This is how I would approach him:
I agree that key point here is your friends relationship with God right now. If he has accepted Christ, it sounds like he is dwelling on this dream because he is questioning his salvation.If you have gone through this in one way or another, let him know that he is not alone. He probably thinks he is wrong for doubting this, so maybe there is reason to doubt. Remind him that Satan will always try to get us to doubt, to question God's promises,His loyalty, and His authenticity,just as he did with Eve in the Garden of eden. Also,if he is doubting he could be holding on to something, as many of us do, that he feels will keep his name out of the book of life.Remind him that it is not through our actions that we are saved, but God's grace. and encourage him to get on his knees, and confess what he is carrying,and offer it up to God. If he is unsure of what it is, he can ask God to reveal it to him. It may not be instantaneous,but God will show him what his burden is. God does not comand us to repent of something we cannot confess. We are toconfess, and then repent.
If he is not a Christian, lovingly try find out why. In my mind he would not be dwelling on this dream as he is, if he was completely decided on not accepting Christ. He is mulling it over, and this dream shook him up. Only when you find out his reason for hesitation, can you offer encouragement to get him past it, otherwise, you are just grasping at straws till you lay hold on the right one, and both will get frustrated.
I hope that this is helpful.
-CS
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