* Report sees temporary loss of 8,000-12,000 jobs
* No discernible effect on oil prices from moratorium
By Jeff Mason
WASHINGTON, Sept 16 (Reuters) - The economic costs of the Obama administration's six-month moratorium on deepwater drilling in the Gulf of Mexico will be less severe than first feared, according to a U.S. government report released on Thursday.
The inter-agency report, which was based on economic data and interviews with oil rig operators, projected up to 12,000 temporary job losses in the region -- a lower figure than the 23,000 projected in an earlier Interior Department report.
"We estimate that the six-month moratorium may temporarily result in up to 8,000 to 12,000 fewer jobs in the Gulf Coast," the report said. "These jobs would not be permanently lost as a result of the moratorium; most would return following the resumption of deepwater drilling in the Gulf of Mexico."
The Obama administration put the moratorium in place after the BP oil spill that began in April after the Deepwater Horizon rig exploded and sank, killing 11 people and sparking one of the biggest environmental disasters in U.S. history.
The administration said the moratorium was necessary to ensure further accidents did not occur. The industry and some lawmakers called the ban unnecessary and economically harmful.
The moratorium is now scheduled to run until Nov. 30.
Despite the ban, the report said most deepwater rigs have remained in the Gulf, drilling contractors have kept crews, and rig operators have made only minimal layoffs.
"Contrary to the worst-case assumptions in prior studies, many deepwater drilling operators and contractors have kept most of their employees on payroll," it said. "Earlier studies assumed that these employees would have been let go."
Small businesses were harder hit by the employment fallout than larger companies, the report said.
The report also found that delayed oil production -- what it called "the other primary economic consequence of the moratorium" -- was small compared to world production and not expected to have a "discernible effect" on oil prices.
"Consistent with other studies, we estimate that the moratorium will reduce Gulf of Mexico oil production by about 31,000 barrels per day in the fourth quarter of 2010 and by roughly 82,000 barrels per day in 2011," it said. (Editing by Bill Trott)