During a scheduled transit stop, the number 1 engine (CF6-50E2) of the Boeing 747-2F6B required three engine starts for the rectification of a minor oil leak and troubleshooting of other defects before the aircraft was subsequently released for service. Soon after departure from Sydney-Kingsford Smith International Airport, Australia, whilst climbing through 8,500 ft at 263 kts, the pilot in command noticed that the number 1 engine start valve OPEN light was illuminated and he requested the engine shutdown checklist. Almost immediately, whilst disconnecting the auto-throttle, there was a bang, a slight yaw to the left and vibration for a very brief duration. During the engine shutdown sequence, the engine fire detection light on the centre panel illuminated momentarily. After securing the engine, 30 tonnes of fuel was jettisoned before the aircraft returned to Sydney for an uneventful landing. Inspection on the ground revealed that only the top sections of the fan cowls, containing the hinge fittings, remained on the number 1 engine. The forward section of the pylon, and the wing leading edge outboard of the pylon, were holed and dented. The paint on the starter case was blistered and there were detached turbine blades in the starter exit screen. SIGNIFICANT FACTORS 1. A fuel leak occurred from a loose connection in the environmental drain system of the number 1 engine which pooled in the area above the starter. 2. The fuel evaporated to form an explosive mixture in a contained, unvented area within the fan cowls during flight. 3. The engine start valve opened, uncommanded, in flight. 4. The starter oversped and disintegrated, having no engine load to contain its speed. 5. The hot liberated debris from the starter ignited the explosive fuel-air mixture. 6. The subsequent explosive force deformed the cowlings into the high speed airstream, resulting in overload failure of the cowl latches and loss of the cowl panels.