March is known as the green month, so it's fitting that only one week into it there's already some interesting news for algae fuel supporters.

Agricultural giant Monsanto today announced it's signed a deal with algae-crude producer Sapphire to collaborate on genetic engineering research that could be applied to both algae and agricultural crops.

The research involves identifying traits in algae genes for growth and durability. But the science can also be applied to plants like cotton, soybeans, and corn, according to Sapphire.

As part of the deal, Monsanto is making "an equity investment" in Sapphire, but the details of that investment were not disclosed. Other investors in Sapphire include Bill Gates' investment firm Cascade Investment, Venrock, Arch Venture Partners, and Wellcome Trust.

"For Sapphire, this collaboration will push the known boundaries of algae science to search not only for traits that will impact traditional agricultural crops, but will also accelerate Sapphire's road to commercializing algae as a renewable energy crop," Sapphire said in a statement.

Monsanto is known for, and in many circles criticized for, its pro stance on genetically engineered crops, as well as its business practice of charging farmers royalties on seeds gleaned from crops originally grown from Monsanto seeds. Because of this, many will be closely watching how Monsanto's participation in producing crude algae, the liquid produced by algae farms that can be used to make biofuels for cars and planes, might affect the algae fuel market down the road.

Meanwhile, VG Energy released a report Wednesday claiming it's made a breakthrough that could dramatically increase the scalability of algae for fuel.

The company used a recent discovery in cancer treatment and applied the science to algae with preliminary success.

"Laboratory experiments show that molecules, which can disrupt the burning of fats (lipids) in tumor cells, can also encourage microscopic plant cells like algae to accumulate and even secrete fats. These fats can be used to produce diesel and jet fuel substitutes for traditional petroleum fuels," according to the report "The Potential Impact of VG Energy's Lipid Oxidation Inhibitors on the Economics of Algal Biofuels" (PDF).

The report was written by John Sheehan, a technical advisory board member of VG Energy's parent company Viral Genetics, who is currently the Biofuels Coordinator at the Institute on the Environment at the University of Minnesota and a former project manager at the National Renewable Energy Laboratory (NREL).