I have found that animation loops without LUA scripting, all that was required was anim info in the .fpe. Boned and vertex animations both run, with issues only with vertex anims which tend to be real slow.
I too tried to use scripting to run these without success but it's early days and still trying to get to grips with LUA
I can only assume your script is playing the animation once then ends, perhaps you need to find a way to either loop the script or a function to loop the anim once it's triggered. It will play looped in the editor if: playanimineditor = 1 regardless of any scripting.
I have been testing out some destructible buildings, roads etc and your script will likely be what I am looking for to get a start since I was wanting play and stop, I will try it out later
Still till we get decal,videotextures or at least explosions of some sort and a way to trigger these scripted as well then it's all a long way off.