A novel circulating fluidized-bed membrane reactor employing a reactor-regenerator type of configuration is proposed for hydrogen production by the steam reforming of natural gas. The reactor section of this configuration is investigated. CO2 sequestration using the CO2-lime reaction is utilized to assist/replace the hydrogen permselective membranes for "breaking" the thermodynamic equilibrium of the reversible reforming reactions. Cases with and without CaO and hydrogen permselective membranes are considered and compared. A slip velocity factor is incorporated to investigate the effect of CaO particle size/residence time on the conversion of lime and the overall performance of the reformer.