They ran into a dead end. To get the fuel (forms of alcohol the cells produce) out of the cells, you have to kill them first. That means the process wasn't scalable with the technology available then.
Today, the algae are genetically modified with excretion systems from other organisms, so that they pump out the fuel into the surrounding medium, where it can be easily harvested without having to kill the entire culture for each "harvest". This means the process may become scalable in the near future: A constant culture of cells that continue to grow and pump out fuel as long as you keep feeding them. The latest news I heard was that they managed to do this, proof-of-concept-wise. That was about two months ago.