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(CNN) -- The view from above southern Egypt is stunning, a contrast of beige desert valley giving way to green farmland, including fields of sugar cane. Tourists soak in the sight by hiring hot air balloons that have large baskets to carry passengers hundreds of feet above the countryside.

Tuesday morning, as one of the balloons prepared to land, an explosion pierced the air, followed by a spreading billow of smoke.

"My first thought was that it was sugar cane that was burning," said Christopher Michel, a photographer who was a passenger in another balloon at the time.

Smoke from the burning sugar cane painted the ancient city of Luxor below with an eerie haziness.

But the concern shown by the balloon pilot and the blaring sirens from emergency vehicles told Michel that something was wrong. He could not imagine the extent: One of the balloons had exploded, and its 21 passengers and operators plummeted about 1,000 feet (300 meters) to the ground.

By Tuesday afternoon, the number of dead had climbed to 19, making it the world's deadliest hot air balloon accident in at least 20 years.

"This juxtaposition of this great beauty and this wonderful country and this horrible tragedy is just really shocking," Michel told CNN. "We all feel terrible."

It was an early, dark morning, Michel said, and uneventful for 45 minutes until they started to descend. He was overlooking mud-brick buildings and fields, with the Valley of the Kings in the distance, when the explosion shattered the quiet of the morning.

It was a gas explosion, state-run EgyNews reported.

Passengers in the balloon included 19 foreign tourists: nine from Hong Kong, four from Japan, three from Britain, two from France and one from Hungary, officials said.

An Egyptian pilot and another Egyptian also were on board, Luxor province spokesman Badawi al-Masri said.

Two people -- a Briton and the pilot -- are hospitalized.

Balloon rides offering panoramic aerial views of the Nile River and the ancient temples of Karnak and Hatshepsut are a popular tourist attraction in Luxor, about a nine-hour drive southeast of Cairo.

"You can see Valley of the Kings in the background bordered by farmland," Pauline Liang of Vancouver, Canada, told CNN's iReport last year. "Below were banana farms, and behind us was the city of Luxor. There was a great contrast between desert landscape, lush farmland and urban development."

Tuesday's crash prompted Gov. Izzat Saad of Luxor province to ban all hot air balloon flights until further notice.

Conflicting reports emerged about the company that operated the doomed balloon, Sky Cruise.

The head of the country's civil aviation authority said the company was licensed and working legally, EgyNews reported.

The agency has begun an investigation of the incident, Mohammed Ibrahim Sharif said.

According to Sharif, a fire broke out in the balloon while the workers were trying to land it, just feet from the ground. The balloon then shot upwards again, he said.

The balloon's basket was divided into four parts, he said, each holding five passengers.

Meanwhile, Luxor's chamber of tourism said the company had previous violations, EgyNews reported.

Several balloon companies had terminated contracts with the local meteorological service after the Egyptian revolution, Tharwat Agami, chairman of the chamber of tourism, said.

Sky Cruise and other companies were known to violate safety and security instructions by flying out of East Luxor, instead of the recommended West Luxor, he said.

Comparing it to a previous hot air balloon experience in another country, Michel noted that there was no safety briefing before the Luxor balloons lifted off the ground, but added that he felt safe during the trip.

From what he could tell, the doomed balloon was not overloaded, he said on his Twitter account.

Luxor is among Egypt's top tourist draws. Visitors go to see ancient temples and tombs, and travel sites often recommend the hot air balloon trips.

The last hot air balloon accident in Luxor occurred in 2009, when 16 foreign tourists were injured after a balloon struck a cell phone transmission tower.

Until Tuesday's incident, the deadliest accident in recent memory took place in 1989, when 13 people were killed as two hot air balloons collided in Australia.

Egyptian government spokesman Alaa Hadidi announced that the Cabinet will form a committee from the Ministry of Civil Aviation to investigate Tuesday's accident, EgyNews said.

CNN's Housam Ahmed and Hamdi Alkhshali, along with journalist Adam Makary in Cairo, contributed to this report.