Passat sport Engine oil has water in it !!!?

Gents,

Today I checked my engine only to find what looked like water mixed with oil, resulting in a thick grey mix inside engine and level well above where it should be. I investigated and found lots of water around the battery area, I investigated and found the cause to be blocked drain holes, these have now been cleared. Could this we how the water has got into the engine or is this something more serious ?? What do I do next ??

Appreciate your help.

John