Orb

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•  Bone Shrapnel Grenades
•  Demon-fire Orbs leave a fiery patch dealing continous damage on impact or detonation.
  This increases to a larger area when used in conjunction with Grease Orbs. When used with Gaseous Orbs it creates a small explosion instead of a fiery patch.
•  Gaseous Orbs trigger a cloud of poisonous gases, continually dealing damage.
  Using fire orbs or explosive arrows triggers a local detonation.
•  Grease Orbs are used to place a slick of oil surfaces, which can be ignited it to set everything ablaze which lasts longer.
  Be careful, because these patches are slippery which is useful to prevent climbers on the walls and trip your enemies.
•  Water Orbs are used to put out fires from a distance.
  You can even use them to put out enemy torches and campfires so you can sneak through. Apart from that it is the only Orb that does not need an Alchemist as a prerequisite, and is used in production of any other Orb. Using it with a Gaseous Orb creates the same effect as when throwing a Grease Orb.

Source

In order to make them, you need an Alchemist Thrall at a  Firebowl Cauldron or  Improved Firebowl Cauldron.

Since the new patch, you need an Alchemist Thrall at a Alchemist's Bench, Trade Alchemist's Bench, or Precision Alchemist's Bench.

Usage

Orbs can be used in two ways:

• Using it with the light attack button lets the orb bounce several times until it reaches a surface after few bounces, where it sticks and triggers in a delayed explosion.
• Using it with the heavy attack button lets the orb explode on impact. This can be crucial in using combination effects, which can be hampered by changing the arc of the projectile.