Abstract: Hydrocarbon generation is chemical balance and organic matter in rock generates oil or gas. Since the density of oil and gas is lower than kerogen, the reaction is a kind of classic chemical reaction with volume increase. Different from open system in laboratory, hydrocarbon generation reaction under earth equals activation energy plus draining hydrocarbon energy. The density of mature rock is quite dense and its draining hydrocarbon energy is quite high comparing with open system, it makes under generation. Structure movement forms fracture net, and draining hydrocarbon energy is decreasing greatly, which makes under generation organic matter generate a lot of oil and gas in short time and it is named as Tectonic Generation by the author. Mature rock is more compact and its draining hydrocarbon energy is higher generally. More under generation organic matter become material base of shale gas. Over mature compact rock contains plenty of organic matter. Classic generation theory insists that generation ends basically while R_o is over 2.0. But plenty of shale gas found in formation with R_o 3.0, even with R_o 4.0, it proves the existing of under generation. The smaller the molecule is, the lower the draining hydrocarbon energy is. Much organic matters in the rock generate shale gas, so potential of shale gas is huge. Since the developing rate of shale gas is several orders of magnitude higher than draining hydrocarbon rate in nature, gas draining is fast and it benefits the chemical balance to generating gas. Exploration proves that shale gas quantity in direct proportion to TOC, which shows that free gas, absorbed gas and organic matters forms chemical balance in shale. While free gas pressure increases, absorbed gas desorbs, and organic matter generates gas. Some over mature rock have under-low mature T_max. The low mature T_max shows that organic matters become potential resources after fracturing and draining hydrocarbon energy decreases to meet the reaction condition. Shale gas development is much more complex than ordinary gas.