  We report the discovery of a small galaxy system in the vicinity of the
NeVIII absorber at z=0.20701 toward HE0226-4110. The galaxy system consists of
two 0.25 L* disk galaxies and a 0.05 L* galaxy all within \Delta v < 300 km/s
and rho< 200 h^{-1} physical kpc of the absorber. We consider various scenarios
for the origin of the NeVIII absorption, including photo-ionized gas from a
AGN, a starburst driven wind, a hot intragroup medium, hot gas in a galaxy
halo, and a conductive front produced by cool clouds moving at high speed
through a hot medium. We argue that the conductive front scenario is most
likely responsible for producing the NeVIII feature, because it is consistent
with the observed galactic environment around the absorber and because it
naturally explains the multi-phase nature of the gas and the kinematic
signatures of the absorption profiles. Although our preferred scenario suggests
that NeVIII may not be directly probing the warm-hot intergalactic medium, it
does imply the existence of an extended hot confining medium around a disk
galaxy that may contain a significant reservoir of baryons in the form of hot
gas.
