Personally, I don't see why not, it would take quite a lot of scripting though, you would have to program the chess engine into Lua. A very difficult job but not impossible.
First of all, you will need the pieces made up, either by you or get someone else to do it, the board, of course, would be easy.
Of course, if you were going to make it a two player game that was played over the net then this would be much simpler, all you would need to do then is program the correct moves for each piece and get it to know when someone has "Check Mate" or "Mate".
Not quite as simple as I have made it sound there but you get the idea, It is a very complex game when put into programming that is why it took quite a long time initially to get right. Of course, there are programs out there that you could use if you were able to translate them into Lua. It would be interesting if someone could do this, let me know how you get on if you decide to attempt it.
I hope this was helpful.
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