I pulled the noisy 261 out of my truck this weekend and dismantled it. (150 miles)

Here ared the results:

Foreign material in the oil trashed all the rod bearings and to a lesser degree the mains. The freshly ground .010/.010 crank mics OK, however it has some serious grooving issues espically on the rod journals, mains look better but still have some minor grooving. The camshaft and cam bearings look good as well as the cam lobes and lifters. Rods, pistons and rings look fine.

When I started this rebuild, I sent it to an engine rebuilder in Phoenix. I told him the engine was sitting outside in a Flagstaff Junkyard for at least 20 years and was frozen when I disassembled it. I asked him to give it a thourough visual exam and magnaflux before starting any machine work. He cleaned the engine and found 2 small steam hole cracks between the #1 and #2 cyclinders and #5 and #6 cyclinders. At this point he called me with the crack info and recommended scraping the block. I found a diesel heavy equipment machine shop in Phoenix that said they could fix the cracks so I took the block to them for repairs. They fixed the 2 small cracks and said they could do all the he other I needed (Boring, balancing, rod rebuilding, crank grind, head work, etc). They did all this work thinking that the other shop thouroughly cleaned the oil galleries when they magnafluxed the engine and did not re-dip the block.

I assumed that the block as clean internally as it was externally and carefully put all the pieces together in as clean of manner as I could. The problem is when I primed the oil pump prior to start up I unknowingly put a fresh coat of Flagstaff volcanic dirt on all the bearings. RESULT-LUNCHED BEARINGS IN MINUTES.

I'm going to try this again, only this time with a ultra-clean block, new bearings and a .020/.020 crankshaft. Hopefully I can re-use the rings, they still show the break-in grooves.