Nester's Dagger is obtained from an Ankheg found north of Tenya's house at Wyrm's Crossing. It looks just like a normal Dagger and can be wielded as such, but it is a quest item and can easily be found long before it is needed. It is part of a side quest in the city of Baldur's Gate that can only be accessed during Chapter Five or later. There is no hint of its future usefulness apart from it being a named item.
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