  In a multiwavelength program dedicated to identifying optical counterparts of
faint persistent X-ray sources in the Galactic Bulge, we find an accurate X-ray
position of SAX J1712.6-3739 through Chandra observations, and discover its
faint optical counterpart using our data from EFOSC2 on the ESO 3.6m telescope.
We find this source to be a highly extincted neutron star LMXB with blue
optical colours. We serendipitously discover a relatively bright and large bow
shock shaped nebula in our deep narrowband H alpha imaging, most likely
associated with the X-ray binary. A nebula like this has never been observed
before in association with a LMXB, and as such provides a unique laboratory to
study the energetics of accretion and jets. We put forward different models to
explain the possible ways the LMXB may form this nebulosity, and outline how
they can be confirmed observationally.
