is that an exhaust leak, or a valve leaking. If it is an exhaust leak, it could be just the exhaust gasket or manifold, if it is an exhaust valve that is bad, then it mean more involved issues. I previously mentioned checking compresion, a leak down test would futher investigate the condition of the engine. Teh next thing I would do if everthing checkd out, would be to remove a freeze plug and check to see how rusted it is. true marine engines have brass freeze plugs so they won't rust. Automotive engines generally have steel ones that don't last too long as a boat engine. If it doesn't look too bad, remove the circulation pump and timing cover. Inspect them both for corrosion in the water jackets. What you are looking for is any signs that the engine is a rust bucket internally. If it all checks out, go ahead and pull the engine, carry it to a reputable maching shop, have them tear it alll down and give you an estimate to put it back right, or dispose of it as needed. Make your decison at that point. I used to do head cylinder head jobs on boat motors, but I had too many come back with other issues, the owners didn't understand that I wasn't a fortune teller, the head job held up fine, the rest of the motor didn't. If you motor is junk, check with PCM engines, and ebasicpower.com for a warantable replacement long block. FIguire replacing the manifolds and elbows as well. SOmewhere along in this discusion, some one is going to sugest replacing the I/O with an outboard and a bracket. Its worth discusiing if you are prepared to invest soem money into the boat
