Looks like sponge to me as well, and quite an invasive one at that. If you're upgrading and can relocate your livestock temporarily, you might consider removing the infested rock, taking off what you can by hand, and then leaving it exposed to the air for a bit. If it's a sponge, it should die. You'd then need to re-cure the rock, and/or 'cook' it, and it will STINK -- nothing smells so awful as dead sponge -- but it should get rid of the problem. If you'll be curing a lot of new rock anyway, it might be worth considering.