Special location in PoP
The only way to be able to discover Hidden Mines is by talking to Brother Randalf and getting the map in exchange for 1 qualis gem. He can be found in taverns randomly travelling between various locations. Once you unlock the mines you can enter and leave as often as you like, you don't need a gem to enter each time.
After there is a message displayed telling you now know the location of hidden mines you can find it on the map.
The mines are found east from the Valorshield Castle, on the lands belonging to the Jatu and Noldor spawns, which is a borderland between Poinsbruk and Laria, or south of Torbah in the desert, it's different for everyone.
For the older versions the mines were concealed and only appeared if you were close enough to their exact location.
The location itself is pretty simple (2 merchants, a building, horse), to obtain a weapon of your choice you must have 1 qualis gem and by selecting appropriate dialog options you will receive rune version of your weapon, however to be able to further upgrade this weapon you need another qualis gem and wine. After you acquire your rune weapon talk to the hermit and he will take your wine then you will be given the possibility to create Ruby, Saphire or Emerald Rune weapon (It's worth noting that you must talk to him twice; once to give him the wine and the second to access any of the three upgrades, indicated by the "I'll just....take a look").
Ruby weapons have high damage stats and have the very important property of converting damage types to piercing; a Ruby Rune Two-Handed Sword, for instance, will deal 75 piercing damage instead of 75 cutting damage, making it even more damaging against all types of armor, especially plate armor.
Sapphire weapons have very high speed ratings, ranging from anywhere from 100-140, along with a slight increase in damage. In the case of bows, in addition to increasing damage and speed (faster bow string draw) it also gains more accuracy (95 accuracy in comparison to a Ruby Rune Bow's 88 accuracy).
Emerald weapons strike a balance between the two, offering slight increases in both damage and speed (but not to extreme degrees like Ruby weapons would with damage, or Sapphire weapons with speed)
You might get stuck inside the location, this means your tab button won't allow you to leave the place, to leave walk to the edge of the map and use F to leave (Although as per the more recent versions this no longer holds true and you can now exit by simply hitting tab, as with other locations).