Replace Packing
If tightening doesn't slow leak up to about one drop every 20 seconds while the shaft is turning, then it is time to replace the packing. With the boat out of the water it is not a complicated job, although it is an akward place to work (behind the engine). You simply must remove the old packing around the shaft and put new packing in. Most marine stores will sell you a tool for getting the old packing out. It is an awl with a bit of a twist near the end to reach in and snag the packing and pull it out. Usually, there are three layers. Once you have it all out (you do this with the boat out of water, of course), you need to take the old packing to the marine store and get new packing of the same size. They can help you match the old packing. You then cut the packing to a length such that it will just go around the shaft and the ends will nicely meet. Put three layers in, with the joints staggered. Then tighten your nut back down. You do not need to remove the engine, or anything drastic like that. Just back the tightening nut way off, get the old packing out, and put the new packing in. The hard part is laying on top of the engine while you do this; otherwise, it is fairly straightforward.Good luck.