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1989 Alpha 1 outdrive, with a 3 year old SEI lower unit, has gear oil weeping out of the little weep hole in lower unit. I suspect it is the seals in the upper as after filling the drive to capacity, it eventually begins to leak from the weep hole but will stop when I assume the upper is all leaked out. (This is happening without the engine running) My question is, how does the gear oil get to the upper from the lower when filling? 

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There are two seals in the upper case that go over the upper shaft, one goes upside down which keeps the water from getting into the gear oil the other goes right side up which keeps the oil from running out of the case. I just rebuilt my whole out drive and my water seal was completely gone and the oil seal left water into the upper gear set which caused the upper gear set to be ruined, water got in the bearings and destroyed the upper gears. It's a project to do if you are a little mechanical inclined. I did it so it's not that hard. You should have a book to tell you the procedure, the nut on the input shaft was the hardest part, make sure you lay the parts out exactly how they came out, exspecally the shims!! Good luck but I would say that's your problem.

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