Head on down the slope and toward the search area. You need an at level (for the area) Fire Weapon to ignite the Varkids. if you do not have one or are very overleveled for the area, head to one of the Incinerators found in Varkid Ranch. Run around the mounds and attract a number of Varkids to you. Once you have, run to the base of the incinerator and hit the button. This will set all the varkids on fire.