For the first time the influence of CO, CO2 and H2O content on the performance of chlorinated Ni–CeO2 catalyst in selective or preferential CO methanation was studied systematically. It was shown that the rate of CO methanation over Ni(Cl)/CeO2 increases with the increasing H2 concentration, is independent of CO2 concentration and decreases with increasing CO and H2O concentrations; the rate of CO2 methanation is weakly sensitive to H2 and CO2 concentrations and decreases with increasing CO and H2O concentrations. High catalyst selectivity was attributed to Ni surface blockage by strongly adsorbed CO molecules and ceria surface blockage by Cl, which both inhibit CO2 hydrogenation. For the first time, selective CO methanation over Ni(Cl)/CeO2 was studied for deep CO removal from formic acid derived hydrogen-rich gases characterized by high CO2 (40–50 vol%), low CO (30–1000 ppm) content and trace amounts of water. Composite Ni(Cl)/CeO2-η-Al2O3/FeCrAl wire mesh catalyst was demonstrated to be effective for this process at temperatures of 180–220°С selectivity 30–70%, WHSV up to 200 L (STP)/(g∙h). The catalyst provides high process productivity, low pressure drop, uniform temperature distribution, and appears highly promising for the development of a compact CO cleanup reactor. Selective CO methanation was concluded to be a convenient way to CO-free hydrogen produced by formic acid decomposition.