The current systems for air independent propulsion systems are based on hydrogen stored in a limited number of cylinders for the continuous operation of the fuel cells in marine vehicles. Hydrogen generation by on-board steam reforming of methanol could extend the air-independent period. This study presents an autothermal reactor for the coupled endothermic (methanol steam reforming) and exothermic (oxidation) reactions in a compact reactor. A commercial Cu-based catalyst (ReforMax® M) was used. The kinetics of both reactions were evaluated over a wide range of conditions. This catalyst was found to be very stable under moderate operating conditions (<270 °C and O2/CH3OH <0.03), obtained by injecting oxygen at four different points along the reformer. Based on the catalytic performance, an integrated process was developed by a simulation program. The system was designed to operate for a long time (>500h). The combined process provides operational advantages, high energy efficiency (84.2%) and hydrogen yield (75.2%).