On-line Korean game developer, Bluehole Studio Inc., has plans to create a blockbuster role-playing game for the PC using the tool set of Epic Games’ Unreal Engine 3.

The game engine technology, now licensed to Bluehole, sets the stage for the newly formed studio to produce Project S1 – the codename for its next-generation, massively multi-player on-line role-playing game (MMORPG).

“Without a doubt, Bluehole is positioned to push the envelope with Unreal Engine 3,” said Jay Wilbur, vice president of Epic Games. “Given Bluehole’s pedigree and its ambitious plans to reinvent MMO design and battle system mechanics, Epic is honored to provide the core development tools and infrastructure for this project.”

Meanwhile, New Line Cinema who acquired the rights to Epic’s breakthrough game, Gears of War, is adapting the Xbox 360 hit in to a movie script. Recent reports indicate a director is in place and targeting a theater debut for summer 2010.