Abstract: The general concept of this invention is to utilize the high efficiency of heat transfer that is obtained by allowing the exhausting gas from the burner to come into intimate contact with the liquid to be heated. A housing adapted for partial immersion in the liquid of the tank and has an internal liquid heating chamber and defines inlet and outlet openings. A burner tube is supported within the housing and extends into the liquid and provides a combustion gas discharge opening. A burner assembly having a supply of combustible gas and air is in communication with the burner tube and has a burner nozzle being positioned to direct a flame into the burner tube. The burner tube has sufficient length for substantially complete combustion of a gas/air mixture within said burner tube and to discharge hot combustion gas into the liquid within said internal liquid heating chamber. The flame and hot combustion gas efficiently heat the liquid circulating through the chamber via the inlet and outlet openings.