"Open up!" you say. "Horatio sent me!" There is a pause. Then the door opens, revealing a pale-faced Lou. "Right, then...um, how can I help you?" he says, "Heh, he knows I wasn't hidin from him, right? Listen, I really shouldn't be talkin' to you, but I might be able to point you in the right direction." Abruptly, he picks up a nearby object that looks like a rock, but is big enough to conceal you, then hands it to you. "Take this to the back of the Jangolode Mine, southwest of here, then hide in it." Equally abruptly, he shuts the door in your face again.
Accept. Head off to the Jangolode Mine. Decline. This could be a trap. Besides, you might be better off taking a look around here instead.