There has been growing concern about the way cultivating biomass for the production of agro-biofuels competes with food production. To avoid this competition biomass production for biofuels will, in the long term, have to be completely decoupled from food production. This is where microalgae have enormous potential. Here we propose a novel process based on microalgae cultivation using dilute fossil CO₂ emissions and the conversion of the algal biomass through a catalytic hydrothermal process. The resulting products are methane as a clean fuel and concentrated CO₂ for sequestration. The proposed gasification process mineralizes nutrient-bearing organics completely. Here we show that complete gasification of microalgae (Spirulina platensis) to a methane-rich gas is now possible in supercritical water using ruthenium catalysts. 60–70% of the heating value contained in the algal biomass would be recovered as methane. Such an efficient algae-to-methane process opens up an elegant way to tackle both climate change and dependence on fossil natural gas without competing with food production.