Those who have been following the BP (NYSE: BP) and Transocean (NYSE: RIG) oil spill are thrilled at the progress that's been made in halting the oil gushing into the Gulf of Mexico.

That's particularly true of folks who earn their living along the Gulf coast. But those in closest proximity to the disaster also know huge steps need to be taken before they can wash their hands of this nightmarish affair.

First on the list is returning the industry to work in the Gulf. Despite lawsuits filed by drillers Noble (NYSE: NE) and Ensco (NYSE: ESV), the administration is persisting with a second drilling moratorium that could leave tens of thousands of rig hands and others without income for at least several months. With some Gulf rigs and workers already headed for other venues, a number of years could be required for the Gulf to return to fully active production status.

Then there are the new offshore drilling regulations being discussed in Congress. As The Wall Street Journal noted earlier this week, these strict rules likely would require redundancies for several types of rig equipment. Included would likely be a second set of shear rams on the blowout preventer to cut through the drill pipe and halt oil flow in the event of a repeat of what seems to have happened.

The big difficulty there is the cost, especially for companies which operate older fleets. Also, older and smaller rigs may not have the space and lifting capacity to handle the heavier equipment that may be mandated.

Diamond Offshore (NYSE: DO) has been an attractive member of the offshore drilling cadre, in large part because of its deepwater capabilities and the special dividends it's been parceling out to shareholders. However, that dividend has now been cut to preserve the company's cash for second control systems, or whatever equipment the regulators determine should be added to rigs operating in the Gulf.

And last, but hardly least, will be the decades of litigation that will spring from the tragedy. While most will probably be directed toward BP and Transocean, I wouldn't count Halliburton (NYSE: HAL), which handled the well's cementing, as being out of the woods yet.

Since you really need to include energy names in your portfolios, I continue to like ExxonMobil (NYSE: XOM), which from wisdom or luck, pretty much avoided the Gulf disaster.

Fool contributor David Lee Smith doesn't own shares in any of the companies mentioned in this article. He does, however, encourage you to send along your comments or questions. The Fool owns shares of Noble and has a disclosure policy