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Located in a box canyon, the Horseshoe Temple Oasis was known to have an ample supply of fresh water that bubbled up from underground. This underground water supply allowed the oasis to never dry out, even under periods of extreme heat.
The bottom of the oasis was covered in grasses, flowers, and streams, and, near the cliff side of the canyon, were pine trees planted there hundreds of years ago by the priests who had carved the many caves in the cliff side.
The most prominent feature of the oasis was these caves. Over thirty caves, carved at various heights along the cliff-face, formed a large holy site. Inside one of these caves was the item the oasis got its name from, a large block of sandstone, with an impression of a horseshoe in it.
According to legend, it was at this spot that the Heavenly Sage, Hung Te Ping, stopped to rest during his travels between Shou Lung and the Celestial Bureaucracy. During this stop, the sage's horse was said to have struck his hoof in the rock, leaving the impression that remained for centuries after. Many followers of The Way believed this to be a holy site.
While by far the most important, there were other caves of note in this complex, including the Grottos of the Nine Sages, each of which was dedicated to one of the great sages of Shou Lung legend. There was also the Halls of Life and Death, which contained the costumes and masks needed to perform the Dances of the Seasons, and the Chambers of the Emperor Kao, built in honor of the great emperor, and filled with valuable treasures left there by various emperors of Shou Lung's dynasties.
While normally inhabited by monks, as of 1359 DR, the temple had fallen under the control of evil oni, led by Halbasho the Smart, who slew the priests and made the location their home. The oni systematically defaced the shrines and destroyed the treasures in the cavern complex, converting it to a temple to Li Pei, Lord of the Underworld.
The oni were served by goblins, who had settled in the far end of the canyon, and had slowly been learning the teachings of the priests who lived there. They served the oni with reluctance, viewing the oni as punishment for the sins of goblin-kind.