I didn't find an answer, and came to the conclusion that it was a sort of Easter Egg, a bit like that buoy in the water just off the northern end of New Sorpigal mainland in MM6. If you click on that, you get a multicoloured eruption from the volcano on the island beyond the buoy.
I'd be delighted to be proved wrong, of course!
I didn't enjoy MM7 as much as I'd enjoyed MM6. The impossibility of having a party with access to both Light and Dark magics really put me off the game, despite its obvious virtues.