The Cat 3116 Engine has a common oil leak that is very easy to fix. The first step is to remove the steering pump which is driven off the air compressor. The next step is to remove the rear housing from the air compressor, it's held on with 4 nuts on studs, there is a square o-ring that seals the rear housing to the main compressor body. The Compressor is a "Bendix 850 Model" which is a 2 stage [2 cylinder] unit.
The Cat 3116 Engine oil pressure guage and air compressor oil feed lines run off the housing pictured here bolted to the engine block which is connected to the main oil pressure gallery. There is an o-ring seal between this housing and the engine block.
This 2nd block is the air compressor rear support block that has an o-ring seal as well. This block also serves as an oil drain for the 3126 model which has a oil pump above that supplies high pressure oil to the HEUI system [Hydraulic Electronic Unit Injectors].
Pictured here is the oil pressure manifold housing removed. The heat is absorbed by these 2 o-rings and they become very brittle causing an oil leak. Diesel Engines run from the "heat of Compression" so you can bet the engine block is smokin' hot! when operating temperatures are met.
The manifold housing o-ring has been replaced and is secured with 2 M8 Metric bolts. These 2 areas are a common oil leak in both the Cat 3116 Engine & 3126 Diesel Engine .
Recommended: Diesel Engine Repair Manuals