Guys need some help here.
I purchased a 99 996 for my son that is what I would call a fixer upper.

I have the engine out and when I drained the oil it had all of the signs of antifreeze in the oil. (Thick gooey crap)

Here is where it gets strange as I have had the engine on the engine stand with the crankcase pan, and both cam covers removed. I put a 70 psi water test on the engine for 2 hours with warm water and come up with zero leaks. Also have used die penatrant crack detector on both heads in the spark plug hole to valve areas and come up with nothing.

Anybody have any other ideas, or should we put it back together install it and moniter?

 

The issue will not be present until the engine is at temperature. Based on the model year of the engine it has a high risk of a cracked cylinder or a cracked head. The cracked head is repairable. The cracked cylinder is as well, with an update to a set of Nickies cylinders.

 

Here are some pictures of some cracked heads, including mine. The first place to look is at cylinder #1, inner exhaust valve spring seat. Also cylinder #6, inner exhaust valve seat. These are the most common areas for cracks, with #1 probably the most common. These are both of cracks at #1. The one without the dye is mine. I did not really see it until I had the cams removed. If you are going to remove the cams I have some diagrams for making the cam tools and alot of related info on how to do this.

 

Well finally found the problem. After heating the engine up to 180 degrees and 60 lbs of water pressure foud a 13mm long crack at the very top of #1 cylinder wall. Looks like either I'm going to take the set of good heads I have and use with different block and/or resleeve it.
Tanks for you help guys.

 

How many miles on the fixer upper for your son? Did you buy it right?

 

60k miles and 10 k purchase so I think we did ok

 

Yuck, what milage did that happen at? How come I have a feeling i am going to get to know my 996 engine very well in the next few years....

 

dont sweat it.... let it go and drive it like you stole it.

 

I'd say you got a superb price and decent value, and you went into the deal with your eyes open.Congrats!