The Energy Core is a key item.
The Energy Core was the power source for the ancient monster Aegis. When Horace's evil twin used the Diamond Eyes to revive Aegis, the Hero destroyed it. The Energy Core remained, however, and was on the verge of exploding. Horace had Tiny throw the core away to save the city. The Energy Core impacted north of Horace's Camp, opening a massive hole at the base of the waterfall. The hole led into the Oglin Caves and diverted the river, drying up the area.
The Energy Core was not destroyed in the explosion, however, and ended up buried beneath the Chessboard. The hero found it on his way below the Chessboard into the Dark Forest, and noted the core was still giving off energy.