B737-700 rejects takeoff due to compressor stall. Boroscope shows extensive internal damage.

Narrative

We were taking off when we had an extremely loud report from the left side of the aircraft somewhere between 110-115 KTS. This was accompanied by a pronounced airframe vibration and a bright orange flash. We rejected the takeoff and cleared the runway. We shut down the #1 engine and declared an emergency. The Fire Department arrived; checked out the aircraft; and cleared us to taxi to the gate. We decided to be towed to the gate. Because of the severity of the event; we were unsure what had occurred. We ultimately found out from Maintenance that we had experienced a compressor stall. I thought we either had severe engine damage or had collided with something on the runway. As we cleared the runway and stopped the aircraft; I expected to see a seized engine or some other significant indication of damage. We saw absolutely no abnormal indications. The #1 engine N1; N2; EGT; FF; were all normal. This led to our confusion as to exactly what had occurred. Neither the Fire Department nor our Maintenance could see anything visually wrong with the engine or any other part of the airplane. Maintenance later confirmed significant internal engine damage through a boroscope inspection. I would like to see some simulator training on compressor stalls. I had no idea that it could be such a severe event. I also didn't think it was possible that an engine could idle normally with significant damage to various compressor stages.