I have finally had the problem diagnosed. According to Volvo Villa here in Toronto it's the drive shaft centre bearing that is making the noise. I got under the car with the mechanic and could her the noise coming from the bearing. Unfortunately the bearing is part of the rear drive shaft assembly and can't be replaced on it's own. This part for my car is $1140.00 Canadian and takes 1.5 hrs to replace. The parts vary in price depending on the serial number of your car due to slight chassis variations. Thank god for my extended warranty. I'll report back when the job is done.
Steve
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