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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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