Exergy analysis has been performed for identifying the causes, locations, and magnitudes of process inefficiencies for the COREX process. A composite model of the COREX process (i.e., models for the smelter gasifier and the reduction shaft) using FactSage 6.2 (Thermfact/CRCT, Montreal, Canada, and GTT Technologies, Aachen, Germany) is used to generate stream data for exergy computation. The effect of use of methane as an auxiliary fuel and high ash coal in smelter-gasifier has been investigated through the model. A new methodology for the calculation of exergy of the process streams using the database in FactSage is proposed in this work. The exergy loss/destruction (measure of the thermodynamic irreversibility) and exergy efficiencies of the COREX process are evaluated at various coal rates and compared with those of the blast furnace. Operating the COREX process is theoretically feasible at lower coal rates with higher exergy efficiencies when lesser export gas is generated.