What does this do and does it go their??

This is from a 84' VF500 ceptor.

I'm still getting things in shape before I can actually ride her for the first time.
I've owned her for 3 years.

The PO had told me that water was getting in the oil.
After new head gaskets....well, I replaced the front heads and he replaced the rear head gasket and (I don't have faith in his mechanical skills) there doesn't seem to be any water getting into the oil.

But as you can see from the picture below, I was visually inspecting the water pump and decided to remove the oil pan...And I find this!

I couldn't see anywhere else it could go, so I proceeded to place it back in the hole as far as I could push it in.

BUT here's the thing, I see a bearing right behind the seal that I just pushed in. How does it receive oil???

I really don't want to start the engine again for tuning until I figure out what this could possibly be and where it properly goes.

LL

 

Bump please....