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Since the compression is lost on both #1 and #2 cylinder, Ariel - it high odds it is ‘only’ a blown (non-standard) head gasket…
While old/bad fuel may cause running problems or bad starting, there is little evidence that it in itself will cause serious engine damage. A ‘wet’ compression test should be carried out - if the compression does not come up, it is either the gasket or valves…and the latter is ‘unlikely’.
After a head gasket change, the head should be retorqued after 500 - 1000 miles, but the car is not expected to be running that little.
In your previous posts you mentioned that you had some starting/running problems. The engine should of course start easily and run on 4 cylinders, though not well - if the engine management is up to scratch. Which obviously is not the case recalling you previous difficulties, and advise given in that respect.
With two cylinders dead, the engine will pump out raw fuel out the exhaust - in addition to effects of other malfunction mentioned earlier. Which gives you something simple to do while musing on the head gasket problem…
Short term; disable the #1 and #2 injectors by pulling the electric plug - those two cylinders does no work anyway, and just contaminates. You may rectify the AAV and sort out the ignition timing, to ensure good starting and as good running that may be expected - though driving the car in this state is not recommended…
It would also allow for some further testing - encourage you to go ahead with the head…
Frank
xj6 85 Sov Europe (UK/NZ)
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The head must of course be removed, most likely only a head gasket change is required. If the head has been skimmed to the extent of requiring a thicker gasket is required - so be it, but it is unusual to skim to that extent…
Of course, with the head is removed other issues may appear, but I doubt it…