Nelly Bay is a town on Magnetic Island and a suburb of the City of Townsville, Queensland, Australia.

[7][8] In February 1984, Bob Katter Jr., the then new Minister for Northern Development, announced the $100 million development of a harbour and marina precinct in Nelly Bay proposed by Geoff Orpin, a former Maroochy Shire Councillor who moved to Magnetic Island in 1980.

At the time, the project was to be called Magnetic Keys, and Katter insisted all environmental concerns would be addressed with construction beginning within six months.

However, it was another 18 months before the developer was even able to obtain the correct permission and leases to perform feasibility and environmental impact studies in the bay.

[citation needed] The following year saw a number of court cases and tribunals held in opposition to the project, but none of these halted construction.

It was later alleged that the developer made an unrecorded donation to Townsville Mayor Tony Mooney's election campaign.

Further improprieties were suggested between Townsville City Council employees and one of the judges overseeing a case appealing the development.

However, work continued to accelerate until July 1990, when the dredge being used on the project sank, followed shortly by the collapse of the Magnetic Keys Consortium.

[19] The Townsville City Council operate a mobile library service which visits the Lions Park at Nelly Bay on Tuesday, but its opening hours may be affected by the tide times.