We now know how the Gulf of Mexico drilling moratorium is affecting drill rig operators, and it isn't pretty. Noble (NYSE: NE) reported revenues that fell 33% from last year to $585 million as rigs sat idle in the Gulf this quarter. Earnings were $86 million, or $0.34 per share, down from $426 million, or $1.63 per share, last year.

There is still a lot of uncertainty surrounding when drilling to get back to full speed, as we warned last week. The next couple of quarters are a roll of the dice, but Noble does have $14 billion of backlog and added 23 rig years of drilling contracts with Shell (NYSE: RDS-A) in the acquisition of Frontier, so going forward, demand looks strong.

Fleet utilization is at 72% for the fourth quarter and 50% for 2011, showing the short-term lack of demand in the Gulf. But the company did say major customers are still planning on moving forward in the Gulf long-term and that it didn't see an exodus of rigs from the area.

Before getting back to work in the Gulf, blowout preventers must be certified by a third party, and Noble said it was making progress on that front. It expects certified rigs to be back to work as soon as possible. It's just a question of how long that is.

The entire sector's profits are going to be hurting for some time, but Noble has taken the brunt of it. Diamond Offshore's (NYSE: DO) profits fell 45% in the third quarter, while Ensco (NYSE: ESV) posted a less disappointing 8.9% drop in profits. We will have to wait a couple of weeks before the biggest driller, Transocean (NYSE: RIG), reports results in early November, but it should give us a broad view of how regulations and demand are playing out.

Noble shares are down, but investors have largely shrugged off the bad news today in favor of looking forward to positive trends. There is a lot of uncertainty going forward, however; as oil companies rush back into the Gulf, demand will rise for Noble's rigs. I like the company's long-term prospects, but it could be a bumpy ride for the next few quarters.

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Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings, or follow his Motley Fool CAPS picks at TMFFlushDraw. The Fool owns shares of Ensco and Noble. Try any of our Foolish newsletter services free for 30 days.

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