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2000 Jaguar S-Type, V-8, 4.0 Engine. Mystery to solve-Sits in driveway.Add water

(2000 Jaguar S-Type)
in Lawrenceville, GA on May 25, 2013
Add a Gallon of water, overnight it leaks out slowly but cannot see any evidence in driveway of leakage. When started water blows out exhaust, but otherwise runs smooth. Inside valve cover near breather, sign of water-yellow top of cover only. But otherwise does not seem to mix with other oil in valve area. No sign of water in oil pan on dip-stick. What do you think is happening?
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