I don't think stone above the mantle is even an option for this wall. Too many things going on.

I would spend the money to raise the niche for the bar area to align with the doorway so something looks consistent.

I'd find a different location for the TV. The space is too small.

Is that the only option for the TV?

I don’t think the style or design plan that you have in mind is going to work well on that wall. Your current fireplace might be ”old” - but it is quaint, and does have style; and it works on that wall, and with the style of your house better than what you are intending. Also, going through this fireplace remodel, in order to hang a tv on/over the structure, is imo going to be a waste of money - for any number of reasons - including the fact that the wall is just too small for what you are planning.

Unless your fireplace directly and immediately faces the front door of your house - placing a mirror over the current fireplace would have many benefits.

I did these with AI to show general idea:

And you could use an electric log kit. You can use any mirror you like; but if you want to spend money, you could get a beautiful vintage mirror - such as La Barge, for example. Just don’t use any mirror that distorts or fragments images - such as those window pane type mirrors, etc.

Money expenditure #2: A tv lift cabinet - to be placed somewhere else in the room. You could put it in front of windows if necessary.

https://m.youtube.com/watch?v=ogIlWb24G_A

ETA: You can buy a tv lift cabinet, have one custom made, or modify an existing cabinet. Amazon sells the lift mechanism.

Typically, the surround will end at the mantel. Do you plan on having one?

IMO an odd place for a FP I would remove the old and no have one there at all If this is the only place for TV a shallow cabinet low enough to have TV at proper viewing height and no FP at all

Beverly that door height always bothered me. Didn’t think of it for this project but definitely will.
This is the only wall option for us.
Thank you!

With the fireplace located between two doorways and wanting your TV above this is what I would do...

What are the two black grills above the fireplace? Are they related to the home HVAC or just the fireplace?

I support doing so to de-emphasise the varied door /opening heights. There are a few options.

@lisedv nice rendering to show everyone what the OP envisions. @Kate grab that photo and use it to edit your original post (use computer, not phone).

Does anyone else think the dark wood to the right is too much contrast and too traditional cabinetry for this home, especially with the OP's very contemporary vision for the fireplace? @Kate are you trying to head more contemporary? Other elements I see also are traditional.

@Kate can you explain your interest in stone? I love it so you don't have to sell me on it. You're right that a typical stone surround to the ceiling would be awkward for the ceiling that slopes. Did you just want to bring in that element? Or do you want to have stone on that wall? Have you considered heated contemporary stone flooring to upgrade from wood? It works well in heavy traffic areas and is very cozy if heated.