a very small leak is near my oil filter, but not enough to explain for my 1 quart every 500 miles. I've noticed soot on my exhaust, but will wipe it clean and look at again shortly, other than that I can't explain the oil consumption. I've also checked the breather lines and all is good. So what could it be?? I've read something about the rings may not of sealed properly... could that be it?? Is there any way to test for that? I'd appreciate any info I can ask the mechanic to check out. Also if you guys know a engine expect in NJ let me know.. I seriously need to know what's going on w/ my engine. Thanks to all who reply.

Here's what I did and i'm sure some folks won't agree but I figured oil is cheaper than replacing the seals professionaly.

I switched oil from 10w30 to 10w40 and every oil change, I put some STP oil treatment - supposedly to seal some busted seals around. So far, the oil consumption has diminished significantly.

I know this is just a temporary fix but I just can't afford the labor cost to replace those seals.

That should reveal if rings/cylinder walls or valve guides are worn.

When I was using Mobil 0 10W30 my motor ate it right up! Gotta make sure it meets audi spec.

I'm using 10w60 M3 and M5 oil, bought it a BMW dealership.
I've had the head gaskets replaced, valve stem seals, lower oil pan, and pan gasket, oil cooler ring, and no leak. Still has this crazy oil consumption.