My first choice would be a Yanmar diesel but that might push the window on cost.
My second choice would be an Indmar, Volvo or Marine Power 6.0L with FWC; not for the 370-380HP at WOT but for the low end torque and great efficiency at cruise. That is the Gen IV small block used in lots of trucks and tow boats. The IB won't really be able to use the high end power because the pocket will keep it from getting to high speed but the engine will really be loafing at cruise and it wouldn't surprise me to see over 4mpg at cruise. The Gen V marine 6.2 just came out from GM but it is 420HP and pretty pricey for a gas motor.
Merc has a 6.2L that I heard is nice now that it just had some mods implemented (early 320HP ones had issues w cooling); it now has a 300 and a 350HP model but it is not a GM block and I'm not sure about the part prices.
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