"Blowing a gasket" refers either to a car engine, usually when it's the head gasket that's gone in a billowing cloud of white smoke, or when someone goes beserk.

Here I think it's simply a seal between parts on a pipe, in the flanged connection between a pipe section and a valve, say. A lot will depend on the size of the pipe. If the size of the pipe that takes water to your handbasin, then "washer" might be appropriate (even if I said above that makes it sound more like taps). But if this is an industrial process that's leaked, I'd go for "seal" or "gasket".

"Blowing" implies, amongst other things, pressure (see head gasket, going berserk). It might be applicable in your case. Otherwise just "a gasket goes" or "a gasket gives way/out" or "a gasket fails".