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Valve Confirms New Engine?

LambdaGeneration has word on Valve's software engineering efforts based on a video of a visit to Valve by some members of 4chan's /v/ (thanks Joao). This seems to offer the first concrete word on hints that they are working on a new game engine. Here's their transcript of the pertinent passage:

Fan: Is Valve potentially already working on a new engine?

Fan: Source 2? Could or… could not be?


Gabe Newell: We’ve been working on Valve’s new engine stuff for a while, we’re probably just [incomprehensible, subtitled as: "waiting for a game to roll it out with"]

Fan: Is it going to be more than just an extension to Source? Is it an entirely new engine?

Gabe Newell: Yeah!

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37. Re: Valve Confirms New Engine? Nov 12, 2012, 15:16 PHJF
 
Yep, I ran L4D2 on a Pentium 4 2.8Ghz and ATI x1600 for a little while and it was more than playable. Source seems to be the only modern engine that doesn't look like complete shit when you turn down the eye candy.

But it never looked great on the high end, either. Low poly counts, textures, lighting, animations (except facial) were never top-of-the-line in any Source title. At least Source made a big push for FSAA, though. It *felt* right when playing a Source game, anyways. No floaty movement, (usually) sensible physics, etc.
 
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Steam + PSN: PHJF
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