Shanster,

I think that is the oil pressure release valve. It lets oil from the oil pump flow back into the crankcase when the oil pressure gets to a pre set level.

That would explain why you lost so much oil when it came loose. Its not just a leak, its oil under pressure

If it comes loose again, I would remove what ever it takes to tighten it because if it comes out you could loose oil pressure and damage the engine.

P E H