Before gluing my three pieces together, I made sure to pick the clearest piece for the front. This was necessary because I didn't want a knot or blemish to interfere with a thin area once I had everything cut out. If you look close you can see the pencil lines next to the arrows which is where I'll be placing my paper template. These lines are for reference to make sure I place my template in the right place once the glue is applied.

I'm used a center drill first and then went to the final size that I needed. If you're wondering why I have my work piece clamped down it's because it's very easy to have the drill walk off location when switching drills. Yes this operation takes a little longer doing it this way but it insures your hole will be in the right place. 
 

I got into high gear and forgot to take a picture of me actually using my bandsaw but I'm sure you get the idea. I made sure to stay just outside the line so I could sand the extra material later. Now it's time to cut the project in half.
 

Next it's time to cut the inner portion out on my bandsaw. To do this I'll be sawing from the outside into the hole that I drilled above. I'll follow my pencil mark with the arrow at both ends.

Note: This cut will be with the grain of the wood. This is important because I'll be gluing this back together later. By doing it this way I'll use the grain of the wood to my advantage in place of using end grain that doesn't glue as well.