not!