The sludge is a combination of oil and exhaust emission meeting at the EGR valve inlet, the oil can be found leaking from the front bearing of the turbocharger but mainly from the breather system which is directly connected into the induction tube between the air filter and turbocharger on a tdi engine To achieve this a proportion of the exhaust gas is diverted back from the exhaust manifold to the inlet manifold via EGR valve unit to mix with the inducted charge, which is controlled via the solenoid which can be found on VW models at the back panel within the engine bay Original EGR Valve 1.9 Tdi 130 / 150 Engine