Islamist militants Boko Haram have released a video apparently showing about 130 girls kidnapped from a school in northern Nigeria on 14 April.
Boko Haram leader Abubakar Shekau said the children would be held until all imprisoned militants had been freed.
Interior Minister Abba Moro rejected the deal, telling the BBC that it was "absurd" for a "terrorist group" to try to set conditions.
Boko Haram abducted more than 200 girls and threatened to sell them.
The BBC's John Simpson in the northern city of Maiduguri says Boko Haram's comments show signs that the group is willing to negotiate.
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