Hyper-expansion in the development of Canada’s oil sands and shale gas seems to be one of many answers to the flagging fortunes of E&P companies. The North American shale gas market looks irresistible with Sasol (NYSE: SSL) announcing its second shale gas acquisition in three months. The $1.08 billion deal for a 50% stake in Cypress A acreage from Talisman Energy (NYSE: TLM) follows another $1.08 billion deal to acquire 50% of Talisman's Farrell Creek operations.

Sasol, the world's largest motor fuels producer from coal and gas, has not been in an enviable position since reporting a year-over-year drop in revenue in 2010. Much of this can be attributed to the dramatic fall in energy prices following the super-spike in 2008. However, the company has been getting back on track by making some of these strategic acquisitions, and in the interim period, its finances are nothing to sneeze at.

The finances
The company posted a phenomenal jump in net income for the 12-month period ending Dec. 31, 2010. In other words, the company has a clear and indisputable ability to turn revenue into solid profits.

The total debt-to-equity ratio stands at 16%, which is again quite healthy, meaning the burden of debt sits lightly on management's shoulder. Also, the return on equity stands at 18.9%, implying that the company has the ability to provide good returns to its shareholders. Any value above 15% is Foolishly positive.

Another factor that shows the sign of a healthy balance sheet is the current ratio. This metric shows whether the company has enough liquidity to meet its working capital requirements to carry out its daily operations. This stands at a healthy 2.4 times.

In the long run
Following the two acquisitions, Sasol will have an additional 10.4 trillion cubic feet of gas reserves. Also, employing one of the most advanced technologies to convert gas into motor fuels, the entry into Canada's shale gas play signals good fortunes ahead.

Overall, I believe this is a good stock to invest in. The company is working hard by exploiting resources in diverse regions. Of course there will be teething issues as production begins from these places, yet, in long run, this will bode well for the company and its shareholders.

Isac Simon does not own shares of any of the companies mentioned in this article. Sasol is a Motley Fool Income Investor recommendation. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.