Since he first set foot on a tanker as a cadet in 1998, the ocean has been Cheah Sin Bi’s office. So it’s no surprise that now as CEO at shipping company Orkim, he’s using his executive influence to do all he can to protect it.
“Everything is now about the environment,” he tells The CEO Magazine.
The Malaysian ship-owning company is a major player in the energy transportation sector with an impressive client list that includes PETRONAS, Shell, Petron, BHPetrol and Nippon Gas Line.
As the market leader, we want to have the first dual-fuel tanker in Malaysia.
Cheah no longer sees the transition to greener energies as a choice but rather a pressing obligation.
“It’s no longer an option for us whether we do it or not,” he stresses. “As the market leader, we want to have the first dual-fuel tanker in Malaysia.”
The company is now investigating methanol and liquefied natural gas dual-fuel tankers, and while the technology is still nascent, with many engine manufacturers still at proof-of-concept stage, Orkim has adopted a proactive approach.
“We have actually engaged shipyards in China, Korea and Japan to conduct studies,” he says.
Cheah’s clear vision is in stark contrast to the general climate of uncertainty in the tanker market, with orders for new tankers significantly down on the previous decade.
While the demand is there, he attributes much of this reticence to the owners and operators who are still waiting for clarity on what type of engine they should invest in, knowing that key dates, such as the Global Energy Sector net zero target by 2050 (and a 40 percent reduction in fossil fuel use by 2030) are well within any newbuild vessel’s life span.
The 2050 target is a major marker in Cheah’s strategic vision for Orkim, which is centered around a number of key pillars, the first being fleet replacement.
“We definitely want to lower the age of our fleet,” he reveals, adding that the average age of its fleet is currently hovering around the 8.8 year mark – a figure well below the regional average of 10 years.
His ambitions are off to a flying start and Orkim’s proactiveness is paying dividends. The company has already managed to secure two shipyard slots for new dual-fuel tankers, meaning Cheah is on track to fulfill his ambition to launch the first dual-fuel tanker in Malaysia.
Sea of opportunity
This is fitting news as the company prepares to celebrate its 20th anniversary next year. Founded by Wan Izani and Captain Khoo as a shipbroker in 2004, Orkim’s growth story is impressive. By 2007, it had become both a shipbroker and a ship-owner, with its first clean petroleum product (CPP) tanker delivered in 2009 followed by five more in 2010.
That same year, Orkim won its first Consecutive Voyage Charter (CVC) contract with Shell and a contract with PETRONAS came in 2011. Today, Orkim is one of the largest CPP tanker companies in Malaysia with a fleet of 18 oil and liquefied petroleum gas tankers.
Cheah joined the company in 2012 and has progressed through the ranks from Department Head and General Manager roles to COO in 2018. He was appointed CEO in August 2021.
Along with the shift to cleaner fuels, another core pillar of his leadership is diversification.
“We want to ship anything liquid,” he says, adding that the ideal tanker is one that is flexible and equipped to carry both oil and gas products and chemicals.
“We are looking very closely into the chemical tanker market and have shortlisted about five tankers.”
We have the highest number of master mariners and former chief engineers in our team, and we make safety and operational excellence a priority.
For Cheah, diversification has a geographical slant as well; he has been looking toward different countries for growth. His aims have been given a boost by the recently announced partnership with Shell Philippines, a deal that sees one of its ships permanently placed in the country’s waters.
“This makes us one of the first foreign owner–operators in the Philippines domestic market, so we are doing quite well,” he explains.
A spot shipment with PTT, Thailand’s state-owned oil and gas company, is cause for further enthusiasm.
“Moving forward, we see plenty of opportunities in Vietnam and Thailand too.”
Integrity and transparency
Of course, such plans will have a trickle-down impact on Orkim’s operations. Cheah is acutely aware that it is one thing to transition to dual-fuel tankers, but it’s another to ensure he has the right crew with the right skill set to operate them. Fortunately, he believes the company has a head start on its competitors.
“Our key strength, and what distinguishes us from other operators in this market, is our very strong team,” he points out.
“We have the highest number of master mariners and former chief engineers in our team, and we make safety and operational excellence a priority.”
For the past seven consecutive years, Orkim has been recognized with numerous industry awards, including Shell Master’s Awards’ ‘Best Ship Owner’ and ‘Best Vessel’.
“That shows the integrity of our operation and how transparent and engaged we are with our clients,” he says.
This engagement includes a monthly check-in with its charter clients.
“We look at what worked and didn’t work, and we highlight the operational deficiencies or difficulties and how we are working to correct them,” he explains. “We want to show our clients that we are always striving to improve.”
An overall solution
Open lines of communication are just one facet of the transparent value add that Orkim brings to its client relations.
“We are also integrating technologies such as digitalization to allow the client to follow their cargo in real time, for example,” Cheah confirms.
What turns single clients into clients that sign CVC and other long-term contracts, however, is a level of service unlike any in the region.
“Unlike many ocean-going companies, where your contract is purely based on A-to-B delivery, for us it is very much about the overall solution,” he confirms.
We know how to make our clients’ operations faster, more efficient and safer.
It is this commitment to client service and its extensive local knowledge that has made Orkim the market leader in Malaysia.
“We are the experts in the region, we know the regulations and we actually have the people who can undertake the requested operations,” he says.
As the business expands its footprint into the Philippines and beyond into Thailand, Indonesia and Vietnam, the same recipe for success applies.
“We know how to make our clients’ operations faster, more efficient and safer,” he adds.
A picture of health
As Cheah steers Orkim toward a green future, it helps that the company is currently in the best shape of its life.
“We have almost half of the market share,” he reveals. “Last year was the highest in terms of revenue and EBITDA in the past 10 years. We continue to grow at a compound annual growth rate of 10 percent and our EBITDA margin is always above 40 percent.”
The good news doesn’t end there. “Our utilization rate continues to hover around the 90 percent mark and, at present, all our ships are contracted.”
Such a picture of health is made possible by strong strategic supplier relationships with partners such as Malaysia’s State Insurance Brokers. Another important group of suppliers are the engine and spare parts contractors who are on hand when engines, generators or turbochargers need to be overhauled and serviced, such as Srikanda Marine and Turbo Gemilang.
It’s these partnerships that allow Orkim’s vessels to return to the water and safely deliver clients’ products as quickly as possible.
Like any executive in his industry, safety is always front of mind for Cheah. Among his external commitments, he’s currently a Focus Group member of Shell Partners in Safety, which has a core focus to improve the health and safety culture in the maritime industry, or in Cheah’s words, “to empower and care for people”.
Leading by example
It’s a similar philosophy that he carries over to Orkim’s culture.
In the past three years, the company has implemented the five principles of human performance, as laid out in the book of the same name authored by Todd Conklin, Senior Advisor for Organizational and Safety Culture at Los Alamos National Laboratory.
“Everybody makes mistakes – that’s how you learn. It’s how you respond to failure that matters and actually drives the behavior of people toward success of the company going forward,” he explains.
“We really want to have this learner mindset in our organization, in our staff, in our group, because blame culture stops us from learning. When you have issues or failures, that actually becomes an opportunity to learn to prevent the same situation arising in the future.”
He recognizes that it’s up to him and his management team as leaders to set the example.
Everybody makes mistakes – that’s how you learn. It’s how you respond to failure that matters.
“People behave in a certain way following the context that we lead with,” he reflects. “So if you set the right context in your organization, that will drive your people to do the right thing.”
Cheah describes his leadership style as very results oriented.
“We have a good business plan, we have good KPIs and we have our monthly target,” he says. “I engage with my team regularly, and people are empowered to make decisions and are similarly very disciplined.”
He adds that, at present, Orkim is on track with all its projections and forecasts.
Under Cheah’s stewardship, the business is also on track to a greener future: an example of a company doing the right thing for others in the industry to follow.
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“Orkim’s commitment in fostering a strong partnership through unwavering trust and effective communication has created mutually beneficial and enduring collaboration opportunities in the highly volatile shipping industry. IMSE is dedicated to work toward shared long-term goals.” – Lee Siing Hung, Managing Director, IMSE Utama