There could be a number of reasons he had water in gas but I don't think mid grade has anything to do with it . The difference between grades is octane rating . Ethanol gas will draw water from air especially if it sits up . A vent in wrong position will let water in . Gas sitting for 6-8 months will break down also . I run non ethanol and still use sta-bil marine and never have a problem . Then again it is possible the place he bought the gas had water in the tank....
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