I previously though I was burning oil. I was wrong. I have a pretty significant oil leak. Put in 2 quarts about 1 week ago and it has now leaked to the point low oil sensor light illuminates.

I have not been able to pinpoint the source. It appears to be on the drivers side above the starter. I can not see the oil leak source from the top of engine. A lot of oil has blown back so the picture might be a little deceiving. I circled in yellow the area where I think it is dripping down.

It is not the oil pan gasket as the oil is from above.

I have checked the following and found no oil leak.
oil pressure sending unit
oil filter
head gasket on the passenger side
head gasket on the drivers side as well as I could
where dipstick goes into engine

What is above the starter that might be the source of leak?

I did replace the oil pressure sending unit. When I took the old one off it did not have a washer, so when I installed the other one I did not use a washer. Maybe that is the source of the leak. It is hard to tell since the oil does not drip strainght down from the sending unit. Does anyone know if there should be a washer used when installing?

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I don't know how it could cause oil where you have it, but the fan can push oil everywhere.

Have you checked the

1) Front timing cover
2) Oil level sender O-ring (on oil pan)
3) Valve cover gasket at the rear of the block by the half-circle of rubber


-tp

Yes, you should have a aluminum seal ring sealing the pressure sending unit.

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90 300TE 4-M
Turbo 103, T3/T04E 50 trim
T04B cover .60 AR
Stage 3 turbine .63 AR
A2W I/C, 40 LB/HR
MS2E, 60-2 Direct Coil Control
3" Exh, AEM W/B O2
Underdrive Alt. and P/S Pulleys,
Vented Rear Discs, .034 Booster.
3.07 diffs 1st Gear Start

90 300CE 104.980
Milled & ported head, 10.3:1 compression
197° intake cam w/20° advancer
Tuned CIS ECU
4° ignition advance
PCS TCM2000, built 722.6
600W networked suction fan
Sportline sway bars
V8 rear subframe, Quaife ATB 3.06 diff

try first to dry all the oil, that may show where the oil is coming from .

then have a look to the steering shockbreaker .
good luck

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