I noticed a small oil slick on the water around my motor this morning and there was a strong oil smell. There are no cracks or damage to my lower unit and I can't see where the oil is actually coming from. The motor is running great, but I would like to fix the issue before it becomes a much larger issue. I am guessing that I might have a leaking seal. The motor is a 2011 Mercury Optimax 200 with less than 200 hours on it. What do y'all think?

Was the lower unit oil changed recently? Sounds like a missing or broken gasket/seal on either the drain or the vent screw.

I would drain oil to see if any water is in it and how much is missing and check screw gaskets....

Loosen the lower plug and check for water. You should be able to tell where the oil is coming from. Have the lower unit pressure checked.

Thanks. I will check the oil. It just barely makes a small oil slick when in the water and I can't find any leaks when it is out of the water.

You need to check all of your oil injection under the cowling. Run it on a hose with the cowling off and look.

I may be over simplifying this, but you might want to pull your prop and check for fishng line. It's never happened to me, but I've heard it can get behind the prop and eat the shaft seal away. Good luck with it sir.

Great news! I changed the lower unit gear oil and it looked pristine. No water or metal shavings. I checked under the cowling and it looked like it just came off the show room floor. Turns out that the oil slick was coming from some grease that was on the grease fitting on the engine mount. I gave it a thorough once over and couldn't find anything wrong. Better safe then sorry, right?

Awesome!