The 27-year-old, whose current deal expires on June 30, will extend his contract by three years.
Benitez had hoped for a new four-year deal but agreed to Nice’s offer of three.
Nice coach Patrick Vieira trusts Benitez, a €3.5m signing from Quilmes in 2016, and has branded him a ‘great keeper’.
Vieira knows Benitez can still improve and plans to add a stronger back-up goalkeeper in place of Yoan Cardinale.
Benitez remains uncapped by Argentina but has not given up on that dream. Staying number one at Nice and appearing in next season’s Europa League will give him greater exposure and could lead to an appearance for the Albicelestes.