I expect it can be welded and re-machined, but I bet it's been like that for a long long time! A bit like when we pull barrels off and see cracked bridges and transfer ports... you're never sure how long it's been running perfectly OK with the "damage".
Although far from ideal, I would be inclined to build up the area with a good strong epoxy; something like JB Weld, and then dress it back to shape. Really you want to take the studs out so you can work with an unbroken flat edge.
I'm a bit concerned how the outside of the water jacket seals!

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Andy.
NSR-WORLD.COM
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