Most shareholders aren’t.  After the failure of Top Kill, many are heading for the exit but CEO Tony Hayward is doing his best to restore confidence:

Telegraph: One clear message Hayward intends to make to shareholders is that the dividend is safe, with the company enjoying a $6bn-$8bn cash flow buffer even after maintaining the dividend and meeting capital expenditure commitments.

But to really sway the markets he needs to put the likely cost of this disaster in some kind of context. That will be hard given how fast this situation is moving. But clearly Hayward has in mind a possible containment and clean-up bill of up to $3bn, with damages on top of that. This would amount to just half of BP’s first-quarter cash flow of $7bn. It also has $14bn of unused borrowing facilities.

He has given an cost estimate for the clean up, at $4 billion, which doesn’t appear to include the massive potential legal liabilities. The Wall Street Journal has tried to estimate BP’s overall costs if it has to compensate for economic damage on top:

WSJ: Before this, the worst oil disaster in history was the Exxon Valdez spill of 1989. As noted here previously, Exxon ended up paying about $7 billion in today’s money as a result. Will this disaster end up costing nine times as much as Valdez, in inflation-adjusted terms?

One major difference is the impact on local economies. The fisheries of the Louisiana and Mississippi coasts have been devastated. So too, for some time, has some of the local tourist business. But how big are they?

Forest, fishing, and related activities for Louisiana and Mississippi could be $1.2 billion per year.

Arts, entertainment, and recreation for Louisiana and Mississippi potential liability – $1.9 billion per year for damage on this front.

Tourism for the two states is $9 billion a year. The WSJ reasons that if perhaps half is decimated the cost here could be $4.5 billion.

That’s $7.6 billion so far.

Assuming additional costs from fines, cleanup etc double those related to Exxon Valdez, that would be another $14 billion.

Still way less than the $66 billion total cost of the spill envisaged by the fall in BP and others’ market value. The WSJ notes that shares of all companies related to the Deepwater disaster (BP (BP), Transocean (RIG), Anadarko (APC), Halliburton (HAL,) Cameron (CAM))  had fallen a collective $66 billion since April 20th, as of June 1st adjusted for general falls in the stock market.

Finally, the Independent reports an estimate of maximum damage for the disaster at $25 billion, assuming that Florida is not hit in a significant fashion.

With market reaction looking like overkill, there is speculation that BP could become a takeover target. Individuals feeling bullish will need to attach their most solid steel pair.