A case study of model selection and parameter inference by maximum likelihood with application to uncertainty analysis

One of the uses of geostatistical conditional simulation is as a tool in assessing the spatial uncertainty of inputs to the Monte Carlo method of system uncertainty analysis. Because the number of experimental data in practical applications is limited, the geostatistical parameters used in the simulation are themselves uncertain. The inference of these parameters by maximum likelihood allows for an easy assessment of this estimation uncertainty which, in turn, may be included in the conditional simulation procedure. A case study based on transmissivity data is presented to show the methodology whereby both model selection and parameter inference are solved by maximum likelihood.