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In this study, an algae biomass gasification process using a dual fluidized bed with combined power and methanol cogeneration was developed. The gasification process was modeled using Aspen Plus and validated using experimental data of two microalgae species (<i>Nannochloropsis oculata</i> and <i>Dunaliella salina</i>) commonly found on the western coast of Saudi Arabia. The impacts of different operating conditions, including the gasifier temperature, steam-to-biomass ratio, and algae-char split ratio, on the compositions of four main gases (CO, CO₂, CH₄, and H₂) were investigated. The results of the parametric studies indicated that the gasification temperature has a significant effect on the composition of the synthesis gas, where 700–850 °C was the ideal operating range for gasification. Altering the ratio of biomass to steam showed a slightly smaller effect on the synthesis gas composition. The char split ratio should be kept below 75% to ensure an adequate heat supply to the process. The proposed process successfully converted 45.7% of the biomass feed to methanol at a production capacity of 290 metric tons per day. On the other hand, 38 MW of electricity capacity was generated in the combined power cycle.