To make algal biofuel economically viable, extraction of value-added coproducts, along with oil, appears absolutely necessary. The major barrier in algal coproduct development is the lack of an efficient separation technology. To address this issue, a unique two-step

sequential hydrothermal liquefaction (SEQHTL) technology for the simultaneous production of value-added polysaccharides and bio-oil from algal-biomass was developed. The first step involves the subcritical water extraction of valuable algal (Chlorella sorokiniana) polysaccha­rides at 160°C. The polysaccharide-rich water extract was removed and precipitated with ethanol. In the next step, the extracted biomass was liquefied to bio-oil at 300°C. The yield of bio-oil by SEQHTL was 24% of the dry wt. In addition, this method also extracted 26% of the polysaccharides present, whereas direct hydrothermal liquefaction (DIRHTL) generated only 28% bio-oil. In the SEQHTL method, biochar formation was remarkably low, and as such, SEQHTL produced 63% less biochar than DIRHTL. The yield of biochar production is negligible correlated to polysaccharide content (p > 0.98), suggesting a majority of carbohy­drates present in algal biomass were converted into biochar. This conversion did not signif­icantly influence the bio-oil production. Comparative GC-FID, GC-MS, NMR, FT-IR analysis and ESI-MS of the bio-oil extracted by SEQHTL with DIRHTL showed no significant differences. Elemental analysis of the SEQHTL bio-oil demonstrated that it contained 70% carbon, 0.8% nitrogen, and 11% oxygen (Chakraborty et al., 2012).