The seal in your hydraulic pump has failed. The bearings/shaft in the pump MAY be worn as well, which will cause repeat seal failures, if that is the case.
The hydraulic pump is located at the REAR of the engine, above the flywheel housing, and driven off of the accessory drive above the camshaft.
IIRC, there are TWO seals, one in the pump and one one the accessory drive side. It must be getting past the pump seal and working INWARD past the accessory drive seal, if that's how it's set up.
(Those engines are a bit ODD, in that the timing gears are at the REAR of the engine.)
You can look at the parts catalog at the link below, by entering the model #. At least three options will come up for the 700, by serial number and series. The ENGINE side isn't shown, you'd have to look in a Cummins parts catalog for that.
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