Most of the time a pistol is completely done after a bulge. But because the HP barrel is so long, you may have lucked out.
If the gun still cycles, the action locks up tight, and it can still be field stripped, it might be ok. Sanding a half a mic off the OD here or there is probably all it needs to get rid of the jamming. If it were much more, the gun wouldn't function, at all. I'm not saying that's the safest course of action, mind you.
The accuracy of a barrel comes from the last half an inch. POI might change a hair, but I bet that's fine, too. As long as the gun locks up tight, it will probably be just as accurate. It really doesn't matter how sloppy the barrel is when the action unlocks. Heck, on a Glock the barrel moves around all over the place when the gun isn't in battery.
BTW, barrels get that kind of bulge from obturation of the obstructed round when the next bullet hits it. The bullet turns into a pancake and presses the barrel outwards. (The bullet that slams into the obstructed bullet also obturates a little. If you look close you can probably see 2 rings inside the barrel). Gas pressure does not bulge the barrel like that. Even though the barrel is weakened a little, it's not really that important at that particular spot in your pic.
If a 9mm pistol is going to kB, it's going to happen from a ruptured case over the feedramp and/or from an open breech, or from a double/triple charge that splits the chamber. It's not going to blow out in that spot. Look at the barrel on a shotgun. There's not a whole lot of pressure to contain once the bullet leaves the chamber.
I've shot a Bersa .380 with a bulge that looked quite similar, only closer to the breech. The gun functioned, perfectly. Accuracy was superb, before and after.