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BL: Your situation makes me think that you have a severely worn diesel rings/bore that is causing the blow-by of the diesel to overwhelm the small passage through the pony block, up through the top block deck, and up the pipe to the pony breather. If you remove the small pipe I'll bet you see a steady stream of blow by that is impressive. This over-pressurizes the pony air cleaner, and it gyrates any oil in the pony oil bath, and it fogs its way into the pony intake, increasing the oil that the pony has to burn. "All Pony's smoke" is an easy way to describe virtually all non-maintained, 50 year old starting engines. I overhauled mine a few years ago, replaced pistons, rings, valve guides, and sleeves where necessary, honed it properly, and it does not smoke. At idle, wide open, under load for 4 or 5 minutes at a time, it does not smoke. The oil control rings in these ponies do not last long when they are subjected to cold, raw gas starts, and most ponies smoke because the rings and bore are worn, and the valve guides are sloppy. Also check the oil drain back hole in the heads as it is not much over 5/32" in diameter. Almost every diesel that is black around the pony is worn to the point that it cannot vent all the blow-by that is present. I have seen them blow by so hard that when putting out full power on a dyno they blow the oil bath cup off the pony air cleaner. The black goo you see coming out of the pony exhaust pipes is a combination of soot from the diesel, oil from the diesel, oil from the pony, and diesel fuel residue that has accumulated over time from the high volume of blow by that is saturating everything it can with this oily mist. The fog can make its way through the block to the air cleaner, then it condenses and drips into the pony intake manifold where it waits to be blown into the exhaust pipe. Get the pony firing properly, and warm it up, and run it with some fresh oil for an extended period of time. It will begin to heat up the exhaust and burn the crud out in short order. Be sure to do this in an open area, well ventilated. After this, make some calculated observations and I think you'll see that only a severely worn diesel engine can produce that amount of blow by. After I rebored and installed new pistons in the course of my 70D project, you can plug the pony vent pipe, and remove the oil filler cap, and it will barely lift a playing card. That is how they are supposed to be.
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