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The water is most likely coming from the temperature and pressure safety relief valve. If there is something to prevent water leaving the heater while it is heating, the expanding water will force water out the relief valve, instead of hydraulically breaking the tank. Once opened, some dirt can settle in the seat making the leak steady. Flushing the seat by lifting the handle may clear it to be able to stop leaking; if not you might have to replace the valve and add an expansion tank to the tank piping.