One of the main leaking points was, you guessed it, the IMS shaft. When the bearings would start to die, the free play and whip of the shaft would trash the seal. The oil leak was often a precursor to catastrophic IMS shaft bearing failure.
All is not lost though, many companies make aftermarket heavy duty IMS shaft bearings. There are improved ceramic bearings available, pressure fed sleeve bearing conversions and roller bearing conversions that are all better than stock. An EPS Roller bearing conversion kit is pictured here.
If you own an early M96, upgrading the IMS shaft bearings is mandatory no matter what the service history of your engine is and no matter how you use the car. A failure of the bearings will result in the destruction of the engine, and Porsche stuff isn’t cheap. Having good IMS bearings will also improve the resale value of your car.
Strangely enough, like the IMS shaft failure, the D-chunk failure is more common in garage queens and lightly driven cars, rather than track driven cars or cars that are driven hard. No one really understands why and there is no data to back this up, only anecdotal internet forum talk.
LN Engineering has a cure for D-chunking where the cylinders are machined out and replaced with thick, sturdy Nikasil sleeves. This repair method has a good reputation and is considered to be bulletproof even for heavily modded and forced induction engines.
Man is this M96 engine one big turd. All of the Porsche tuners we know that build Porsche motors roll their eyes when you talk about the M96. The most common advice we have heard is if your car runs, sell it and buy a later model!