(Updates with remains of one passenger found, state police conference)
By Eric M. Johnson
May 10 (Reuters) - At least one person died and two were missing after a hot air balloon hit a power line and caught fire over Virginia during a festival, police said on Saturday.
Authorities said they had found the remains of one person, and were continuing to search for the others missing after the Friday evening accident 30 miles (48 km) north of Richmond.
Witnesses posted photos online showing a balloon in mid-air with its basket engulfed in flames and a trail of smoke spilling into the sky.
One local described hearing people calling for help from the basket.
"They were just screaming for anybody to help them," resident Carrie Hager-Bradley told a local NBC affiliate.
The balloon, holding a pilot and two passengers, was one of three aloft at the time as part of the Mid-Atlantic Balloon Festival, said officials.
Resident Debra Ferguson told a local newspaper she looked up after other balloons had landed safely near her house and heard cries of "Oh my God" and then saw a surge of flames.
"As soon as we looked up, the thing blew up right there ... it was like a match, poof, and then it was gone," Ferguson told the Free Lance-Star of Fredericksburg.
Witnesses said there was an explosion as it hit the line and the balloon then separated from the basket carrying the passengers, Virginia State Police spokeswoman Corrine Geller told a televised news conference.
She did not identify the person who had been found and said the other two balloons landed safely.
The accident occurred 7:30 p.m. (2300 GMT) said Federal Aviation Administration spokeswoman Kathleen Bergen.
The balloon crashed near a park as the festival was hosting a special "Friday Flights Happy Hour", organizers said.
More than 20 hot air balloon teams from across the United States were to take part at The Meadow Event Park in Caroline County. The Saturday and Sunday events were canceled. (Reporting by Eric M. Johnson and Doina Chiacu; Editing by Andrew Heavens)