Biomass gasification produces syngas, mainly comprised of CO and H2 along with H2S, CO2, N2, and tar compounds. Inorganic carbon present in syngas as CO and CO2 can be utilized for the production of several value-added chemicals including ethanol, higher alcohols, fuels, and hydrogen. However, chemical sequestration operates at a high temperature of 300–500 °C and pressure of 3–5 MPa in the presence of heavy metal catalysts. Catalyst regeneration and the maintenance of high temperature and pressure increased the cost of operation. Microorganisms like algae and bacteria including Acetobacterium and Clostridium also have the potential to sequester carbon from the gas phase. Research has emphasized the production of microbial metabolites with a high market value from syngas. However, scale-up and commercialization of technology have some obstacles like inefficient mass transfer, microbial contamination, inconsistency in syngas composition, and requirement for a clean-up process. The current review summarizes the recent advances in syngas production and utilization with special consideration of alcohol and energy-related products along with challenges for scale-up.