Freight train explodes and devastates city in Canada.

LAC-MEGANTIC, Quebec, July 6 (Reuters) - An out-of-control freight train carrying oil tankers derailed at high speed and exploded Saturday morning, creating a massive fireball in the middle of a small Canadian town, destroying dozens of buildings and leaving an unknown number of people possibly missing.

The disaster occurred shortly after 1:00 AM (local time) when the 73-car train entered Lac-Megantic, a picturesque town of about 6 inhabitants near the border with Maine, USA, and derailed. Witnesses said the town center was crowded at the time.

Four of the pressurized tank cars caught fire and exploded, forming a mushroom-shaped fireball hundreds of meters above the ground.

Although police said they were not yet close enough to determine the number of victims of the fire, an aerial photograph showed widespread devastation in the city center. Police also reported that some citizens expressed concern about being unable to contact family or friends by phone.

"I can't say anything at all about victims... We've been informed about people not answering their phones, but you have to understand that there are people who are out of town and on vacation," said police spokesman Michel Brunet.

An official from Montreal, Maine & Atlantic, the company that operates the train, said the vehicle was parked some distance from the city and had no one on board when it derailed.

"We don't know for sure what happened, but the engineer did everything right. He had parked the train and was waiting for its release... somehow, the train came loose," Joseph R. McGonigle, vice president of marketing, told Reuters. "There appears to have been significant damage to the buildings, but we don't have complete reports of injuries yet. We understand there are probably some," he said.

The tracks pass near a bar popular with young people. Eyewitness Yvon Rosa said he had just left the bar when he saw the train speeding towards him.

Residents told reporters they heard five or six large explosions. Nearly 12 hours after the derailment, one carriage was still ablaze.

Five officials said they feared more tanks were at risk of exploding. Around 30 buildings in the city center were destroyed, some by the initial explosion and others by the subsequent fire, they reported.

Police established a 1 km cordon around the site of the explosion and evacuated about a thousand people from their homes.

Canadian Prime Minister Stephen Harper made an initial statement on Twitter: "Thoughts and prayers with those affected in Lac Megantic. Horrible news."

(By Mathieu Belanger)