MG Car Repair: cylinder compression, blown head gasket, piston ring

Question
USA 73 MGB Roadster:

While driving recently I got a backfire of the engine and the car began to ride rough.  I checked plugs and wires and all was good.  Every cylinder was getting spark. However, while compression in the 2, 3 & 4 cylinders was 110-120psi there was no and I mean no compression in the number 1 cylinder.  The plug appeared to be oily.  Could this be rings, head gasket, linkage, burnt valve?  What further tests can I do to isolate the problem?

Thanks,

Answer
A broken ring would give low compression.  A blown head gasket ditto.  The only thing that gives zero compression is a burnt-out exhaust valve.  With unleaded fuel, this is not uncommon.  The backfire is quite typical with a burnt-out valve.  

You could double check by putting an eggcup full of oil in the plug hole to make a temporary piston ring, and see if you can get some compression, but I am sure it is a waste of time.

If I were you I would lift the head.  It doesn't take long.  You may get away with replacing one valve, but I would fit a set of 4 stainless steel exhaust valves.