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I tore apart my '72 400 motor to replace the timing belt (among other things), and I found a nice ring that was sheared into the cover:
The culprit?:
There also was another circle on the other side where the water pump impeller might've rubbed. I also found pieces of the nylon timing gear in the bottom of the oil pan.
My questions to the engine gurus is, what could have caused this, how serious is it, and what do you recommend I do about it?
I agree. When I tore down my 400 to change the timing chain, the thrust plate bolts had backed out and were in the bottom of the pan, have no clue how long it was like that. Luckily it did not cause any damage.