valdane is held in the naga temple in the forbidding lands

Valdane is at the naga temple as said, you will not find Ellowyn there...infact, I havn't
gone far enough into the game to find her...Also when you're in the naga temple in the
Forbidden lands (Bellow Skuldoon) you may want to explore more, there is a relic of power
there. (To get to the Forbidden Lands you must agree to help Varguth (or whatever the
Skuldoon leader's name is))