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Reply to "Is there any kind of seal on the dipstick where it enters the hole in block?"

To add to Chuck's description, there are two pieces to the Pantera dipstick tube guide. They meet at the block surface and the sealant is to leak proof the joint. Maybe your upper tube came loose and sealant got inside. The loose fitting guide clamp behind the alternator sometimes gets rotated 180 degrees and misaligns the two guide pieces down below.

The Mustang 351-C dipstick did not have the upper tube so on early Panteras, to check oil you had to remove the engine screen, reach forward and grope for the short dipstick. Returning it to the hole was virtually impossible unless you laid on top of the engine with a flashlight! That long bent extension added for Panteras was an engine saver, as otherwise most owners wouldn't regularly check the oil!  The situation is shown in the BLUE '71 Owners Manual (p38) but was fixed even before the TSBs came out.

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