HYL III is another gas based DRI process. The process uses reducing gases within a moving bed shaft furnace reactor to remove the oxygen from iron ore pellets and lump ore. In comparison to other similar technologies, it operates a slightly higher reduction temperatures (~ 930 ºC) and intermediate reduction pressures (up to 6 bars).  The process can produce cold and hot DRI as well as Hot Briquetted Iron (HBI).

The HYL III plant comprises two main process sections: the reducing gas generation and the reduction sections. Typically, the reducing gas generation section consists of a conventional natural gas-steam reformer to produce the H₂ and CO required as make-up for the reduction process. The basic components of the reduction circuit, aside from the reactor, are: a gas heater to increase the reducing gases temperature up to 925°C; a scrubbing unit for dedusting, cooling and H2O elimination from top gases; the recycle gas compressor and the CO₂ removal unit.

As the process includes a sulfur removal step prior to the conventional steam reformer, it can utilize higher-sulfur ore and gas feeds. A better control of the reducing gas CO to H₂ ratio since it is equiped with a selective CO₂ removal circuit in a circulating gas system. This allows a wide range of CO to H₂ ratios to be used depending on the required degree of metalization and/or carbon content.