Lost compression 1999 Passat

Hello-
I took my car into the mechanic today because the check engine light was continuously flashing and loud sound was coming from the engine. The mechanic told me that the engine had lost compression. He said it could be one of 2 things: the release valve in the oil pump not functioning properly, or the hydraulic tensioner/chain (?) Could be broken. He checked the timing belt and the timing belt was okay. Want to know if this seems right.I read some of the other posts and lost compression seems to be related to the cylinders not the oil pump. Thanks for your help!