Was able to extract the broken rear differential cover bolt that I snapped the head off of.
Jacked the rear end of the YJ up in the air and secured with jack stands.
Lowered the rear axle so that I had just enough clearance to work on the broken bolt without interference from the fuel tank and skid plate.
Tried to center punch the broken bolt to make a place to start my drill.
Used a small left hand drill bit to drill through the center of the bolt.
Sprayed a bunch of WD40 as I was drilling.
Used a larger diameter left hand drill and expanded the hole in the bolt.
The bolt remnants gripped onto the drill bit spun out smooth as butter.
Threads seem fine. Just need to get a new bolt.
Still some noise when I drive and let off the gas. Not sure where it comes from.