Gabe Newell has confirmed what we all suspected: that Valve is working on a new game engine, undoubtedly Source 2.

When members of 4chan popped over to Valve's office to deliver Newell's 50th birthday present they also asked him some questions. The most pertinent was this:

Is Valve potentially already working on a new engine? Source 2? Could or… could not be?

Newell replied: We've been working on Valve's new engine stuff for a while, we're probably just waiting for a game to roll it out with.

Then, Is it going to be more than just an extension to Source? Is it an entirely new engine?

Newell: Yeah!

This isn't the first time we've heard mention of Valve's next game engine. In August files found within Valve's Source Filmmaker program referenced a next-gen engine from the company, referred to as Source 2.

The numerous lines of code that referenced Source 2 suggested the new engine was in development and primed for inclusion within Filmmaker at a later date. The original Source engine originally debuted with Counter-Strike: Source and Half-Life 2 in 2004.

So, what's this game Valve is waiting to roll Source 2 out with? Is it Half-Life 3? Elsewhere in the 4chan chat, videoed below, Newell confirms Ricochet 2, which Valve has often jokingly referred to when press and fans ask about Half-Life 3, is in the works.

Meanwhile, Newell reveals SOB, the abbreviation for a game some believed to be in the works at the company, refers to Stars of Blood, an internal project that was never released.

We're not doing it any more, Newell says. We had an internal project called Stars of Blood, which was a space pirate game, and that never saw the light of day.