Parameter estimation through robust parameterization techniques has been addressed in many works associated with history matching and inverse problems. Reservoir models are in general complex, nonlinear, and large-scale with respect to the large number of states and unknown parameters. Thus, having a practical approach to replace the original set of highly correlated unknown parameters with non-correlated set of lower dimensionality, that captures the most significant features comparing to the original set, is of high importance. Furthermore, de-correlating system's parameters while keeping the geological description intact is critical to control the ill-posedness nature of such problems. We introduce the advantages of a new low dimensional parameterization approach for reservoir characterization applications utilizing multilinear algebra based techniques like higher order singular value decomposition (HOSVD). In tensor based approaches like HOSVD, 2D permeability images are treated as they are, i.e., the data structure is kept as it is, whereas in conventional dimensionality reduction algorithms like SVD data has to be vectorized. Hence, compared to classical methods, higher redundancy reduction with less information loss can be achieved through decreasing present redundancies in all dimensions. In other words, HOSVD approximation results in a better compact data representation with respect to least square sense and geological consistency in comparison with classical algorithms. We examined the performance of the proposed parameterization technique against SVD approach on the SPE10 benchmark reservoir model as well as synthetic channelized permeability maps to demonstrate the capability of the proposed method. Moreover, to acquire statistical consistency, we repeat all experiments for a set of 1000 unknown geological samples and provide comparison using RMSE analysis. Results prove that, for a fixed compression ratio, the performance of the proposed approach outperforms that of conventional methods perceptually and in terms of least square measure.