1987 60 HP Merc rebuild exhaust/water leak

[Jumbo3905]

After installing the powerhead after a 1987 60 HP Merc rebuild there is a "blow by" water leak from the lower Powerhead gasket.
What might be causing this leak. Should there even be exhaust (with water) getting into this chamber. Motor runs fine with the cover off, but when the cover is installed the Motor seems to choke itself.
Any help appreciated.

[Dave S]

If your not carefull and get all the old gasket off......

[Jumbo3905]

I had the two mating surfaces cleaned right up. Is there exhaust /water able to get to this section of the motor. I thought it should all go down the exhaust pipe to the lower unit and out the prop?