We get this question quite a bit regarding the oil flow / circulation in a Pontiac V-8 engine.  The lower hole on the outside of the block where the oil filter adapter bolts to is the “oil out” hole.  The oil comes up from the pump and out of this hole into the filter.  The oil then leaves the filter and goes back into the block in the top hole.  Note the white arrows in the attached drawing courtesy of the Pontiac engine manual.