Published: Oct 29, 2011 9:09 AM EDT
Updated: Oct 30, 2011 6:30 AM EDT

SHANGHAI (AP) - U.S. Open champion Rory McIlroy increased his lead to three strokes after shooting a 7-under 65 in the third round of the Shanghai Masters on Saturday.

The 22-year-old Northern Irishman made seven birdies in another bogey-free round on the Jack Nicklaus-designed course at Lake Malaren on the outskirts of Shanghai to total 18-under 198.

McIlroy is a step closer to the tournament's $2 million first-place prize money, the richest in golf and bigger than the $1.44 million he pocketed for winning the U.S. Open in June.

Anthony Kim of the United States moved up a spot to second after hitting three consecutive birdies to close out the front nine and another four on the back nine to match McIlroy's 65. His only misstep was a bogey on the 18th hole.

Kim, a three-time winner on the PGA Tour, is looking for his first victory of the year. His best finish was a share of fifth place at the British Open.

South Korea's Noh Seung-yul was one stroke behind Kim at 14 under after following up his second-round 63 with a 67.

Ian Poulter (67) and Hunter Mahan (68) were next at 11 under. Second-ranked Lee Westwood (70) and Geoff Ogilvy (66) were at 7 under, followed by Robert Karlsson (72), Padraig Harrington (73) and Y.E. Yang (68) at 6 under.

Louis Oosthuizen of South Africa, who started the day equal third, had a terrible round in the overcast conditions, hitting four bogeys and a double bogey on the par-5 13th hole for a 76. The 2010 British Open champion fell to joint 12th at 4 under.

There are 30 players competing in the lucrative invitational tournament, being held for the first year. All the top players are receiving appearance money, and last place pays $25,000. Because the International Management Group-run event isn't sanctioned by a major tour, it doesn't have world-ranking points.