** Shares of oil and gas explorer Carnarvon Energy CVN.AX rise 4.6% to A$0.115

** Co proposing to potentially return up to A$0.07 per share to shareholders

** Co intends to retain at least A$62 million ($39.22 million) in cash following the capital return

** Stock rose as much as 9.1% earlier in the session

** 3.9 million shares change hands, vs the 30-day average of 1.3 mln shares

** Stock down 26.7% this year, as of last close

($1 = 1.5808 Australian dollars)

(Reporting by John Biju in Bengaluru)

((John.Biju@thomsonreuters.com;))