Lance Hopping's terrified balloon passengers struggled desperately to push themselves away from overhead powerlines as the balloon's basket slid beneath them and caught fire.
Two passengers leapt from the burning basket before one of the powerlines, lying across the top of it, broke. The balloon shot 150 metres into the air, then collapsed in flames, an interim report into the January 7 crash in Carterton reveals.
All 11 people on the flight, including pilot Mr Hopping and the two who jumped, were killed.
The report, by the Transport Accident Investigation Commission, also reveals that blood and urine taken from Mr Hopping's body four days after the crash tested positive for cannabis.
It does not disclose what level of cannabis was found, or whether it contributed to the crash.
The balloon skirted powerlines for up to seven horrifying minutes before becoming caught under the wires, at times travelling as low as 5 metres above the ground.
After taking off at 6.38am, the balloon ascended to 450 metres and drifted slowly southeast before moving back to the north.
While the ground crew parked up just north of Carterton to wait, the balloon continued to slowly travel north then east for the next 30 minutes.
As it prepared to land, the balloon descended to within 5m of the ground, near buildings and paddock sprinklers, as relatives of some of the victims reported noticing an "isolated gust of wind".
The balloon then veered sharply toward the lines, and Mr Hopping was heard yelling "Duck down" to passengers before the balloon rose into the wires and became stuck.
By this stage, it had been travelling parallel to the powerlines for up to 7 minutes, TAIC investigator in charge Ian McClelland said.
As passengers tried to push away and the basket slid beneath the lines, electrical arcing occurred, igniting the lower basket.
Balloon Aviation Association president Martyn Stacey said after the release of the report that flying near powerlines was discouraged. "My personal view is that powerlines frighten the hell out of me ... but clearly Lance had seen them and knew where they were."
The question remained why Mr Hopping did not use his balloon's emergency deflation device, he said. "I would like to think I would have pulled out way before then, but obviously he didn't make that decision and something has suddenly happened."
The report contains no analysis of the crash facts, nor any recommendations. Those would be reserved for the final report due next March, a TAIC spokesman said.