Sorry for the late reply, didn´t stop by for a long time! The spout is for a relocated washer bottle - it´s normally located in the fender, where the snorkel goes through. I bought a "soft" washer bottle with an integrated pump from a Lada Niva.
Great build on your XJ! Did you replace the tranny and transfer case with the AW4 and 242?
I would highly recommend adding a Trans cooler for your AW4. I used a stock Wagoneer Trans cooler from a 360 V8. I had to shave down the inside of the grill just slightly to mount it in front of the condenser, but it worked great!