Underground hydrogen storage (UHS) has attracted increasing attention as a promising technology for the large-scale storage of renewable energy resources and the decarbonization of energy systems. This study aimed to identify critical parameters influencing UHS performance, particularly the role of hydrogen conversion via in situ methanation and hydrogen recovery during production cycles. The main focus is the Lehen field in Upper Austria, where a pilot hydrogen storage project was conducted under the leadership of RAG Austria AG. A layered reservoir model was developed on the basis of well-log data to simulate the field trials that occurred in 2016. A sensitivity analysis was performed with the one-parameter-at-a-time (OPAAT) method and the response surface methodology (RSM) to evaluate the impacts of different parameters on hydrogen methanation and hydrogen recovery. The RSM results indicate the activation energy as the most influential factor on methanation that accounts for ∼20,000 moles variation in generated methane, significantly higher than the 6000 moles variance observed in OPAAT. However, initial CO2 content contributes up to 15,000 moles of methane generation as per RSM, whereas OPAAT results in a larger impact of up to 32,000 moles. These discrepancies demonstrate the limitations of isolated parameter analyses like OPAAT, which may not accurately capture the complex interactions between factors influencing the methanation process. This research provides valuable insights for optimizing UHS performance by emphasizing the influence of reservoir parameters on storage efficiency. In addition, a robust workflow for conducting comprehensive sensitivity analyses of UHS systems is established. By understanding these key factors, the potential and predictability of large-scale UHS systems can be significantly improved.