occurs when engine has been warmed up
by Visitor in Pompano Beach, FL on April 29, 2011
Timing chain hydraulic tensioner do this very often. The hydraulic cylinder separates inside the housing. DO NOT drive the car like this, it could cause a serious damage. Beside this, the 1,8T engine is notorious about building up sludge, causing all type of internal engine problems, so I wouldn't be surprised if there are additional problems existing.
Find a good VW specialty shop in your area and let them diagnose it.
A 2001 Passat does not have a timing chain. So that is undoubtedly not the issue...