I don't think that the water in the pipe was any problem. But the water in the wire may have been the cause.It is tough to tell after the burn out what was the actual cause, for me.

There was no corrosion of the conduit and minor damage to the ridged at the fault location. But the wire burnt clear through.

Is the wires insulation (THHN/THWN) tested for the conditions that I've described...with water on the inside of the wire in freezing temps?

shortcircuit