We're in for a long wait to play In The Valley of Gods, as it seems ValveTime has caught up with the Campo Santo (Firewatch) team that joined Valve back in 2018.
Around the time Half-Life: Alyx was being rumoured and then announced, it was noticed that the people who were working on In The Valley of Gods had their Twitter bios changed to remove any mention of it. We know why now though, as Polygon got a statement from Campo Santo co-founder Jake Rodkin where they note it's now "on hold".
They mention that some of them ended up working full-time on Half-Life: Alyx, others Dota Underlords, Steam itself and so on. Here's their full statement:
To fans looking forward to In the Valley of Gods, it’s probably clear that the optimistic “2019” at the end of the announcement trailer isn’t going to be accurate. In the end, Valve Time makes fools of us all. But yes, developers from the former Campo Santo team have joined other projects at Valve, including Half-Life: Alyx. As you can imagine, our experience in the first-person adventure genre is pretty relevant. You hear a lot about how at Valve you can work on what you want. It turns out that’s true, and there’s a lot of work available. As we integrated ourselves into Valve it became clear there was a lot of valuable work to be done on Half-Life: Alyx. Some of us starting lending a hand, and have since become full-time on the project as it approaches launch. Similarly, some ex-Campos are working on Dota Underlords, some are on Steam, and so on. So to answer your question as of today, In the Valley of Gods development is on hold—but it certainly feels like a project people can and may return to. And when that happens, we’ll find an exciting way to let fans know.
The Steam page for In The Valley of Gods can be found here, with a release date that's now "TBD"