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Try making a small knife cut on back, deep enough to penetrate the brown stain. The cut should be silver colored. Lead doesn't oxidize or tarnish. It is very malleable and bends easily. Lead will not hurt you to touch it, only if you eat it or inhale it.
Sheet lead can be purchased for roofing and plumbing. A piece your size may have been used to copy a hippocampus design. Hammering the backside lightly would capture the design, chisel marks, carvings, etc. on front and leave the back all puckered up (as it is).
Lead does oxidise, it is well documented, oxidisation is a form of corrosion, tarnish is a result of corrosion, therefore lead does tarnish.
It is not so much the touching of lead which leads to lead poisoning, it is touching lead which has oxidisation on the surface, however microscopic or not it may be at the time, which ends up on your fingers and the lead oxide then making it's way into your system via cuts, scratches or eating without properly cleaning off the lead oxide.
Lead will oxidize when heated to 600-800 degrees Celsius. It does not oxidize in water. It will corrode (turns white) when it comes in contact with acetic acid (found in wood).
I quote Wikipedia:
Pure lead has a bright silvery appearance with a hint of blue. It tarnishes on contact with moist air, and takes on a dull appearance the hue of which depends on the prevailing conditions. Characteristic properties of lead include high density, malleability, and high resistance to corrosion (due to passivation).
I quote myself:
there red are different oxidation states of metals and depending on how those combine with other things (like oxygen, carbon, chlorine, or whatever is around) you get different colors like a lighter gray. I used to have a block of lead I cut slices off of with a band saw and the outside was dull and the inside was bright and shiny much like what is going on with this hippocampus if I scratch it. I've also seen red and yellow produced from lead oxides in the lab.
Generally lead doesnt corrode it hangs around for a long time like copper but it does oxidize again like copper.
Yes, you can heat lead to rapidly force the create of lead oxide and under normal conditions lead does not react with water. However, when lead comes in contact with moisture in the air reactivity with water increases. Thin layers of lead oxide (PbO) form at the surface of the metal.
The matter lead oxidising or not doesn't really matter at this stage, only John has the item and only John can determine if what we see in his photos is actually dirt, oxidisation, impurities in the lead or something else entirely.
Further to this here in England we have many beautiful old churches the one at Kentisbury, Devon was built by one of William the conquerors nephews over 900years ago and it has several original lead gargoyles which show very similar oxidised patinas to this item.