Their talking about the big evil looking glowing ball with tentacles outside the mine entrance in Broken Valley. Each time you read the book near it some black ring guys attack. After you kill 3 waves a demon attacks. When the demon dies the hell gate blows up and you get some decent loot along with a demon claw if you didn't get it from bellegar's demon. I recently beat with my ranger character and got a +6 melee damage charm.
