A Qantas plane made an emergency landing due to a "contained engine failure" Friday, soon after taking off from Sydney Airport, the carrier said in a statement.

The Qantas flight, QF520, was bound for Brisbane and was circling for a "short period of time" before landing safely at Sydney Airport, Qantas Chief Pilot Captain Richard Tobiano said in the statement.

"Qantas engineers have conducted a preliminary inspection of the engine and confirmed it was a contained engine failure," the airline said.

"While customers would have heard a loud bang, there was not an explosion."

A Sydney Airport spokesperson said it was not yet clear whether the plane's emergency landing and a grassfire on a nearby runway were linked, but investigations were ongoing.

The grassfire was brought under control by the Aviation Rescue Fire Fighting Service, the spokesperson said.

"With the safe arrival of the aircraft, Sydney Airport's priority is to conduct a full inspection of its parallel runway and to return it to service as quickly as possible," the spokesperson said.

Plane passenger Georgina Lewis told local outlet Channel Nine that she was onboard the flight.

"We were taking off, and we heard a bang. One of the engines appeared to have gone. The pilot came on 10 minutes later to explain that they had a problem with a right-hand engine on take-off," she said.

Tobiano of Qantas said his staff were "highly trained" to respond to such emergency situations.

"We understand this would have been a distressing experience for customers and we will be contacting all customers this afternoon to provide support," he said in the statement.

"We will also be conducting an investigation into what caused the engine issue," he added.

Customers were being moved to alternate flights, Qantas said.