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KMG CHEMICALS FILES RESALE REGISTRATION COVERING A PORTION OF CHAIRMAN DAVID HATCHER’S SHARES

HOUSTON, TX – July 5, 2007– KMG Chemicals, Inc. (NASDAQ: KMGB), a global provider of specialty chemicals in carefully focused markets, today announced that it has filed a resale registration statement on Form S-3 with the U.S. Securities and Exchange Commission (“SEC”), pursuant to which David L. Hatcher, Chairman, may, from time to time, sell up to an aggregate of one million shares of KMG’s common stock, or approximately 24% of Mr. Hatcher’s stock in KMG. If or when Mr. Hatcher sells all of these shares, he would still own more than 3.1 million shares of KMG, or about 29% of the Company’s outstanding common stock.

Mr. Hatcher is registering these shares for resale to diversify his personal portfolio. John Sobchak, Chief Financial Officer, remarked, “A sale of these registered shares should broaden the Company’s shareholder base and increase trading liquidity.” The terms of any future sale would be established at the time of the sale.

A copy of the resale registration statement as filed with the SEC on Form S-3 may be obtained at the SEC's website at www.sec.gov, or through the Investors section of KMG’s website at www.kmgchemicals.com. Although the registration statement relating to these securities has been filed with the Securities and Exchange Commission, it has not yet become effective. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This announcement shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any State in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such State.

About KMG

KMG Chemicals, Inc., through its subsidiaries, produces and distributes specialty chemicals to carefully focused markets. The Company grows by acquiring and managing stable chemical product lines and businesses with established production processes. Its wholly owned subsidiary, KMG Bernuth, Inc. is a global provider of products to the wood treating and agricultural industries.

The information in this news release includes certain forward-looking statements that are based upon assumptions that in the future may prove not to have been accurate and are subject to significant risks and uncertainties. Although the Company believes that the expectations reflected in its forward-looking statements are reasonable, it can give no assurance that such expectations or any of its forward-looking statements will prove to be correct.

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Contacts: John V. Sobchak
Chief Financial Officer
KMG Chemicals, Inc.
713-988-9252 (x.114)
jsobchak@kmgchemicals.com

Investor Relations Counsel:
The Equity Group Inc.
Loren G. Mortman
212-836-9604
LMortman@equityny.com

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