Commercial production of microalgae biofuel is not economically feasible since it cannot compete with the price of fossil fuels. Algal biofuel could be cost-effective if high-value co-products are produced from microalgal biomass before it is converted into biofuel. Thus, this research aims to demonstrate a circular biorefinery process of producing bio-crude bio-oil as well as high-value products like carotenoids from a marine microalga Nannochloropsis oceanica. The microalga was cultivated in raceway ponds over the years with the highest biomass productivity of 30–40 g m−2 day−1 recorded in October and November of 2021, but it reduced in extremely high summer temperatures and low temperatures in winter of Delhi NCR, India. The annual average biomass productivity of 19.13 g m−2 day−1 was recorded, which is equivalent to 69825 kg ha−1 year−1. The algal biomass was processed for high-value carotenoids using a green process, i.e. supercritical carbon dioxide extraction. Carotenoid yield of 252 μg/g of biomass was obtained after optimizing temperature and pressure in the supercritical extraction process. The spent biomass after carotenoid extraction was used to produce bio-crude bio-oil using hydrothermal liquefaction. There was no significant difference between bio-crude oil yield and properties after carotenoid extraction and direct biomass use. A bioeconomic methodology for closing the circular loop involving recycling the effluent generated during hydrothermal liquefaction to re-cultivate the microalgae is demonstrated. This study highlights the potential of green technology, circular bioeconomy, and biorefinery practices in developing sustainable and environmentally friendly solutions for the chemical and energy sectors.