David Cameron named the man as Chris McManus who was killed with fellow hostage Italian Franco Lamolinara.
It is understood a Special Boat Service operation to free them from al-Qaeda aligned kidnappers failed.
The effort to free Mr McManus, from the North West of England, and an Italian hostage was launched by Nigerian forces with the assistance of the UK.
The Prime Minister said the pair appeared to have died at the hands of their captors, either before or during the course of the rescue bid.
Mr Cameron said: "The effort to free Chris McManus from the north west of England, and an Italian hostage was launched by Nigerian forces with the assistance of the UK.
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