The problem probably is that the timing belt broke.  Remove the cover and
check this out.  This is not that uncommon if you don't replace the belt
every 60-90k miles.  The diesel engine is an interference engine so he has
bent a valve and perhaps damaged a piston or rod.  He is looking at a rebuilt
or used head and perhaps some bottom end work.

Hope this helps,
Ken Wilford
http://www.vanagain.com
John 3:16
Phone: (856)-765-1583
Shop:   (856)-327-0027
Fax:     (856)-327-2242