I'd use a rasp to get it out of the sheath, but be gentle with it, you can remove a lot of material fast. Once you've used the polish that Curtis mentioned, there may be some pitting. The green oxidization is the copper-based equivalent of rust. Just sand it down using high grit sandpaper or a scotch-brite pad, and repolish. Oil the sheath to prevent it in future, and if you're going to store it, store it wrapped in a oiled cloth for long term, since that oil in the sheath will only hold it off for short term.
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Oz
"When your work speaks for itself, don't interrupt."
- Henry J. Kaiser