Yes, that is correct. The story is considered one of the best among video games. The story has many parallels to Colony:
- Initial alien "invasion" and apocalyptic events
- The aliens don't care one bit about earth or humans, they didn't even really want to be here in the first place, and they are fleeing a much worse enemy
- Occupation/resistance/collaboration
Everyone was expecting at the very least one more short episode or better yet, one more full game to complete the story. Valve (the developer) have also at various times long ago confirmed they were working on multiple additional episodes. But it's been 12 years now, it never happened, and they stopped answering questions about it long ago.
The lack of finishing it is sort of inexplicable, because the games were a huge success on every level (sales numbers, fan ratings, and critic ratings). And the company itself is doing well, so they certainly have the resources to do it.
Anyway, back to the topic. One of the writers for the story in the game tweeted out an outline of where they were going so that fans could at least have closure. I'd like to see closure like that for Colony.