Which Chapter and Khanda of Siva Purana has the story of Kalavati, the daughter of King of Kasi gets the panchakshari mantra from Sage Durvasa ?
This story is NOT found in the Śiva Purāṇa. It is from the Skanda Purāṇa.
This story you cite, is narrated in the Purāṇika Encyclopedia by Vettam Mani (author), and most unfortunately, the author mistakenly attributes the story to Śiva Mahā-Purāṇa, when in fact this story is found in the Skanda Mahā-Purāṇa.
Here's the Story cited by Vettam Mani in the Puranic-encyclopaedia -
A daughter of the King of Kāśī. This gem of a woman worshipped the sage Durvāsas and became a saint by obtaining the Śaiva Pañcākṣara (five letters pertaining to Śiva—Sivāya namaḥ). Afterward Dāśārha, King of Mathurā, married her. The King felt very hot whenever he approached her and he questioned her about it. She said she had received the Pañcākṣara Mantra even from childhood and sinners would feel the heat if they touched her. The King was greatly disappointed and Kalāvatī took him to Sage Garga to redeem him from all his sins. The sage dipped the King in the river Kālindī and when the King rose up all his sins flew away from his body as tiny birds. The King reaching the palace, embraced Kalāvatī and then he felt her body very cool and pleasant. They got a son also.
The story of Kalāvatī, daughter of King of Kāśī, receiving the Śaiva Pañcākṣara mantra from the sage Durvāsas is found in the Skanda Purāṇa -
तृतीये ब्रह्मोत्तरखण्डे पंचाक्षरमन्त्रमाहात्म्यवर्णनं नाम प्रथमोऽध्यायः
Pañcākṣaramantramāhātmyavarṇanaṃ nāma prathamo'dhyāyaḥ
Chapter 1: Verses 28 to 48 - The Greatness of Pañcākṣara (Five-syllabled) Mantra,
Section 3 - Brāhmottara-khaṇḍa,
Book 3 - Brāhma-khaṇḍa, Skanda Purāṇa