Looks like your particle slider in game options isn't all the way to the right as for why the smoke is probably bad.
That white thing isn't an oil slick. It looks like the flare reflection gone bad. Look way up high in the sky and see if you don't see a flare burning above the ship....
The oil slick starts out as some small spots on the water spaced apart that slowly grow over time into one big slick.
If you remove the FX_Update mod what happens? If FX_Update is the only mod installed what happens?
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