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Solazyme, producer of renewable oil derived from algae, just raised $57 million in third-round funding to bring its total capital to more than $76 million. In addition to producing so-called green fuels, the San Bruno, Calif., company is expanding its eco-friendly chemicals business — an increasingly common move for companies in the biofuel space. It is also exploring nutritional and cosmetics opportunities.

The bulk of the funding came from VantagePoint Venture Partners, which has made a strong push in cleantech recently. The firm also invests in electric car charging company Better Place, solar companies BrightSource Energy and Miasole, and perennial favorite Tesla Motors. Jazem Family Partners, Roda Group, Harris & Harris Group, Braemar Energy Ventures and Lightspeed Venture Partners have also backed the algal fuel and chemical company in the past.

Last year, Solazyme struck a partnership with Chevron to further develop and scale its fuel production. The oil and gas giant was motivated by its agreement with the Department of Energy to produce fuels from algae. The major hurdle standing between the technology and commercial distribution is cost. Today, algae is a very local source of fuel — it doesn’t travel well and is generally costly to transport. These problems must be overcome before it can become a profitable business.

Solazyme competes with companies like LiveFuels, Aurora Biofuels, and Cellana.

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