Lake Macquarie council's proposed extension of the Fernleigh Track looks set to proceed after the NSW government announced funding for the project.
The 3.5-kilometre shared pathway, first proposed by the council in 2018, is considered a vital missing link in the city's and region's cycling infrastructure.
It will run from the Belmont end of the Fernleigh Track to an existing shared pathway at Blacksmiths, creating a 27-kilometre continuous cycleway from Murrays Beach to Adamstown.
Liberal MLC Taylor Martin said the $7.4 million project would boost tourism, provide better access to existing attractions and promote health and fitness.
"When complete, this section of shared pathway will link with existing pathways to create a 27-kilometre route of continuous cycle track from Murrays Beach to Adamstown, creating an exciting new trail," he said.
"This infrastructure will open up opportunities for cycling and walking, trail running and community events, creating new and repeat businesses such as cafes, restaurants and adventure-tourism companies."
The multi-million dollar grant comes from the $300 million Regional Growth - Environmental and Tourism Fund, set up to deliver infrastructure projects that improve the economic growth of the state, Mr Martin said.
The Fernleigh Awabakal Shared Pathway, as the project has been titled, includes an accessible elevated boardwalk past Belmont Wetlands that will feature local indigenous art.
The council endorsed the purchase of a parcel of land from TAFE late last year to allow the project to proceed.
The exact route of the path is still be confirmed. A map featured in council papers last year showed a potential route running along Ocean Park Road, Green Street, Arthur Street and Hudson Street before running parallel to the Pacific Highway.
Lake Macquarie council's deputy chief executive officer Tony Farrell said that route was considered a concept and a more detailed design would now be prepared.
He said driveway locations, existing services and planned upgrades to Hunter Water infrastructure would need to be considered.
Mr Farrell said the path did not require Belmont Golf Club land, but council was working with the club to confirm its future plans in order to "get the cycleway in the best location".
The path will likely be staged due to the need to prepare environmental studies for part of the project. A regional planning panel will determine the final proposal.
"Some of those southern sections, we'd be hopeful to have them underway in 12 months," he said. "But those more complex sections, probably about 18 months."
Lake Macquarie mayor Kay Fraser predicted the "missing link" pathway would prove popular with both locals and tourists.
"It will showcase our city, generate active leisure tourism and help promote healthy lifestyles in the local community," she said.
North ward councillor Kevin Baker said it would "bring more tourists to the city - building our local economy, supporting businesses, and creating more jobs".
"Importantly, this pathway will also feature eight Aboriginal public art installations that will celebrate our local Aboriginal culture and connection to the land," he said.