I first tried a carefully fitted gasket and permatex...it leaked.
After a year of watching the d*mn thing drip I tore it apart and installed an o-ring, seemingly a better choice.
It's easy to cut the grove with a small lathe. Chuck the housing with the sector shaft inside, now you can run a live centre off the already centre-drilled sector tip.
These pictures might help.
I rounded the tip of a tool bit and, with it, cut the grove just a smidge deeper than half round. Rubber grease the O-ring so it can slide for adjusting.
I also installed a lip seal on the shaft, plus needle brgs and the common tube seal at very bottom.
This one's been assembled (full of 600w) for a number years now & nary a drop on the cement floor.