Where’s the Contact sequel?

Hearing this past week’s news about Goichi Suda and Grasshopper Manufacture working on No More Heroes 2, the studio’s first sequel, has me wondering about the other Grasshopper game sequel that was promised, Contact 2.
I’m probably one of only a few dozen people looking for a follow-up to this flawed, unique game, but I’d like to see how Contact turns out with its past faults — shallow combat and an unintuitive costume system — remedied.
To me, the original Contact’s frequent video game allusions, disregard for the fourth wall, and uncommon visual style combining simple sprites with lush, pre-rendered environments, made up for those failings.
While completing Contact in early 2006, director Akira Ueda parted ways with Grashopper and formed his own studio, Audio Inc., which was supposed to be working on the sequel for an unannounced Nintendo platform.
Since then, however, Audio has put out Deltora Quest and Majin Tantei Nougame Neuro, both licensed titles for the DS and neither seeing a stateside release, without a single mention of Contact 2, as far as I know. I hope they haven’t abandoned the project.
Though I wasn’t able to find any news about the sequel on Audio’s company blog (Japanese), I did come across this wicked Mochi Dot-S diorama and Mochi kaleidoscope:











