If you want to kill Arhu (which is a valid solution to the quest), you can just Ctrl+Click on him to initiate combat, like with everyone else.
If you don't want to kill him, there's obviously another solution, but Arhu doesn't know anything about it. A dialogue option for "Hey, this crazy lich woman wants to kill you" would be nice, but you can finish the quest without ever talking to Arhu. Just keep exploring the area.
