Kingdoms of Amalur 2 was in the works

Kingdoms of Amalur: Reckoning 2 was already in pre-production prior to the closure of 38 Studios, developer Big Huge Games has revealed.

Better graphics, no loading, expanded and improved combat animations, fewer branching quests and greater effect on the world by players were all elements being tested for this sequel, anonymous tipsters close to the canceled project told Joystiq.

Despite selling 1.2 million copies in under 90 days, EA passed on the sequel, though Big Huge Games did shop it around.

It's unlikely Reckoning 2 will ever surface. The intellectual property, tech and code are still owned by Big Huge Games' parent company, 38 Studios, but are likely to soon be the property of the state of Rhode Island following a loan that's unlikely to be paid back.

An anonymous ex-Big Huge Games staffer cleared up a common misconception, stating that in its day to day interactions Big Huge Games remained completely separate from 38 Studios. "Reckoning was developed with EA publishing money, NOT Rhode Island tax dollars... It had nothing to do with the $50 million dollars from RI. That money went directly to the MMO project."

Despite 38 Studios' financial troubles, there's still a chance the Reckoning sequel could resurface under a different IP. In fact, Reckoning was originally conceived as an RPG called "Ascendant" at THQ, before it was converted to suit the Amalur universe. If another publisher picks up its existing framework, we could see BHG staffers pull the same trick again.