I vaguely recall having the same issue on one of my cars (with an om617) and I rigged up a bushing to take up the space ovalled-out space - took a small piece of sheet metal and shaped it into a half-circle by hammering it around a bolt and crammed that in there around the bolt. Not a first-class repair but it has lasted several years.

If you can weld, it might be feasible to weld some metal into that spot and drill and tap it out. I don't weld though and have no idea how difficult it might be to do that kind of repair with the tight space constraints.