Nice pic's!
Doubt it happened solely due to loose lugs, looks like total lack of proper OCP.
"This was hooked up to a 1200 amp 3-phase transformer, via 600 amp fuses. I believe the panel was a 250 amp panel in happier days..."
Maybe those 600A fuses were on the primary side? Or, no AIC calcs and breakers just exploded due to a simple short?
