A barge burst into flames after a firework exploded, sending some spectators ducking for cover, during Canberra's annual fireworks event Skyfire on Saturday night.

Key points: Foti International Fireworks said it was investigating the cause of the malfunction

Foti International Fireworks said it was investigating the cause of the malfunction No-one was injured in the incident

No-one was injured in the incident Spectators said embers landed on the shoreline as a result of the error

The incident is being blamed on a malfunction with one firework which was immediately disabled, damaging the barge on which it stood.

Some in the crowd said they thought they saw fireworks flying towards them, but organisers said only embers landed on the grass near where the fireworks were being launched.

Footage recorded at the time shows some people running away from the blast, while others can be heard screaming.

Radio station Hit 104.7, which organised the event at the edge of Lake Burley Griffin, confirmed one firework had malfunctioned after the show began at 8:30pm, causing some embers to land on the nearby shoreline.

No-one was injured, including the pyrotechnic team member who "followed procedure" and turned off the malfunctioning firework straight away, Hit 104.7 said.

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Erinn Stanford, who was sitting on the shoreline with her partner and two children, aged 8 and 6, to watch the show, said they were left shaken and scared after the incident.

"It's just not worth sitting that close anymore when you have kids," Ms Stanford said.

"We were right on the lake's edge."

She said in the initial panic of not knowing what was happening, the couple moved to throw their picnic blanket over the family of four to shield them from the embers.

"Suddenly there was an explosion, but it wasn't so much that as when suddenly the fireworks came towards [us]," she said.

"Everyone ducked for cover.

"Obviously, the kids, especially our youngest, was really shaken up and traumatised. The two boys and I got up to run, along with a lot of other people."

She said, with the incident happening just one day after the terrorist attack in Christchurch that left 50 people dead, she had been concerned the explosion was more serious than an error.

"I wanted to just leave, but my partner wanted us to stay," she said.

"It was more to make sure the kids weren't scared, even though they were … to try and normalise it.

"For me personally is was because it was the day after the shootings in New Zealand — everyone was quite on edge."

'Haven't seen anything like it': fireworks company

The barge was taken away by ACT Water Police, and it remained cordoned off on Sunday morning. ( ABC News: Marco Catalano )

Fortunato Foti of Foti International Fireworks, the company contracted to run the show, said they were investigating the cause of the incident.

"I've been doing this for 35 years and I haven't seen anything like it before," Mr Foti told the ABC.

Each firework was controlled by a key that could be switched off to ensure the malfunction did not continue, Mr Foti said.

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"The operator, as per our protocol, has isolated that barge and keyed off and it didn't run for the last 14 minutes [of the display].

"Thankfully no-one was hurt, so we're doing our own internal investigation, and [will] see what the possible cause was and inform the authorities accordingly."

Some in the crowd assumed the malfunction was part of the fireworks display, but social media videos show many were immediately concerned about the blast.

It was initially unclear if anyone on the barge or close to the fireworks was harmed.

In its statement, posted to Facebook after the incident, Hit 104.7 said no-one was injured as a result of the malfunction.

"We can advise that one firework did malfunction, and while a small number of embers were reported to have landed along the nearby shoreline, no members of the public were injured," it said.

"The malfunction resulted in the barge being isolated before the pyrotechnic team member in attendance, who is fine, followed procedure."

ACT Policing told the ABC they were not investigating the matter and emergency services who were present at the time were not required.