You now must travel to Echo Cave to face Mannimarco, the King of Worms.
Search his corpse and remove the Filled Colossal Black Soul Gem from his inventory. A short chat will ensure, and then the Arch-Mage will sacrifice himself. The Elder Scrolls IV: Oblivion Guide - Mages Guild 18: Confront the KingĪfter completing 'Ambush' and having given the Colossal Black Soul Gem to Traven, speak to him and select the 'Tasks' dialogue option.