The Wrought iron key is a reward from the Tourist Trap quest. It opens a door deep inside the Desert mining camp and allows passage to a special mining area inside. If you lose it, it can be replaced by searching the desk of the captain inside the Desert Mining Camp.
This key allows access to the north western most tunnel (after riding the cart underground) that has several higher rocks for mining including Adamantite ore and Mithril ore bearing rocks.
This key can be placed on the Steel key ring.