Munin said you would need a special weapon to beat Hellion. he told you to meet Skuld, who had the designs for a weapon called the Spirit Blade. You collected the materials required and took them to Baoninerk as Skuld instructed. The weapon was then made for you. You took the completed Spirit Blade to Munin, who said there were still many things to do before your battle. He offered to keep hold of the sword until you were ready to properly wield it.