Abstract: The iron and steel industry serves as a vital foundation of the national economy, yet it is also highly energy-intensive and a major source of carbon emissions, making it a key focus for energy conservation and emission reduction. Based on the principle of Gibbs free energy minimization, a heat balance model was developed for the coal gasification-direct smelting reduction ironmaking process, and a thermodynamic equilibrium analysis was carried out. The process was divided into two stages, pre-reduction and molten pool, for individual investigation, focusing on the influence of key operating parameters on equilibrium temperature, iron ore reduction degree, gas composition, and gas utilization efficiency. In the pre-reduction stage, a temperature limit of 1300°C was applied to define the feasible operating range, ensuring that solid products melt before entering the molten pool. The optimal operating conditions identified were: pulverized coal feed rate of 1000?kg/h, ore-to-coal ratio of 1.43, oxygen-to-coal ratio of 0.8, and steam-to-coal ratio of 0.01. For the molten pool stage, the best performance was achieved with a CO conversion rate of 0.5 in the water-gas shift reaction, recirculating 54% of the gas back into the molten pool, and an oxygen supply rate of 110?kg/h. Under these conditions, complete reduction of iron ore (100%) was attained, with an H2/CO ratio of 2.06, an equilibrium bath temperature of 1482°C, and a coal consumption of 1?t/t-Fe—comparable to other smelting reduction processes such as Corex and HIsmelt. Notably, while maintaining the coal consumption at 1?t/t-Fe, this process co-produces 525?kg of methanol, thereby significantly improving overall energy utilization efficiency.