(require 'compile)

(pushnew
 '(mercurial-test-output-tb
   "\+  File \".*/install/lib/python/\\([^\"]*\\)\", line \\([0-9]*\\), in .*$"
    1 2) compilation-error-regexp-alist-alist)
;; add to the end so this gets priority
(setq compilation-error-regexp-alist
      (append compilation-error-regexp-alist '(mercurial-test-output-tb)))

;; Use the next s-exp to remove the last list element if you need to
;; live-edit this regex
;; (setq compilation-error-regexp-alist-alist
;;         (cdr compilation-error-regexp-alist-alist))
;; (setq compilation-error-regexp-alist
;;         (reverse (cdr (reverse compilation-error-regexp-alist))))