This report documents the Observation, Sensitivity, and Parameter-Estimation Processes of the ground-water modeling computer program MODFLOW-2000. The Observation Process generates model-calculated values for comparison with measured, or observed, quantities. A variety of statistics is calculated to quantify this comparison, including a weighted least-squares objective function. In addition, a number of files are produced that can be used to compare the values graphically. The Sensitivity Process calculates the sensitivity of hydraulic heads throughout the model with respect to specified parameters using the accurate sensitivity-equation method. These are called grid sensitivities. If the Observation Process is active, it uses the grid sensitivities to calculate sensitivities for the simulated values associated with the observations. These are called observation sensitivities. Observation sensitivities are used to calculate a number of statistics that can be used (1) to diagnose inadequate data, (2) to identify parameters that probably cannot be estimated by regression using the available observations, and (3) to evaluate the utility of proposed new data.

The Parameter-Estimation Process uses a modified Gauss-Newton method to adjust values of user-selected input parameters in an iterative procedure to minimize the value of the weighted least-squares objective function. Statistics produced by the Parameter-Estimation Process can be used to evaluate estimated parameter values; statistics produced by the Observation Process and post-processing program RESAN-2000 can be used to evaluate how accurately the model represents the actual processes; statistics produced by post-processing program YCINT-2000 can be used to quantify the uncertainty of model simulated values.

Parameters are defined in the Ground-Water Flow Process input files and can be used to calculate most model inputs, such as: for explicitly defined model layers, horizontal hydraulic conductivity, horizontal anisotropy, vertical hydraulic conductivity or vertical anisotropy, specific storage, and specific yield; and, for implicitly represented layers, vertical hydraulic conductivity. In addition, parameters can be defined to calculate the hydraulic conductance of the River, General-Head Boundary, and Drain Packages; areal recharge rates of the Recharge Package; maximum evapotranspiration of the Evapotranspiration Package; pumpage or the rate of flow at defined-flux boundaries of the Well Package; and the hydraulic head at constant-head boundaries. The spatial variation of model inputs produced using defined parameters is very flexible, including interpolated distributions that require the summation of contributions from different parameters.

Observations can include measured hydraulic heads or temporal changes in hydraulic heads, measured gains and losses along head-dependent boundaries (such as streams), flows through constant-head boundaries, and advective transport through the system, which generally would be inferred from measured concentrations.

MODFLOW-2000 is intended for use on any computer operating system. The program consists of algorithms programmed in Fortran 90, which efficiently performs numerical calculations and is fully compatible with the newer Fortran 95. The code is easily modified to be compatible with FORTRAN 77. Coordination for multiple processors is accommodated using Message Passing Interface (MPI) commands. The program is designed in a modular fashion that is intended to support inclusion of new capabilities.