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This could easily be the water pump, despite the low miles. First check off the resevoir and all of the hoses, particularly around the thermostat housing (both the big hose and the little vent hose - my vent hose was loose at the housing and leaked there, just about out of sight). The water pump is behind the timing belt cover panel, so you can't see it leaking directly, you only see the coolant leaking out right at the bottom, usually onto the lower engine mount area. Our '98 XC just had its pump replaced for the second time at 91k. First time it was done with teh T-belt at 70k due to slight seepage that was only seen when doing the belt. However, that pump let go just as you describe, only 20k later. These pumps seem to have a very varied life, although usually they go for a good long time. Our Indie charged about $450 for the job, including new drive belt and flush of rest of coolant, since that was up for doing as part of the 90k anyway.
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Mike Sullivan ('95 855T (88k), '98 V70XC (92k), '95 855 NA (135k). Past Volvo's: '85 744 (256k), '86 245 (165k), '86 245 (195k), '88 745 (208k), '91 745 (196k), '93 965 (147k) .
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