According to the article, Hines confirmed that Human Head Studios, the developers behind the original Prey, are still behind the reins of the sequel. He also confirmed that the the sequel is still on the table and has not been cancelled, despite the persistent whispers.
“Yes, we could ship it and put it in a box and be done with it, but it won’t meet anybody’s expectations,” Hines told RPS.
Prey, a first-person shooter that takes place on an alien spaceship known as the Sphere, was first published in 2006 by 2K Games. The developers announced in 2011 that they would be working with Bethesda to make a sequel.
Source: Rock, Paper, Shotgun