I did a lot of searching on the net and one of the thoughts was a dodgy key not communicating with the immobiliser. Took spare key to work this morning (left vehicle there overnight) and it started no problem with spare key.

Here's hoping problem solved. Weird thing is though that the key which failed is the only original I have. My 2 spares are Chinese knock offs which I bought on eBay and had cut and programmed. I have been using the original key for over 2 years, no problems. I don't think it's the key battery as the remote works fine from a fair distance away.

__________________
2004 E53 diesel.
Titan silver on black
Sports package