I'm not a pro gunsmith,but I have been around long enough to tell you NOT to shoot that gun with barrel in that condition,the metal is stressed and it could come aprt causing injury to you or someone near by .....Being an SKB,(I own an SKB 900xl 20 ga auto,imported by Ithaca in 1977 I believe) 20+ years ago....
You'll probably need to find a new set of barrels for this shotgun....your looking for a donor shot gun ,check the web ,you may fins just what your looking for !
Do you have any idea what caused the bulge? what was the obstruction ???