STS035-076-070 Blue Mud Bay, Northern Territory, Australia December 1990 Located along the western edge of the Gulf of Carpentaria, Blue Mud Bay (right middle) is one of the larger embayments along the east coast of the Northern Territory. Bickerton Island is the irregular-shaped island in the image. Large tides wash over the coastal mud flats (gray areas along the coast) and produce muddy sediment plumes along the shoreline of the bay.