Slurtle Slime is a useful non-spoling item used to refuel Lanterns or Miner Hats and cause Earthquakes in caves. It's dropped mainly by Slurtles and Snurtles when they eat Rocks, Flint, Gold etc.
To farm it, you have to explore the caves and find one or more Slurtle Mounds grouped together, preferably under a light shaft. Once you do that, wall the mound(s) to prevent the Slurtles or Snurtles from wandering off, then build a Chest and place it near the mound(s). Fill the chest with excessive Rocks or other minerals. When the slugs come out and there are no minerals in the ground they will aim for the chest. They will start biting the chest and make the minerals bounce out, then after enough of them are on the ground they'll start eating them and produce slime in the process.

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Slurtle Slime is a Mob-dropped item. It is produced by Slurtles and Snurtles after eating Rocks, and also dropped when they are killed. It is very explosive, and can trigger earthquakes when ignited. It deals 50 damage per charge (It can be exploded in stacks). It can be a very good alternative to gunpowder and can be easily farmed by feeding Slurtles. Additionally, it can be used to refuel a Lantern or a Miner Hat by 9.5%.
This item may be explosive because Slurtles and Snurtles consume nitre, an ingredient for high explosives like Gunpowder.
When the player becomes insane, Slurtle Slime will appear to be grayish blue.

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With this technique you'll ensure that all the slime is in one place and not scattered around the area of the mound and the walls will keep the slugs from eating minerals you don't want them to eat (either wall them against the border of the map where there's a little space you can cross but they can't, or place a Hay Wall that can easily be destroyed and replaced anytime you want to enter or exit.)