Use commas, and be more creative with your dialogue. One of the first things I learned about writing was that you can't just use 'said', try 'replied' and 'exclaimed' and 'questioned', etc, any speaking related verb you can use in past tense, really. You have some of that in there but it needs more variety. Another thing you want to stay away from is including all your details in the dialogue, this should typically be in a paragraph preceding it. And again, can't emphasize enough, COMMAS.
You seem to have everything except the above down, and the story's premise seems genuinely interesting, so good work. I look forward to more.