A two-dimensional numerical method for inviscid two-fluid flows with a significant entrainment into both directions is established, and the oil leakage from a non-pressurized underwater pipe is studied. The interface between two fluids is modeled at a vortex sheet. The flow field and the subsequent interface evolution are solved by using the vortex-in-cell method. For longer flow simulation with a realistic two fluids interaction, an efficient merging scheme is introduced. In the Boussinesq limit, the speed of the external fluid intrusion into the pipe is very close to the existing mathematical models, and the lock exchange is observed in spite of a significant roll-up of the interface and entrainments. It is believed that the developed method can be utilized effectively for further detailed studies on various two-fluid flows which are encountered in many different marine oil spill problems.