YM1401 spitting black droplets from exhaust

The engine runs fine but the hood and my right side are getting covered in soot for lack of a better term. I called a mobile tractor repair guy south of me and he said he thinks a sleeve might be giving out. He also said he doesn't work on these Yanmars. Any suggestions? Anyone know of a mechanic anywhere near Dallas/Fort Worth? How hard is it to re-sleeve cylinders?
 
Winston, I had the engine rebuilt. The valves clearances were horrible on top of a handful of other issues. I'm not surprised as the machine is about 44 years old. Nonetheless, after spending more than it's worth, it seems to be running great after about 16-20 hours on it now.
 
It doesn't get better after a day of running it. Oil level is stable. I can't rule out coolant but that also seems to be stable.
 
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I have used Lucas injector cleaner, it has made no noticeable difference. I found a local diesel shop that will have a look at it. I'll bring it back from the country in about 2 weeks. I wish Hoye did service since they have all the parts and knowledge, it seems logical to me and they are 2 hours down the road. Thanks Winston
 

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