Edea's house and White SeeD Ship
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Items: Weapons Monthly, July issue; Timber Maniacs x2
You will wake up in the infirmary. What a nice way to start off the new chapter. Well, it's time to pay Edea a visit. Since you should know where the house is by now (southern Centra continent area), nothing should stand in your way! Unless you want to tackle a few sidequests first, of course. Visit Edea and talk to her. She will have a lot of new information for you! But nothing overly interesting, really. You'll find a Timber Maniacs in the Timber hotel if you spend the night; there will be a hidden draw point at the missile base and a few in Deling city, and a few free items in Dollet.
Return to the garden, if you want, pick up the very useful July issue of the Weapons Monthly in the training hall. You could kill a few T-Rexaurs while you're at it; they should have become pretty strong by now (corresponding to your party level) and, if you have Squall on low HP and pound them with your limit break on first strike, they will be nice and easy experience. Go back to the infirmary to pay Rinoa a visit- and another Laguna dream sequence will start...
Ladies and gentlemen, we present to you the....let's call it individual and unique acting of Laguna Loire! Oh noble sir Loire, how unfortunate that a real dragon is just about to toast thy behind. I've heard different opinions about the dragon mini game: Ridiculously easy for some people, it seems to drive others to the brink of insanity. There's a trick to it though. Wait until the dragon attacks to defend yourself. How do you know that it's not too late? This may be very hard to notice, but a split second before the attack, he will make a little hop, because the animation loop will break and the attack animation will start. In this exact moment, defend yourself and the dragon will do you no harm. Attack him right after he attacked you, then wait until he's about to attack you again, repeat. This way the dragon should be no problem.
As soon as you can control Laguna again, leave the scene to the left, save, junction your GFs, heal and so on and so forth; because what's coming up will not be a piece of cake. The dragon, refreshed and recovered, is rather pissed and you will have to fight him. Now, I have good news and bad news for you. The good news is, ruby dragons have obvious weaknesses and will reward you with tons of experience points and valuable items. The bad news is, you might not live to see that. Ruby dragons have a ton of HP, and they show no mercy with their attacks. Watch out for his oh so destructive breath attack. And meteor. And everything else he does. Use Shiva, ice- and holy based attacks and Laguna's limit break if you dare and pound this thing silly until he finally dies. Don't use fire- or air elemental spells or you will heal him. Once you kicked him well, Laguna will meet Edea and the dream sequence breaks...
...and Squall will wake up next to Rinoa's bed once more. Travel to Edea's house and get her hint on where the ship of the White SeeDs is- you will not find it unless you talk to her first, trust me. Painful experience. Also check her house for a hidden draw point and a Timber Maniacs magazine. Edea will hand you a letter which she will write anew in case you accidently sell or trash it, and since she will give you an infinite amount of letters you COULD use it to make some profit. However what you gain for selling it once is really not worth the trouble; any of your SeeD- salaries will be higher than this. So whatever.
This is a perfect time for sidequests now. I advise you to pay a visit to the Shumi Tribe, and check out Winhill before you go on. You'll find some more instructions in the sidequests section. In case you want to visit some of the old places as well; not much will have changed in the meantime.
Either way, sail around, around and around until you find the ship to the east of Edea's house. Board the ship, and people will be a little hostile at first, but eh. If you still have Irvine's porno- magazine, you can trade it for a Shiva Triple Triad card if you talk to Zone, who will be waiting upstairs. Walk around until you find Watts (remember the guy from the Forest Owls?) and talk to him, and people will be a bit more friendly. Eventually. Pick up a the Timber Maniacs on the bridge and talk to Thon. There's a hidden Holy- draw point in the main cabin, so empty it, then talk to the leader. He will examine Edea's letter and tell you that Ellone left already- and is most likely on her way to Esthar. You'll find yourself back at the garden bridge, so have a look at Rinoa. Squall, now completely out of his mind, will take her outside (he can't get to Esthar fast enough it seems!) where the others will be waiting. Form a new group (Edea will just stay in you party for a certain amount of time, so take all the magic she has. She can be useful, but if you want to focus on levelling up you should train your other characters). And off we go, to new horizons, on our search for Esthar.