The cloaked figure is a chaos dwarf that commits suicide next to the secondary boiler in the Lava-flow mine in Keldagrim during the opening scene of King of the Dwarves. The explosion causes the entire mine to cave in, killing two dwarven miners and injuring four others. Players must deal with the effects of the dwarf's actions during the quest by mining away rubble to free the dwarves.
The figure's actions sparked a small revolt in the city of Keldagrim and eventually forced the Mining Consortium to step down from power, and give way to a new dwarf king. Hreidmar, the director of the Red Axe Mining company and main antagonist in the Rise of the Red Axe quest series, is the descendant of the last king, though it was he who orchestrated the attack in the first place and who threatened the city with an army of chaos dwarves led by Colonel Grimsson. Because of this, Meike changes the records so Veldaban becomes king at the end of the quest.
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