subaru O2 P0130

I have a 2001 Subaru Impreza RS. The 2.5 engine has only 49049 Miles on it. It is a stick 5 speed trans. The car was hit and the timing belt torn. I repaired and retimed but found cyclinder 1 and 3 had bent valve and so I had the head on that side removed and the valves replaced. Now the engine runs rich and continues to throw an P0130. The Bank 1 sensor 1 O2 sensor is functioning oddly returning a value of 7.9 volts. The post cat O2 sensor acts more normally fluctuating slightly but centering in on a value around .7 The engine also sets a misfire code for cylinders three and four. I did a compression test and returned 190 for cyclinder 1, 190 for cylinder two, 180 for cyclinder three, and 195 for cylinder four. I don't think the compression is the problem because the missing occurs at rpm above 2000 not at idle. What is causing the rich fuel mixture? It seems like the ECU should be shortening the fuel pulse since the O2 sensor is returning such a (rich) high value.

cam timing! vaccum leak!

Thanks Jeff,
I tested the vaccum, a steady 19 inches, and took the covers off to look at the timing. Belt marks line up exactly with the camshaft and crankshaft markings. I did adjust one notch on the timing belt just to see what it would do. Cylinder compression jumped to 205 in cylinder number one and 193 in cylinder number three. Unfortunately the car now backfires anytime you put it under load. I thought the belt seemed loose. Is it possible that the lower than normal belt tension could cause camshaft timing to be off slightly?

could!

I replaced the belt and tensioner and still have the same symptoms. O2 registers a very rich mixture and the car has a random missfire and backfires when given heavy throttle. I'm not sure what to look at next. I drove it around 50 miles today with no change in symtoms.