The oxidised kiteshield is a quest item used in the Dealing with Scabaras quest. It can be made by using a bucket of Ugthanki dung on a bronze kiteshield while standing in the Kharidian Desert.
It cannot be made again after the quest with attempting to do so resulting a chat box message stating "There's no point in distressing any more items. Simon has had his delivery of bronze artefacts.".
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