The correct answer is Option 2: 2 and 3 only.

1. Production of algae based biofuels is possible in seas only and not on continents.

This statement is incorrect. Algae can be produced in various aquatic environments such as oceans, lakes, rivers, and even in wastewater. Additionally, algae can be grown in closed systems such as photobioreactors or open ponds. Therefore, the potential for algae-based biofuels production is not limited to seas only.

2. Setting up and engineering the algae based biofuel production requires high level of expertise/technology until the construction is completed.

This statement is true. Algae-based biofuel production requires specialized knowledge and technology, particularly in the areas of biology, chemistry, and engineering. The process of cultivating and harvesting algae, extracting and converting lipids into fuel, and refining the final product into a usable biofuel requires a skilled workforce with specialized training. Developing countries may lack the technical expertise and infrastructure necessary to support the establishment of a successful algae-based biofuels industry.

3. Economically viable production necessitates the setting up of large scale facilities which may raise ecological and social concerns.

This statement is also true. Algae-based biofuels production requires large-scale facilities to achieve economies of scale and produce fuel at a competitive price. However, the establishment of such facilities may raise ecological and social concerns, particularly in developing countries. For example, large-scale algae cultivation may require significant amounts of land, water, and energy, which could compete with food production and exacerbate existing water scarcity issues. Additionally, the construction of algae production facilities may displace local communities or cause other social and environmental impacts that must be addressed.

In conclusion, the limitations of developing countries in promoting an algae-based biofuels industry include the need for specialized knowledge and technology and the potential ecological and social impacts of large-scale production. However, with appropriate support and investment in research, infrastructure, and workforce development, developing countries can overcome these limitations and leverage the potential benefits of algae-based biofuels, including reduced greenhouse gas emissions and increased energy security.