Either the oil pump housing is chewed out or the bearings have failed. These engines do have an inherent oil pressure issues in regards to oil flow to #1 cylinder, main journal and through the head. If the engine is starved of oil (or the engine is simply worn out), it can potentially do catastrophic damage from loss of oil pressure. Biggest culprit for oil pressure loss is the balance shaft bearings being worn out past their serviceable life. Doing a balance shaft delete solves a couple of potential problems but that's a different matter. Don't know if you've done an oil flush yet but that may help. I did a write up on my method and everyone so far has given positive feedback on results.