You used Solberg’s Crystal Key to get into the area of the center of the tower where you fought some demons, right? There should be a chest there with the Blessed Athame, which you need, in it. There should also be a spiral stairway past the barrier that takes you to the upper flour where you fight the demon.

This site is really helpful, but to the point where there will be no surprises, it guides you through the quests with screenshots:

https://lparchive.org/Avernum-Escape-from-the-Pit/

If that’s too spoilery for you then I’m happy to keep helping you.