Looks to be oil fouled. Did a leak down test and seems ok. No sign of smoking. Did a compression test and looks ok. Used a bore scope and couldn't see anything abnormal but the picture wasn't that clear.
Postscript: Looks like I might have fixed the problem. Removed the right hand vanos solenoids and flushed them out with carby cleaner. I didn't realise the mesh filters were so fine. Very easy to block. Looked clean but looks like they weren't. Car runs a lot better and no sign of any warning lights or errors generated. There may be a slight hesitation on hard acceleration but the car is quite drivable.