1996-1999 OBs used Subaru's most fragile motor, the dastardly first gen DOHC 2.5i. ALL
of these motors suffered from head gaskets that rupture internally, allowing exhaust
gases to over-pressurize the coolant, resulting in what's referred to as "percolation".
You're seeing it in the expansion tank, but what's happening in the pressurized coolant
bath is much more violent. These blocks were fairly fragile, too, and didn't suffer
expensive head and gasket repair too successfully, often blowing rods within a few
months later. So THROW IT AWAY and start over again with a more modern iteration.
Rarely someone will try to retrofit a smaller, simpler 2.2i in there, but the loss of power
and acceleration is palpably unsatisfying. So even if you find a "clean" pre-owned salvage
motor with dry heads, the odds are very high that it's either percolating already, or will
soon do so! (Note that this scenario is DIFFERENT from the atmospheric leaks endemic
with the 2nd gen 2000-2009 2.5i, wherein the new triple-ply HGs WILL successfully allow
long term use. Note also that these concerns disappeared after 2010.)
So do NOT spend money on t-stats, fans, radiators, etc., as ya can't stop the erupting
volcano deep inside the HGs. Sorry. Best, Ern TSG/B