The prolific Permian Basin could turn out to be too popular among exploration and production companies, that could clog the play and reduce efficiency, Wood Mackenzie said in a report on the oil and gas field.

The Wood Mackenzie analysts said the Permian alone can produce more than 5 million barrels of oil per day by 2025. But if well spacing continues to tighten, well-on-well interference could reduce the play's peak levels.

"Technology gains in the past few years have propelled Permian well performance to new levels. However, industry is set up to develop the Permian region's shale zones at an unparalleled level, testing the geological limits of the play," said Robert Clarke, the firm's research director for Lower 48 upstream and the report's lead author. "It is very likely that the upcoming level of activity will introduce a new set of issues, particularly reservoir deliverability."

Wood Mackenzie said the Permian is unlike any other unconventional play in that there are few elements of outside interference to disrupt production. The firm noted that Marcellus Shale production "hit regulatory and midstream bottlenecks," the Haynesville was slowed by the oil and gas price collapse, and the Eagle Ford's "sweet spots" were not as large as originally anticipated.

"In the Permian, the growth challenge could relate to the industry ultimately finding hard subsurface limits for tight oil recovery," Wood Mackenzie said. The firm determined that well interference during the fracking process could reduce the estimated ultimate recovery value by 30% compared with today.

"These reservoir issues could begin to manifest as sweet spots become exhausted. Taking into account some bearish assumptions, if future wells tap more difficult rocks, and are not offset by continued technology evolution, the Permian may peak in 2021," Clarke said. One of the major causes of well interference could be "child wells," or infield wells near older, still-producing wells.

"Leaning on history again, we believe future child wells, because they're effectively drilled into pressure sinks, could have [estimated ultimate recoveries] 20-40 percent smaller than their parent producers. This would massively impact production growth and also limit the amount of cash flow available for reinvestment," Wood Mackenzie analyst Alex Beeker said.