SYDNEY (Reuters) -A Qantas Airways flight bound for Brisbane suffered an engine failure after take-off on Friday and circled for a short period of time before returning safely to Sydney Airport, the Australian airline said.

Passengers heard a loud bang from one of the aircraft's two engines, Australian media reported.

A journalist with national broadcaster ABC was on the flight and said there was a "sharp shudder" on the plane after the loud noise, his news outlet reported.

"It was apparent something had happened with one of the engines, then the plane seemed to labour to get off the ground or get any altitude," ABC journalist Mark Willacy said.

Qantas said its engineers had conducted a preliminary inspection of the engine and confirmed it was a contained engine failure, meaning the internal engine parts stayed within the protective housing designed to keep them safely enclosed.

Uncontained engine failures, where engine fragments fly out of this housing, can result in serious damage to the main body of an aircraft.

Qantas flight QF520 took off from Sydney at 12:35 p.m. (0135 GMT), circled a few times and diverted to land at Sydney, tracking data from Flightradar24 showed.

The aircraft's departure coincided with a grass fire breaking out alongside Sydney Airport's parallel runway that was brought under control by teams from the aviation firefighting rescue service, the airport said in a statement.

"It's not clear at this stage if the two incidents are linked and investigations are continuing," the airport added.

Qantas said the plane landed safely after appropriate procedures were conducted and added it would be investigating the cause of the engine issue.

The plane is a 19-year-old Boeing 737-800, according to Flightradar24. That model is powered by engines from CFM International, a joint venture between GE Aerospace and France's Safran.

Twin-engine passenger planes of this sort are designed to be able to be flown on one engine in an emergency.

"We understand this would have been a distressing experience for customers and we will be contacting all customers this afternoon to provide support," Qantas Chief Pilot Captain Richard Tobiano said in a statement.

Sydney Airport said its main runway is operational, but passengers should expect some delays.

On Friday morning, a technical outage crippled all of Australia's major airports, leading to long queues at international terminals after the disruption of automated kiosks for identity and facial recognition, authorities said. The issue was resolved by midday, according to the Australian Border Force.