A South Korean company confirmed on Thursday a statement by the Movement for the Emancipation of the Niger Delta (MEND), which said it had handed the hostages over to a Nigerian senator at 4pm (1500GMT).
"Negotiations with the militant groups were successful and all of the five workers are about to return," a spokesman for Daewoo Engineering and Construction said by telephone.
Three of the kidnapped South Koreans work for Daewoo while the other two are with Korea Gas.
MEND said it released the five in response to an appeal by Mujahid Dokubo-Asari, a prominent militant leader jailed last year whose freedom they had demanded in exchange for the hostages' release.
It was unknown how or where Dokubo-Asari made the appeal.
Mujahid Dokubo Asari had called
for the hostages' release
The group said it had handed over the South Koreans to David Brigidi, an ethnic Ijaw member of the Nigerian Senate who has spoken out in favour of securing greater local control of oil wealth.
They did not say where the handover occurred.