I finally found the source of this high pitch noise - it's EBOX cooling fan part# 12907572985 -
https://www.realoem.com/bmw/enUS/sho...47#12907572985
Does anyone know where this even located in E70 and how hard is it to replace it?
It looks like it's well known issue in 3-series -
http://forum.e46fanatics.com/showthread.php?t=1053216