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Hello, sorry for the dumb question but I keep trying to find "Diabosite" that you need to build the prison but I legit can't find it anywhere :( could someone help?

(+3)

If I remember correctly, you have to complete the "Rat Problem" and "Rats!" quests for Harold/the Bareshade tavernkeeper, which will unlock the tavern's basement for you. 

After that, you have to keep exploring the area close to the entrance until you unlock the mine. It's a random event though, so you gotta keep trying

Hope this helps!

omg theres more on the entrance?! I'd never think to try again there! Thank you so much