Place a Dutch oven or other ovenproof pot over medium heat. Add the bacon and cook until lightly browned and most of the fat is rendered out. Remove pot from the heat. With a slotted spoon, transfer bacon to a medium bowl.
Preheat the oven to 300 degrees F. Add 1 Tbsp. of the oil to the bacon fat in the pot and set over medium-high heat. Season the lamb with salt and pepper. Sear lamb, cooking a few cubes at a time, until nicely browned. Remove cooked lamb from the pot and set on the bacon as you go along.
Add the onions and carrot to the pot and cook until lightly browned, about 2 minutes. Stir in the garlic, flour and tomato paste and cook 2 minutes more. While stirring, slow pour in 1/2 cup of the wine. Bring to a simmer and when the mixture is thick, slowly stir in the rest of the wine. Add the stock, herbes de Provence and bay leaf. Bring to simmer, and then mix the lamb and bacon back into pot.
Cover and cook the lamb in the oven 90 minutes. When almost there, heat the reaming 1 Tbsp. oil in a skillet set over medium-high. Add the mushrooms and cook until tender. Remove pan from the heat.
When the lamb has cooked 90 minutes, stir in the mushroom. Thin the stew with a bit more stock if you find it too thick. Cover and cook in the oven 15 to 30 minutes more, or until the lamb is very tender. Sprinkle servings of the lamb with the parsley.
Note: If lamb stew meat is unavailable, ask our meat department to cut some for you. Or, buy a lamb leg or shoulder roast and cut your own. Pearl onions, peeled and ready to use, are sold in our frozen foods section.