Prey 2 developer Human Head hasn't worked on the game since February due to a contract dispute with publisher ZeniMax, according to an inside source.

Shack News' anonymous informant claims that the studio deliberately stopped development late last year while attempting to negotiate more favourable terms with Bethesda's parent company.

Many of the game's development staff were subsequently laid off, in the hope that they would be re-hired when the contract problems had been ironed out.

There was apparently some positive forward momentum until January at which point ZeniMax all but broke of communication with the studio.

The source added that there was then some additional progress in late February but things "soured" on 2nd March, from which point hence they can provide no additional first-hand information.

Immediately following Bethesda's announcement this morning that the game had been delayed, Eurogamer asked the publisher if Human Head is still working on the title. A spokesperson replied that it wasn't willing to comment further on the game at this time.

Its original statement claimed that Prey 2 has been pushed back because "development has not progressed satisfactorily this past year, and the game does not currently meet our quality standards."

"We have made a substantial investment in game development to deliver the experience fans want," it continued.

"We are determined only to release the AAA game that fans rightfully expect, and are unwilling to compromise our quality standards to meet a release schedule."

Last month Interscope founder Brian Fargo singled out ZeniMax in a rant about poor treatment of developers by publishers, specifically its decision not to pay Fallout: New Vegas studio Obsidian a bonus because the game received an 84 point Metacritic average rather than 85.