The game is set in 1899, sixty years after Amnesia: The Dark Descent. Though there's no direct connection with that game, it will share "the same universe". It stars a "rich industrial tycoon" named Oswald Mandus, who wakes up on New Year's day in London with a bad case of (you guessed it) amnesia. He's spent months in a nightmare-filled coma after a "disastrous and tragic" expedition to Mexico, and now he must find the truth behind a mysterious machine he saw there, while piecing together his memories. Also he will be terrified.
Dear Esther writer Dan Pinchbeck will be acting as lead designer and writer, and Frictional will be acting in a production role. The game will use Frictional's HPL2 engine, and while its gameplay will be featuring elements from The Dark Descent, new ones will be added and "people going in will not know what to expect". Other than to be terrified, I imagine.
It's due on PC, Mac and Linux, and they're hoping to launch before Halloween 2012. Read the rest of the interview at Joystiq for more details, some concept art, and a hilarious anecdote about ARGs and a Chinese restaurant.
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destructoid's previous coverage: amnesia: a machine for pigs