Now we've reached beyond Midgar and a game you would have though was almost over and that you must be finished with Disc 1 by now, here in the open world you realize that the game has barely even begun. Now you have a world map, an incredible overworld theme, and new places to go. Unfortunately unlike what you might think, FF7 is still linear as fuck the whole way through it. We might be in the open world, but the only place we can go for now is Kalm just to the Northeast of Midgar.
Kalm is the first place that really presents itself like a traditional fantasy type of town. The buildings are old European wood, there is no real sign of technology here, the best word to describe it is "quaint". For the player the only thing to do in town besides rob people is to visit the inn where the party will ask Cloud to explain what the fuck is going on and who the hell is Sephiroth. Here he describes the Nibelheim flashback which really does a lot of things to lead the player on. Sephiroth is revealed to be insanely strong, hitting for numbers you can only dream of up to this point, and casting insane levels of magic. No matter what random battle you encounter Sephiroth wins in 1 hit, with the exception of the dragon during the intro of this story.
Cloud tells the story of how he and Sephiroth were sent to his hometown of Nibelheim to investigate a reactor that Shrina had left up in the mountains. The town had been complaining of monsters attacking the village and Shrina needed to make sure that if the monsters were the reactor's fault, then the two SOLDIERS could deal with it.
In retrospect this mission is incredibly stupid on Shrina's part. You have to assume that the higher ups in charge of SOLDIER, the reactors, and Hojo himself, would be aware of what they left behind in Nibelheim, and if those things were found by Sephiroth of all people, it would be a big fucking problem. When I think about Shrina, it really is quite amazing how absolutely stupidly incompetent they actually are. They have very little protections in place for literally any of their facilities, reactors, hell their fucking headquarters was barely guarded. And here in the nibelheim reactor they abandoned, they literally left Jenova there for fucking years, alone, unguarded, and then when they finally send people to check up on it, one of those people is Sephiroth!? That's the dumbest shit, they should have done everything in their power to keep Sephiroth as far away from Nibelheim as possible, forever.
But that doesn't happen, Cloud and Sephiroth make it to the reactor where Sephiroth realizes he's not what he thinks he is and goes a little looney about it. After killing everyone in the Sephiroth goes to steal Jenova away only to be confronted by Cloud. However Cloud cannot tell the party how he fought or beat Sephiroth in that moment as he can remember nothing beyond that.
The party is confused but at least they have some idea about who they're after. As the party leaves the Inn, Tifa hangs back lost in a questionable thought....
Back in the overworld you have only one path to follow which wraps around the nearby mountains to a farm and beyond the farm is a swamp with a big scary snake shadow in it. If you step onto the swamp water the snake attacks you and you will die unless you are a grinding god. I grinded once and beat the Zolam snake this early into the game once, it was cool. The snake just respawns though so....pointless.
Doubling back to the chocobo farm the kid Billy inside the stables will give you a materia that causes chocobos to appear where ever tracks exist on the world map. In order to catch a chocobo you have to kill all the other enemies in battle without hurting the bird. He also sells greens that when used in battle distract the chocobo so that it wont run away as easily in battle.
Once you have a bird, run across the swamp to encounter a dead Zolam impaled on a broken tree. Only Sephiroth could have done this.
Past the dead Zolam is the Mithril Mines a very small zone with a couple of items and the first extremely good grinding spot. Enemy groups appear in 4-6 and using a summon will basically wipe them out completely. This will very quickly allow you to get all the limit break levels for every character and the exp is fantastic as well especially since the battles require zero effort. You can absolutely reach the high 30's here and go kill the zolam in a couple hours no problem.
Otherwise the party encounters the turks here, for the first time meeting Elena the girl and Tseng the leader. They inform the party that they aren't currently after nor concerned with Cloud and the others and simply tell the group to stay out of the way and everything will be fine.
Once outside the mines you are in the next segment of the world which has three locations available to visit. One is a sleeping man in a cave who you can reach until you come back with the buggy, the other is Fort Condor which is a tower defense which is an absolutely worthless mini game throughout the entire game. We have to come to Fort Condor in disc 2 to play the mini game once, but outside of that there is literally nothing on offer here. The final location is Junon which is a Shrina costal town fortified with a giant fuck-off cannon.
Before headed to Junon you can mess around in the forest areas around here and meet Yuffie, who will join your party if you can defeat her and answer her question puzzle correctly afterward. She is a second long range character that will help with the next boss fight.
Junon much like Midgar has a poverty ridden town under the modern and rich city above, upon entering the town you are told to go see the dolphin at the beach where you'll meet a little girl training a dolphin. She doesn't trust you and thinks your Shrina so she demands you leave her alone, only for a flying fish monster to show up and attack the Dolphin. She runs to help and we run in to save them both. This boss is called BottomSwell and he is a mix of Aps from the sewer under Corneo's place and the Reno right during the sector 7 plate collapse. Bottomswell with hit everyone including himself with waves of water, which wont hurt him nearly as much as they hurt you, and he will also put your party members into bubbles. Unlike Reno these bubbles will rapidly tick your HP down and can only be hurt with magic. This fight is fairly easy regardless depending on if you grinded in the mines at all, however it's a nice example of the game taking mechanics it's already told you about and combining them plus making them more dangerous. It's a very natural increase in difficulty despite it being easily overpowered if you took any leveling up time. Also if you have Yuffie, Barret, and Cloud (equiped with a long range materia from the Mines) you can have a full team that can actively attack the boss. Since it flies, normal melee characters will not be able to hit him without magic adding another level of complexity to the fight.
Regardless once you beat the boss the girl is drowned and Cloud needs to do CPR on her. You press a button to hold your breath, and press it again to breathe into the girl. You cannot possible fail this mini game, if you give her nothing but baby breaths it just takes like 15 of them to wake her up but you will wake her regardless eventually.
The girls family gets you a hotel room out of thanks and in the morning she gives you another summon and offers you a way into the city above via the dolphin. Cloud is the player character so he is the only one who can jump on the Dolphin so up you go. The rest of the crew will appear up in the city magically anyway. Once Cloud makes it up to the city he is mistaken for a Shrina grunt and is immediately forced into uniform and into Rufus's parade march. This is another mini game where you must fall into time with the march and raise your gun in time with the rest of the group. People announcing the parade on TV will call you out for sucking at this because you will suck at this and will probably send you a bomb. If you manage to do well somehow, they can send you a materia, but it's not worth caring about.
After the parade you are given some free time and then told to go to the Shrina ship docked at the harbor for Rufus's sendoff ceremony. This is a mini game that's just a quick time event, push the buttons as they appear and win. Depending on how you do Rufus will give you a prize and then you run onto the ship where your party is already waiting for you for some reason. This whole section feels like it was glossed over but there really is no story here at all. Cloud never tells the party any of this, yet the party magically knows to sneak onto the ship. It's never explained how they knew about the boat, nor how they got into the city in the first place. They all even disguised themselves. Okay whatever.
Small thing to note, there are a couple bars you can visit in Junon, one of which is a bar that only serves bald people where you can find Rude hanging out, and another more traditional bar where you can find Elena drinking her sorrows away. Both of these are in Rebirth as well.