The hot-air balloon plunges from the sky. Two women were killed in the tragedy. ((Cheryl Birch/CBC))

A fuel line that became dislodged from a propane tank led to the flaming crash of a hot-air balloon in Surrey, B.C., in August 2007, killing two passengers, the CBC has learned.

However, investigators with the Transportation Safety Board of Canada weren't able to determine how the line became detached, a source told CBC News on Monday. The TSB is set to release its report on the accident on Tuesday.

The basket of the balloon, operated by Fantasy Balloon Charters, caught fire just before liftoff, and some of its 12 passengers were able to scramble to safety before the balloon began to rise, snapping its ground tether. With the basket engulfed in flames, the balloon rose high into the sky and then plummeted to the ground in a nearby RV park.

Shannon Knackstedt, 49, and her daughter Gemma, 21, both from Langley, B.C., were killed in the calamity, while several other people were taken to hospital with burns and broken bones.


Debris from the crash was studied for clues by investigators from the Transportation Safety Board. ((Jeremy Nuttall/CBC))

The report says there was no emergency fuel shut-off on the tanks, and it's recommending all hot-air balloons be equipped with them in the future, the source said. The source added that the findings are also extremely critical of Transport Canada, saying there is a lack of regulatory oversight in the hot-air balloon industry.

The board came up with the same findings in the case of a balloon crash in Winnipeg that also occurred in August 2007.