Sheathbill Bay is a small bay just north of Rosita Harbor (the features being separated by a small cove) along the north coast of South Georgia. So named by United Kingdom Antarctic Place-Names Committee (UK-APC) because the bay is frequented by sheathbills (Chionis alba).
This article incorporates public domain material from the United States Geological Survey document "Sheathbill Bay" (content from the Geographic Names Information System).
References
Sheathbill Bay Wikipedia(Text) CC BY-SA