First, you need to obtain a Jade Reaver from the City of Mist. To do this you need several strong groups which includes a Rogue with Lockpick skill of 200 or more to open the locked doors of the castle at the back of the zone. Then you need to kill Black Reavers, who will eventually drop the Jade Reaver. You then need to go to North Kaladim and find Kinlo Strongarm downstairs in Everhot Forge at 356.06, -189.21, 1.75. He does not respond when hailed. You need to be at least indifferent to do this part of the quest. I was apprehensive and he would not speak to me, but using sneak did the trick.
You say, 'what mud?'
Kinlo Strongarm says 'Eh? Oh, the clay. Arrr. Lots o' that mud round 'ere. Mostly, a good dwarf not be needin' somethin' so soft 'n squishy but the womenfolk, you know, the elves come lookin' fer it. If ye be one o' those pansy elves wantin' some mud fer workin' into fairy statues, flashy trinkets, 'n pig sticker arrers then I can get it for ye. Course I'd be lowerin' meself, a good dwarf, ta be diggin' that kinda mush outta the ground, but I can do it fer ya.'
You say, 'do it for me'
Kinlo Strongarm says 'Arrr. Shaddap. I ain't doin' it til ya bring me somethin'. A fee, I guess ye'd call it, fer lowerin' meself ta elf woman work. Go get me a good strong axe and I'll do it fer ye. Mebbe somethin' with a good tinted polish on it. I got plenty o' axes but no tinted ones. Har har! Colored axe. Somethin' to go with the color left on the blade after I be crackin open a gobbo head.'
Now give him the Jade Reaver for the following response:
Kinlo Strongarm says 'Arrrrr. Ooooo. Arrrrrr... Yah, now that's what I be callin' a good lookin' axe. I be crackin' a few skulls with this one. Oh, here's yer block o' mud. Our priests o' Brell use the mud pit fer relievin' themselves after really hard ale blessin' ceremonies, so ya ain't got ta be enchantin' it in holy water or anythin' cause they already have. Har har!'
He gives you Enchanted Clay .
Continue to phase 6 of this quest.