Originally Posted by
Atimm693
Not necessarily. 2 strokes drool a lot of oil, it's not unusual to get some oil dribbles out of the lower unit.
Those holes are there to drain all cavities of the lower unit and prevent freezing. On the Merc that I used to have, you had to trim it up and then down to get all the water out.
Drop the drain plug (leave the vent installed) and take an oil sample, see if it's milky or has water in it. Usually, if oil is getting out, water is getting in. I had trouble with this on my Merc as well, the shift shaft seal was the culprit.