it looks like an apt cause your water heater is on the ground and not elevated to 18 in so its not a garage either.

When you burn natural gas , propane, or other gases for heat burns oxygen and turns it in to Co2 that water heater will help you more than it will hurt. i live by myself so the water heater only kicks on when i use hot water so it fills my G.R. with co2 two or three times a day. I only have to worry about heat and its being a prob in the summer in the winter it keeps my GR warm. you dont have to worry to much about a explosion your pilot is in a contained area just make sure it gets adequet oxygen which it should since its a utility room or it wil burn co2 and leave co (carbon monoxide which will kill your plants).

I knocked my exhaust off so it fills my room and since my exhuast is in the roof the heat rises and goes out new air comes through the vent holes in my utility room door and the large gap underneath. a fan circulates the air b4 it leaves and i took a co2 reading once since it cost me ten dollars but i was at 500ppm approx. since the fresh air that comes in is cooler, it is what feeds the heater which is on the ground heat rises. thats alot of writing any ?s just ask. thats my 2 cents . oh btw i now flower in that room and my veg gets no co2 enrichment and you can really see the differance.