Find a living Far Seas trader in there. This is Pella Saltbreeze at ( 71, 129, -264 ) /waypoint 71, 129, -264. She's surrounded by a group of pirates; as you approach she kills them all. Unfortunately, to get to her you will have to kill several of the nameds as you walk directly past them. She is located on the very top area of the zone which means walking right past Captain Bilgewater. Luckily even if you kill all the nameds first, the quest will still update.
For this, kill Captain Berlon Bilgewater at ( 113, 145, -362 ) /waypoint 112.86, 145.12, -362.You'll have to clear the other four named in the zone to spawn him. The solo version of Captain Bilgewater only summons a skeletal add occasionally. Once he's dead, loot a Magical Treasure Chest Key from his body.
NOTE: It is possible to loot the key before you can use it, but the treasure chest will not sparkle until your quest is on the correct step.
Return to the forge room ( -29, 121, -243 ) /waypoint -29, 121, -243 , and use the key on the sparkling treasure chest. It will teleport you into a hidden treasure cove. Click on the vase to receive Ancient Arcane Artifact. Note: the forge room is at the very top right where you stepped out onto the top of the falls.
Investigate the artifact (examine it from your inventory)