Abu Dhabi’s International Petroleum Investment (IPIC) and Mubadala Development Company will be consolidated in a bid to save costs.

Sheikh Mohamed bin Zayed, Crown Prince of Abu Dhabi, issued a resolution to merge the two sovereign wealth funds.

This follows the proposed merger of two of Abu Dhabi’s largest banks, National Bank of Abu Dhabi and First Gulf Bank.

A joint committee will be created to manage the Ipic Mubadala merger. The two companies will operate independently until the joint committee completes its work.

The merged entity is expected contribute more significantly to economic diversification.

“Integrating the two entities would create greater benefits and enhanced economic value to the Government of Abu Dhabi. The combined entity will realise synergies and growth in multiple sectors including the energy and utilities sector, technology, aerospace, industry, health care, real estate and financial investments,” reads the public statement.

Ipic is working on a $14bn of hydrocarbons storage, refining and petrochemicals projects in the UAE and wider Middle East. Progress on the projects has been slow for the last year.

They include Fujairah Refinery, Duqm Refinery in Oman, and Emirates LNG, in joint venture with Mubadala.

Mubadala manages a $67.1bn global portfolio in aerospace, hydrocarbons, metals & mining, defense, information technology, health, real estate, infrastructure and utilities. Its subsidiaries include Aldar Properties, Strata, Dunia Finance, Dolphin Energy, Mubadala Petroleum, Emirates Global Aluminium and Tabreed.

Green energy company Masdar is a subsidiary of Mubadala. It was recently selected to carry out an 800MW solar project in Dubai.