Domestic Natural Gas Supply Act of 2006 - Instructs the Secretary of Energy to incorporate into the annual plan for the ultra-deepwater and unconventional onshore natural gas and other petroleum research and development program the goal of achieving a cumulative increase of 8.5 trillion cubic feet in domestic production of natural gas by 2015.
Amends the Energy Policy Act of 2005 to require that all excess federal royalties derived from federal onshore and offshore oil and gas leases up to $200 million be deposited into the Ultra-Deepwater and Unconventional Natural Gas and Other Petroleum Research Fund.
Defines excess federal royalties as the amount calculated on the basis of the difference between the prevailing market prices upon which the royalty payment was made and 110 % of the assumed market prices contained in specified economic assumptions.