For something like this, I would probably use PTFE paste, then covered with teflon tape. The paste does a good job of getting into the nooks and crannies that the teflon tape doesn't quite fill. Like vtpools said, pump off-remove plug-clean and apply sealant- reinstall-test. If using PTFE, my personal experience is to let it set a bit (a day?) before applying pressure.
Just a thought, if that's a skimmer plug, is it the same NPT size as that clean-out fitting, or is it maybe a little undersized and the proper sized fitting would work better?