A bit of an exaggeration. It might be more accurate to say that the South sent a delegation to deliver their demands to be recognized. Only if Lincoln caved was there a vague offer to discuss "matters and subjects interesting to both nations." So if paying for the stuff they stole wasn't interesting to the Confederacy then it wasn't open for discussion.
I know editing wikipedia is plowing the sea, but sometimes it has useful information.
Hope someone who knows more than me edits it to put that in.